Not always a rosy picture

Coop banks have come under criticism for lack of vigilance and oversight

Despite their deep impact on the daily life of ordinary people, cooperative banks have come under criticism for the lack of vigilance and oversight by authorities.

Secretary for Cooperation Mini Antony says the amendments to the Banking Regulation Act in 2020 had tried to bring cash transactions under control and encourage the digital mode so as to have more transparency.

New cooperatives are not being registered as banks or bankers. They are being registered as societies. They have now been asked to end the system of issuing cheques to contain liquid cash transactions.

She says IT integration now being implemented by Kerala Bank will make all primary cooperatives touch points for transactions bringing all of them under a platform, which will make monitoring easy. IT integration is likely to be achieved by the end of May.

Referring to the scams in cooperative banks at Karuvannur in Thrissur and Mavelikara, she says efforts are on to ensure more transparency and the cooperative audit monitoring system now being implemented will bring more accountability to the system.

The Karuvannur bank fraud in which several people received notices for loans they had not availed is to the tune of ₹100 crore and critics of the governing panel of the bank, led mostly by Communist Party of India (Marxist) members, term this one of the biggest “bank robberies in Kerala”.

Allegations have also come up against reputed cooperatives such as the Uralungal Construction Cooperative Society. However, sources in the cooperative describe these as baseless and politically motivated.