The government’s new ordinance on cooperatives, which includes rules for regulating cooperatives and returning the savings of members, will be sent to the President today. In a decision taken by council of Ministers in Singhdurbar in Nepal, it was decided to scrap the National Cooperative Development Board and recommend for introducing an ordinance to regulate cooperative institutions to the President.
The ordinance comes in response to suggestions from a parliamentary committee investigating cooperatives. It sets criteria for returning savings of up to Rs 500,000 deposited in cooperatives.
The ordinance also creates a National Cooperative Regulatory Authority, which will be independent and self-governing. The authority will follow guidelines set by the Nepal Rastra Bank.
Savings and credit cooperatives are now categorised into three levels, and registration will be done at the local level. The ordinance also sets limits on individual savings and loans: Rs 1 million for cooperatives within a district, Rs 2.5 million for cooperatives within a province, and Rs 5 million for those operating nationwide.
Spokesperson of Nepal government and Minister for Communication and Information Technology Prithvi Subba Gurung, clarified that investigations would be conducted against everyone involved in cooperative fraud cases, regardless of their political affiliation. The ordinance includes provisions regarding the chairperson, secretary, and other members of the commission. Once the President issues the ordinance and it is published in the national gazette, it will come into effect. It also needs to be endorsed by the upcoming winter session of the Federal Parliament.