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Every city with population over 200k to get co-op bank in 5 yrs: Shah
The government aims to expand urban cooperative banks nationwide, urging digital adoption to reduce NPAs and boost job creation, says Amit Shah.
The government is focusing squarely on expanding the urban cooperative credit sector, Union home and cooperation minister Amit Shah said on Monday, urging lenders to adopt digital technologies for transactions in a key address at an international conference in the national capital.
Every city in the country with a population of over 200,000 will have a cooperative bank in the next five years, Shah said, adding: “In the past two years, we have succeeded in reducing the NPA (non-performing assets from 2.8 per cent to 0.6 per cent.”
At the international conference on the urban cooperative credit sector, Co-Op Kumbh 2025, Shah listed several steps to bolster lending by financial entities in the cooperative sector, part of measures to expand business based on the shared-ownership model. He referred to the ‘Delhi Declaration 2025’, which will serve as the roadmap.
Cooperatives are collective enterprises owned jointly by their members, who share profits and losses equally. India’s cooperative sector, over a century old, provides livelihood to millions in sectors such as dairy, fisheries, finance, housing and agriculture. Firms, such as Amul, the largest dairy producer, runs on a cooperative model.
India said lenders in the cooperative sector should take advantage of financial digital technologies, developed and popularized India globally. “You know that payment now happens through digital technologies. The ‘Sahkar Digi-Pay’ and ‘Sahkar Digi-Loan’ apps are set to become symbols of the cooperative sector’s participation in the digital revolution.”
Headline numbers and GDP figures alone cannot “reflect our progress” and institutions must ensure that “every person gets some work and that their standard of living improves, which cannot happen without cooperatives”, Shah said.
The Centre is aiming at an expansion of the sector to spur job creation and it has called upon states to forge a common policy approach. Cooperatives fall under the jurisdiction of states. The Centre, however, has a say in multi-state cooperatives.
“Urban cooperative banks must carry out their core functions with a multi-sector approach for the empowerment of young entrepreneurs, self-help groups, and weaker sections of society. Our goal is to strengthen cooperatives and, at the same time, to strengthen the weaker sections, and no institution other than urban cooperative banks can achieve this.”
In July 2021, the Modi government created a ministry for cooperation, helmed by Union minister Amit Shah, carving it out of the farm ministry. The Centre has since rolled out several changes to digitise and expand a sector that plays a key role in the rural economy. Last year, Parliament enacted the Multi-State Cooperative Societies (Amendment) Act, 2022, to improve governance of national-level cooperatives.
