Coop banks seek recognition of COBI, relief from taxes

Written by:
Subscribe to Oneindia News

New Delhi, Sep 25 (UNI) The cooperative banks have sought immediate licence from RBI for their apex bank -- Cooperative Bank of India (COBI) -- for exemption from tax on their profits and allowing them to operate on norms applicable to commercial banks.

The two-day national conference, which concluded here today, was attended by delegates from all over the country. The delegation sought the cooperative laws to be amended suitably preventing the states to frequently change the cooperative bye-laws at the whims of politicians.

They were also of the view that the agriculture ministry should take a lead in this respect as cooperative banks have a share of 37 per cent in institutional farm credit of the country.

These banks can save the the farmers from clutches of private money lenders to a major extent, who charge 30-50 per cent interest, pushing the farm sector into heavy debt.

Mr B S Vishwanathan, Chairman, COBI, observed that cooperative banking sector ''is clearly at cross roads and sandwitched between regulators and the state governments should be allowed to function as developmental institutions''.

They also felt the cooperative banks should be financed by the government and be allowed to raise funds at competitive rates at par with commercial banks, since they cannot have sound capital base with its operation in poor and downtrodden people.

Rajya Sabha Deputy Chairman K Rehman Khan, who had himself been in the secytor, profusely supported the conference demand for granting a licence to COBI for its immediate operationalisation.

He, however, urged 'cooperators' to thoroughly introspect on why cooperative banks got stuck into muck and what hampered them from being professional in their approach.

NABARD Former Chairman Y C Nanda found that lack of democratic management is the bane of the cooperative banks and most of times 'internal constraints outweight the external problems of these banks'.

Please Wait while comments are loading...