Ministry Issues 15-Day Ultimatum for Troubled Cooperative Debtors

Kathmandu. The Ministry of Land Management, Cooperatives and Poverty Alleviation has issued a notice requiring debtors of troubled cooperatives to settle their outstanding loans within 15 days.

Following the full appointment of the Troubled Cooperative Management Committee, a notice was issued on Tuesday targeting directors, debtor members, managers, employees, and guarantors who have taken loans from these cooperatives.

The committee warned that failure to repay the loans will result in the freezing of assets and the auctioning of collateral belonging to both the debtors and their guarantors.

The notice states, 'Pursuant to Section 104 of the Cooperative Act, 2074, the Government of Nepal has declared these institutions troubled. Despite repeated notifications via the office website, national newspapers, SMS, and phone calls, debtors have failed to pay the principal, interest, and penalties. This notice mandates that all concerned parties contact the committee office in Buddhanagar, Kathmandu, within 15 days to settle their accounts.'

Furthermore, the notice warns that if the loans are not cleared within the 15-day period, the names and details of the debtors, their families, and guarantors will be made public. Their assets and bank accounts will be frozen, public services will be restricted, and the collateral provided at the time of the loan will be auctioned.

The notice further clarifies, 'If the debt is not settled within the specified date, the committee will write to the relevant authorities to freeze assets, bank accounts, and public services of the debtors, their families, and guarantors. Additionally, in accordance with the Cooperative Act, 2074 and Cooperative Regulations, 2075, the collateral will be auctioned or otherwise disposed of to recover the cooperative's dues.'

The government finalized the Troubled Cooperative Management Committee today. Tuesday's cabinet meeting appointed Dilli Raj Acharya from Pyuthan as Chairman, and Navaraj Simkhada from Dhading and Roshan Bahadur Shakya from Lalitpur as members.

The ministry has initiated a phased process to return funds to cooperative savers. The ministry aims to accelerate the repayment of savings alongside the recovery of loans.