28 March, Kathmandu. Savings and credit cooperatives and associations are reluctant to accept the National Cooperative Authority as a regulator.

The authority, which was established as a regulator last year, called for registration of cooperative societies and organizations dealing in savings and loans. However, there are 32,000 cooperative organizations across the country, but only 2,262 have been registered within the limits given by the authority.

Stakeholders have said that they do not want to be registered with the regulator as they will open wrong and opaque transactions after registering with the authority or face the hassle of regulation.

In order to solve the problems of the cooperative sector, the Parliament amended the Cooperative Act 2074 and established the National Cooperative Authority. Accordingly, the government has constituted the authority.

In section 20 (a) of the Cooperative Act, there is a provision that within one year from the date of commencement of this section, institutions dealing in savings and loans must be registered with the authority or the body designated by the authority.

The same section of the Act came into effect from 18 Chait 2082. Accordingly, such cooperatives should have been registered by 17 Chait.

According to the Cooperatives Act, the authority called upon the organizations it regulates to register.

However, the number of cooperatives that have come under the regulatory scope of the authority during the time period given by the Act is very small. The director of a cooperative organization said that there are many regulatory bodies assigned to regulate cooperatives, but the cooperatives are not interested.

Stakeholders say that cooperative organizations may have misled the presence of the authority as an organization of its own class rather than a regulatory body.

The Authority had issued ‘Standards for Registration and Documentation of Savings and Loans Cooperative Institutions 2082’ and launched the online registration and documentation system (FCRS) of organizations from 10th December 2082. After that, the first call was made on 16 November 2082 for registration.

On 23rd January 2082, the authority again called for registration. Even after doing so, when the cooperative organizations did not come, the authority again issued a notice on 2nd March.

According to that, about 11 thousand 755 and only 2 thousand 262 of them have been registered till 17 Chait, informed Keshav Bhattarai, director of the authority.

He said that the authority has paid the registration fee of the cooperative organizations that applied by March 17 and if they have submitted the details, they have decided to accept the details and issue the operating license by the next May 17.

In addition, the authority has informed that the process of taking applications has been stopped in the case of cooperative organizations that have not submitted their application for registration within the mentioned time period.

Accordingly, the number of cooperatives that have received operating licenses has reached 2,262 within the time period specified by the authority. In addition, the authority said that the number of cooperatives whose applications have been verified and licenses are being issued is 955.

Similarly, 3 thousand 759 cooperative societies which have entered full details and 4 thousand 789 cooperative societies which have entered partial details are in the process of obtaining registration licenses. Cooperatives in the process of registration in the authority are only one third of the total number of cooperatives.

To control the situation in the cooperative sector, the government brought an ordinance to effectively regulate the cooperative sector. Former Secretary Gopinath Mainali said that even when the authority practiced regulation according to the provisions of the Act itself, the cooperative did not comply.

“Looking at the situation regarding cooperative registration, it was seen that an authority was not needed to implement the Cooperative Act,” said Mainali, “The Cooperative Department could also have done it. In most countries in the world, there is a situation where only one regulator has worked. There are two regulatory bodies and there has been policy ambiguity. It is said that there will be improvements in the cooperative sector if there is an authority, but effective implementation of the law is not necessary.”

He argues that the problem will not be solved by establishing an organization with the aim of appointing a political party or a person.

“Even before, some provisions of the Act were not allowed to be implemented by the cooperative campaigners,” said Mainali.

He also said that the cooperative organizations are working as sister organizations of the big political parties of the past. Being a powerful campaigner, why should the authority be accepted, he said, may have come to an important cooperative operator.

“There is also a kind of mentality that we should not go into the legal sphere of the cooperative sector,” he added, “Such a mentality exists in most of the big cooperatives, that’s why even the regulatory authority could not do it well. They will give a seven-day notice that they will be canceled if they do not come to register within the given time, and if they do not come even after that, they will be canceled because they did not come to the process.”

According to Mainali, if the authority fails to cancel it, it will not be different from the cooperative owner. The problem has become complicated because the campaigners have a tendency to voluntarily explain that it is not according to the principles of the cooperative, it is not according to our expectations.

Bhattarai, the director of the authority, said that there have been complaints from some organizations that they have not been registered in the authority due to the fact that they did not get the information on time about the registration in the authority.

“The authority has published notices three times at different stages, and there is also a clear provision in the Cooperative Act that registration should be completed by Chait 17, 2082,” said Bhattarai, “If all the details are given now, the authority will come under monitoring and if there is a difference, there will be a problem among the cooperative operators.”

Bhattarai believes that even though there are many regulatory bodies, cooperatives may not take seriously that they are all the same.

He said that the authority expects 15,000 cooperatives to be registered. He said, ‘The business of cooperatives that are not registered according to the Cooperative Act will be closed.’

Stating that many cooperatives did not audit the accounts on time, he argued that they may not have come for registration due to the fear of being known by the insider trading authority.

Cooperatives are regulated by unions, states, local levels, departments and authorities. He said that after the co-operative was not registered within the stipulated time, the authority wrote to the ministry to amend the co-operative act and facilitate it.