Professional Documents
Culture Documents
By: G. Jayalakshmi
Rooted in local
communities
Cooperative banks are deeply
rooted inside local areas and com-
munities. These are involved in lo-
cal development and contribute to
the sustainable development of their
communities, as their members and
management board usually belong
to the communities in which they
exercise their activities. By increas-
ing banking access in areas or mar-
kets where other banks are less pre-
sent—SMEs, farmers in rural areas,
middle or low-income households in
urban areas—cooperative banks re-
duce banking exclusion and foster
C
the economic ability of millions of
ooperative banking is ing a common interest. people. They play an influential role
retail and commercial Cooperative banks generally in the economic growth of the coun-
banking organised on provide their members with a wide tries in which they work and increase
a cooperative basis. range of banking and financial the efficiency of the international fi-
Cooperative banking services like loans, deposits and nancial system. Their specific form of
institutions take deposits and lend banking accounts. These differ from enterprise, relying on the above-men-
money in most parts of the world. A stockholder banks in their organisa- tioned principles of organisation, has
cooperative bank is a financial entity tion, goals, values and governance. proven successful both in developed
which belongs to its members, who Cooperative banking includes re- and developing countries.
are at the same time the owners and tail banking, as carried out by credit
the customers of their bank. Coop- unions, mutual savings and loan Structure and features
erative banks are often created by associations, building societies and
persons belonging to the same local cooperatives, as well as commercial In most countries, cooperative
or professional community or shar- banking services provided by mutual banks are supervised and controlled