Problematic Cooperatives Management Committee Clarifies Savings Return Process

Kathmandu. The Problematic Cooperatives Management Committee has drawn serious attention to the confusion spreading in the market regarding the establishment and operation of a revolving fund for the return of savings of members of problematic cooperatives. The committee has issued a press release to clarify the situation after public complaints and confusion arose that savings were being returned with state funds. The committee is currently in the process of returning savings to small savers with less than ten thousand rupees in savings from 20 cooperatives declared problematic by the Government of Nepal. The committee stated that a revolving fund has not yet been established and operated, and funds received from the recovery of loans and management of assets from problematic cooperatives are continuously being returned to the savers of the respective cooperatives in accordance with legal provisions. Various legal and policy arrangements have been made to return the savings of savers who have deposited money in problematic cooperative institutions. This includes the provision in Section 108 (A) of the Cooperative Act, 2074, point number 23 of the Government of Nepal's policy and program for the fiscal year 2082/83, point number 61 of the budget statement, the order issued by the Supreme Court on Magh 11, 2082 (Case Number 080-WO-0541), and point number 99 of the one hundred work lists approved by the Government of Nepal Council of Ministers meeting on Chaitra 13, 2082. To implement these, the Government of Nepal Council of Ministers has issued the 'Procedure for Establishment and Operation of Revolving Fund for Return of Savings of Members of Problematic Cooperatives, 2083' under the Problematic Cooperatives Management Committee. Article 5 of the issued procedure states that when returning savings from the fund, it should be recorded as a loan in the name of the respective cooperative. Similarly, arrangements have been made to return savings through bank accounts to savers who have submitted claims applications as per Section 112 (A) of the Act, ensuring no duplication. Article 8 of the procedure clearly stipulates the legal provision that the committee must be reimbursed for the amount provided as a loan in the name of the institution from the funds recovered from loan recovery, sale of assets, auction sales, and from the directors, managers, and other related individuals. Acting Member Secretary of the committee, Saraswati Parajuli, informed that the Problematic Cooperatives Management Committee is prioritizing loan recovery and that only the amount recovered from debtors has been distributed to the savers of the respective cooperatives so far. She further clarified through the press release that the amount received by the revolving fund from the Government of Nepal has not been distributed to any savers of the cooperatives so far.