Targeted Rs 9000 crores but achieved 23,263.73 crores: Cooperative banks regain their credibility

A spate of extortion and fraud in a few cooperative banks across the state, including Karuvannoor, had created tension among ordinary investors. Such large-scale frauds were an incident that threatened the very existence of the cooperative movement. The government came forward with this year's investment campaign amidst great doubts about the cooperative sector among the people. In the investment drive that lasted from January 10 to February 12, the target was to collect Rs 9000 crore, but incredibly, two and a half times more than the planned investment reached the cooperative banks in this single month. 23,263.73 crores to be precise.

The response from the public has surprised the cooperation department. Higher interest rates compared to bank deposits were the main attraction but more than that, this visible surge in deposits underlines that the trust of common man in co-operative banks has increased more than before. In the wake of the Karuvannur Co-operative Bank scam, many people had closed their deposits in Cooperative Banks and sought safer places. Stakeholders had spread false propaganda that the cooperative sector was collapsing and deposits were unsafe.

No one will be willing to see the loss of hard-earned money. The campaign against co-operative banks may have influenced at least a few. The proof of that was the rush of people to withdraw their deposits in many places. In any case, it is heartening to note that cooperative banks have regained credibility very quickly due to the firm steps taken by the government. Most of the depositors in cooperative banks are ordinary people. Co-operative societies and banks, which have been operating in their surroundings for ages, are in many ways their refuges. A closeness and a sense of belonging that is not felt with other financial institutions is what keeps people attached to cooperative institutions.

Corruption can be seen everywhere. It has been revealed that the chief executives of the co-operative banks are the ones behind the recent irregularities and massive money laundering. It has also been revealed that political influence is what helps them to commit such irregularities. Failures in inspections and auditing can also help cover up fraud. The lack of vigilance of the Cooperative Department is also worth mentioning. If the irregularities committed by the governing body and officials had been discovered at the right time, the deposits in many cooperative banks, including those in Karuvannur, would not have been diverted. Their progress has also been tempered by the unbridled political influence that plagues the co-operative movement.

The unprecedented success achieved in the investment mobilization campaign provides an opportunity for the government and cooperative movements to proceed with greater caution. This is a solid proof of the trust that the people repose in the co-operative movement. It should be preserved. The department should always keep an eye on the transactions of cooperative banks. Immediate intervention is required if even a hint of irregularity is visible. The Reserve Bank and the central government have been trying for a long time to bring more restrictions on the cooperative banks in the state. Let's not forget the fact that the co-op scams that keep coming out one after the other are helping these moves.