KATHMANDU: The cooperatives of Nepal have fallen into financial crisis one after another due to their excessive investment in real estate, automobiles and other unproductive businesses.
Rudra Prasad Pandit, registrar at the Department of Cooperatives (DoC), said many cooperatives that had invested in unproductive businesses have been struggling to recover their amount.
“Increasing cases of bad debt of the cooperatives is the main reason behind their financial problems,” said Pandit at a program organized by the Cooperative Journalists Society Nepal.
Recently, cooperatives have been facing the problem of liquidity crunch. Due to this reason, they have been unable to return the money deposited by their members. Pandit also attributed the problems faced by the cooperatives to the exorbitant interest rates.