Minister calls upon cooperative banks to focus on creating jobs, entrepreneurship

Parliamentary Affairs and Tourism Minister H.K. Patil inaugurating the golden jubilee celebration of the Gandhi Gunj Cooperative Society at Sindol Kalyan Mantap in Bidar on Sunday.
| Photo Credit: SPECIAL ARRANGEMENT

Taking exception to cooperative banks working with limited scope, Parliamentary Affairs and Tourism Minister H.K. Patil has called upon such banks to focus on job creation and promoting entrepreneurship among people.

“Cooperative banks offer loans to purchase cars, residential plots, houses and personal loans for marriage. But they don’t offer loans for opening a small-scale industry. As long as the cooperative banks don’t change this approach, they cannot serve their purpose. Their service will not amount to social service. Cooperative banks must focus on empowering the economically weaker sections by offering financial assistance to their entrepreneurship,” he said at the golden jubilee celebrations of the Gandhi Gunj Cooperative Society at Sindol Kalyan Mantap in Bidar on Sunday.

Stressing on the importance of employment generation to strengthen livelihood and economy at the grassroots level, Mr. Patil said that job creation will also provide solid foundation for a peaceful society.

“The banks must focus on job creation. Decent jobs for the working population will lead to a peaceful society. Cooperative banks must make resolutions at each meeting to offer loans to job creators. The level of contentment you get in giving jobs to the working hands is unmatched. The street vendors, vegetable and fruit sellers and petty shop owners still borrow from private financers at over 25% interest,” he said.

“If you can identify such people in need of financial assistance and offer them loan with reasonable interest, it will be a great service. Taking resolute steps towards employment generation will give meaning to this golden jubilee,” Mr. Patil said.

Advising banks to come out of their traditional mindset, Mr. Patil asked them not to demand security for every loan that they offer to the poor.

“You cannot expand your business if you remain in the ambit of traditional outlook. If you continue to demand security for every loan you disburse or if you deny loans for the establishment of small-scale industries or businesses, you cannot grow. Cooperative banks are meant for the poor and not for the rich. You must identify the people from the downtrodden sections that require financial assistance to establish a small trade, business or industry to make a decent living and help them out,” he said.

Mr. Patil also criticised the successive governments for their errant banking policy by stating that the banking sector has been spoiled in the last two decades by merging 1,500 banks to create bigger entities.

“The damage of bank merger is now realised. Due to the big resistance that cooperative banks posed, the governments have changed their policy. Everybody now admits that small is beautiful. Small banks can assist and promote small-scale industries which can contribute to national economy in a big way,” he said.

Recalling the birth and growth of Gandhi Gunj Cooperative Society, chairman of the bank Vjayakumar Patil said that it was established by 189 traders of Gandhi Gunj with an initial share capital of ₹1.82 lahk in 1974. Mahanthappa Madaki was its first chairman.

“Now, the bank has a share capital of ₹5.19 crore. It has its branches in Bidar, Basavakalyan, Bhalki, Humnabad and Aurad towns. The bank has made a net profit of ₹1.26 crore in 2023-24,” the chairman said.

Head of Bhalki Math Basavalinga Pattadevaru said that the Kayaka and Dasoha principles of Basavanna and other Sharanas of the 12th century must be the founding principles for cooperative banks.

He also recalled how he borrowed from Gandhi Gunj Cooperative Society to purchase a plot for building a Prasada Nilaya (community dining) in Bidar and how he repaid the loan.

Forest Minister Eshwar Khandre emphasized the need to get rid of what he called loan waiver culture for the sustainable development of individuals and society as a whole.

“Banks must ensure the timely recovery of loans. The people must also get rid of the loan waiver culture. Trust plays a key role in the success of any cooperative bank. The banks must also ensure that their functioning is transparent and corruption-free. Many cooperative banks in the district are on the verge of collapse as they have nurtured a tradition of lending to ineligible people,” Mr. Khandre said.

Municipal Administration Minister Rahim Khan launched a special deposit plan of the bank.

Legislators Shailendra Beldale, Siddalingappa Patil, M.G. Muely, DCC Bank president Amar Kumar Khandre, the former Union Minister Bhagwanth Khuba and others were present.