KATHMANDU, July 12: The Department of Cooperatives (DoC) has issued a deadline for those who have memberships in more than one cooperative organization–with similar nature and located in the same local unit – to relinquish multiple memberships within the next one and a half years. 

Issuing a public notice on Thursday, the regulatory agency of the cooperatives instructed all such members to maintain membership in only one cooperatives organization by mid-October 2020. 
The notice of the department comes as part of the government efforts to end the practice of cooperative members holding memberships in multiple cooperatives. 

The government move is in pursuance of the ‘Cooperatives Act, 2074’ that was enforced on October 18, 2017, which has a clause on barring cooperative members of holding shares in more than one cooperative with similar objectives in the same local unit.

The act has provided a deadline of three years for those who are members of multiple cooperatives to maintain membership in a single institution within three years of the act coming into enforcement. 

The notice has also directed all cooperatives to inform the new provision to their members. It has also warned that it will take action against those members who fail to relinquish multiple memberships within the deadline. 

According to the data of the department, there are a total of 34,512 cooperatives across the country with 6.3 million members. Out of them, 13,578 are saving and credit cooperatives that have 3.45 million members. 

Though there is no estimate about the multiple memberships, officials of the department say that many of the members have cross memberships in different cooperatives. 

Department officials say that the provision was aimed at promoting international principle of cooperatives. “The provision is in the act itself. So we have issued the notice to implement the clause,” Tok Raj Pandey, the department’s registrar, told Republica. “The basic principle of cooperatives is that you should be a member of only one cooperative where you utilize your knowledge, skill and capital for the shared benefit. When a person become a member of multiple cooperatives, he or she will take loans or get services from them and such practice can increase the risk in case the member defaults in the loan,” he added. 

However, leaders of the cooperative sector say that ending duplication of membership is not as easy as the government thinks. 

“As ending the practice of duplication of membership is provisioned in the act, it must be enforced. However, it’s going to be very difficult for the government to implement the provision,” D B Basnet, chairperson of Nepal Federation of Savings and Credit Cooperative Unions Ltd, told Republica.

 
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