First Business News Portal in English from Nepal
KATHMANDU: At a time when banks and financial institutions (BFIs) have been struggling to recover their loan amount, savings and credit cooperatives (SACCOS) have also been found landing on similar problems mainly due to the credit taken by their board members.
According to Nepal Federation of Savings and Credit Cooperative Unions (NEFSCUN), large amounts of credits provided to the board of directors (BoDs) and the members of the sub-committees of Saccos have been at risk of going into bad debts.
“The recovery of loans taken by the BoDs of the SACCOS has become increasingly challenging,” said Prakash Prasad Pokharel, chief executive officer of the NEFSCUN, speaking at a program on Sunday.
Of late, an increasing number of cooperatives have fallen into financial crisis, while the majority of them are found facing liquidity problems. In the past too, a large number of cooperatives faced similar problems due to their over-exposure to the realty business. In most of the cases, the high level executives of the cooperatives were found taking hefty loans from these cooperatives, for their personal uses.
Meanwhile, the NEFSCUN is organizing a two-day seminar of management heads of cooperatives, starting from Wednesday. According to the umbrella organizations of SACCOS, the conference featuring seven paper presentations and a gathering of more than 450 participants will focus mainly on solving the current problems seen in the cooperatives sector.
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