4.5.4 Co-operative Societies

Meaning: an autonomous association of persons united voluntarily to meet common economic, social and cultural needs through a jointly-owned and democratically- controlled enterprise — the standard definition (the International Co-operative Alliance's values: self-help, self-responsibility, democracy, equality, equity, solidarity; one member, one vote). Origins in one line: the Rochdale Pioneers (England, 1844) — the modern movement's founding shop. Types: producer cooperatives (farmers processing/jointly selling — dairy!); consumer cooperatives (buying goods jointly); credit/thrift and savings cooperatives (SACCOs — Nepal's most numerous and most troubled); marketing cooperatives (coffee, cardamom, vegetables, milk collection); farming/irrigation cooperatives; housing and energy cooperatives. Importance: mobilising small savings into credit; financial inclusion where banks will not go; countervailing market power for small producers; member education; employment; the democratic classroom — people learning governance by practising it. Nepal (the balanced paragraph): thousands of cooperatives; the sector promoted as the "third pillar" of the economy alongside the state and private sectors; regulation under the Cooperative Act 2074 (2017) with the Department of Cooperatives and (for financial cooperatives) NRB oversight — and, candidly, a run of high-profile savings-and-credit failures that made governance, audit and depositors' protection a legal priority (the sector's exam-worthy cautionary tale: cooperation's economics are sound; its governance is the legal challenge — which is exactly why this topic is on a law syllabus).