Government Focuses on Only 23 Cooperatives Despite Rs 200 Billion Savings to be Returned to the Public

The government has announced an allocation of only NPR 25 crore to the revolving fund for refunding the savings of depositors in problematic cooperatives. Nationwide, there are around 32,000 cooperative institutions holding approximately NPR 1.2 trillion in savings, with 63,000 affected members demanding the return of their deposits. Former Secretary Gopinath Mainali stated that political protection in the cooperative sector has prevented resolution of these issues, and the government has repeatedly given only assurances.

Millions of people who have deposited money in cooperatives across the country have been waiting for years to recover their savings from these institutions. Various task forces have been formed, reports prepared, and even legal amendments made concerning this issue. However, depositors have yet to receive any guarantee for the reimbursement of their savings. After the Jana Aandolan (People’s Movement), the National Independent Party (Rastriya Swatantra Party – RASWA) formed the government with a majority mandate and pledged to refund cooperative victims’ savings within the first 100 days, but cooperative depositors remain uncertain about receiving their money, as banks prioritize other creditors.

Through the fiscal year’s budget announcement, the government declared it will place funds in a revolving fund to refund cooperative depositors. However, the government plans to contribute only NPR 25 crore as seed money to this fund. According to the Office for the Management of Problematic Cooperatives, there are 63,000 depositors demanding refunds, who belong to just 23 problematic cooperatives.

Although the government has repeatedly insisted that the regulation and supervision of cooperatives should be handled by Nepal Rastra Bank, the central bank has stepped back from this responsibility. A senior official from the Ministry of Cooperatives revealed that previous governments were unable to refund depositors’ savings due to political obligations to protect political leaders and activists involved in these cooperatives. “About 90 percent of cooperatives are run by individuals with political backgrounds,” the official added.