CO-OPERATIVE BANK

ovement in India started with the enactment of the Indian
Co-operative Society Act, 1994. Co-operative Banks started functioning in India
under the provisions of Co-operative Society Act of the State.
Co-operative banks are governed by the RBI under the Banking Regulations Act
and amended by the Banking Laws Act, 1965 and the Banking Regulation Rules

The main objective of the co-operative banks are to accept deposit from the
member and the public for the purpose of providing loans to farmers and small
businesses men with the motive of service.

FEATURES OF CO-OPERATIVE BANKS

1. Co-operative banks are registered under the Co-operative Society Act of
   the State concerned.
2. Co-operative Bank are governed by the Reserve Bank Of India under the
   Banking Regulation Act, 1949 as amended by the Banking Laws Act, 1965
   and the Banking Regulation Rules 1966. Certain clauses of Reserve Bank
   of India Act 1934 are also applicable to Co-operative Banks.
3. In India Co-operative Banks are not nationalised.
4. The area of operation of Co-operative Banks is limited and confined to
   State. Co-operative Banks does not operates at National or International.
5. Co-operative Banks do not provide merchant banking services.
6. Limited funds are available at disposal of Co-operative Banks.
7. Co-operative Banks provide higher rate of interest on deposit.
8. Co-operative Banks do not operate mutual funds.
9. The Basis of Operation is on Co-operative line that is service of members
   and to society. Unlike commercial banks they do not operate to earn
   profit.
   10.Co-operative banks in India function on the basis of there tier structure.