As we all know, the cooperative Banks in India are passing through a difficult phase and their performance is NOT as glamorous as that of the commercial banks today. What went wrong with cooperative Banks ?
(A) The cooperative banks disbursed credit on the loans on demand mostly without proper guarantees and documents. Hence repayments were always at the mercy of the borrowers and upto some extent on good crops.
(B) The cooperative banks are mostly under the supervisory control of the Panchayats, which are not professionally qualified to control such institutions.
(C) Cooperative Banks do not get any relief package from the Govt. Hence they have to manage their affairs on their own resources only.