Economy, asked by mohdaqdas1406, 1 year ago

Problems and functions of cooperative banks india

Answers

Answered by TIAMK36
0
Co-operative banks also perform the basic banking functions of banking but they differ from commercial banks in the following respects
1. Commercial banks are joint-stock companies under the companies’ act of 1956, or public sector bank under a separate act of a parliament whereas co-operative banks were established under the co-operative society’s acts of different states.
2. Commercial bank structure is branch banking structure whereas co-operative banks have a three tier setup, with state co-operative bank at apex level, central / district co-operative bank at district level, and primary co-operative societies at rural level.
3. Only some of the sections of banking regulation act of 1949 (fully applicable to commercial banks), are applicable to co-operative banks, resulting only in partial control by RBI of co-operative banks and
4. Co-operative banks function on the principle of cooperation and not entirely on commercial parameters.
Problems of Co-operative Banks:

1. Non- accountability

2. vested interest of some people

3. Lack of coordination

4. The internal free rider problem

5. Quality more than one quantity

6. No balanced growth
Similar questions