Registration of Co-operative in Nepal

In Nepal, The Co-operative organization we guided and regulated by co-operative act 2048. A co-operative organization cannot start its legal business activity without registering in the co-operative department. Following steps are required co-operative in Nepal:

• Preliminary Meeting
• Application for registration
• Investigation of application
• Certificate of registration

Preliminary Meeting:

It is the first stage of a prospective member before starting a co-operative activity, at this meeting all the members will discuss the different matter such as problems and benefit of the co-operative number of members, objectives, and capital required rules and regulation. Once they are agreed about the formation of co-operative then they will form different committee and sub-committee for formation. The meeting should hold the discussion on following issues:

• Name, address, and objectives of society
• The value of each share and membership fee
•  Responsibilities regarding the amount  of capital raised through shares, and membership fee.
•  Working areas
•  Miscellaneous

Application for registration:

It is the second stage of co-operative registration. At this stage, a complete registration form is submitted to register department of co-operative. The co-operative act has provided a guideline, the checklist for information to be submitted along with the application for registration.  An application form can be obtained from the Office of the Register. Generally, the following information should be provided along with application for registration:

1. Name and address of co-operative
2. Objective and area of co-operative
3. Capital structure of co-operative
4. Minimum amount of membership fee
5. Any agreement between members before starting any co-operating
6. Copies of laws and by-laws of co-operative

Investigation of application:

The concern authority of department or co-operative will investigate information provided in application form. It identifies the correctness of information. The department will verify either the law or by the law of co-operatives are against or in support of current law of a country. If the department finds certain things to be amended it will issue notice for amended. If the team of co-operative is not able to provide such amendment then the department will refuse for application registration.

Certificate of registration:

The register of a department of co-operative will issue a certificate of registration after making an entry in the registration book. If the documents are satisfactory then registrar will issue a certificate of registration. The co-operative can start its legal business after getting a certificate of registration. The co-operative relating to saving and credit is required to follow rules and regulation provided by NR Bank. It must complete all basic requirement of NR bank before starting its economic activities.

The functions od National Co-operative Development Board are as follows:

•  Formation of plan and policies.
• Support to Nepal Government.
• Conduct necessary research and study.
• Provide credit facility.
• Investment in co-operative organization.
• Provide Guarantee for Securities.
• Provide technical Assistance.
• To enter into agreement for joint investment with local and foreign investors companies, institutions, for industrial development.

The National Co-operative Development Board is an autonomous corporate body established for social and economic development of a weaker section of society according to co-operative principles under the Co-operative Development Board. This organization is responsible for the development of policy, plan, and rules regulation relating to the co-operative organization. It provides different facilities for promotion and development of co-operative in all corner of the country. 25 members of the executive committee manage the board.

The meeting of the board can't be started without the presence of at least 50% of its member. This board can develop (from) different committee and subcommittee to work in a various aspect of a co-operative organization.

Function of NCDB

• Formation of pan and policies.
• Support to Nepal Government.
• Conduct necessary research and study.
• Provide credit facility.
• Investment in co-operative organization.
• Provide Guarantee for Securities.
• Provide technical Assistance.
• To make an agreement with joint investment with the local and foreign investor.

Formation of plans policies:
It is the main function of (NCDB) NC DB formulates the plans and policies relating to the development of cooperation organization in the country. For the development and promotion  of co-operatives,  it is necessary to formulate necessary policies. It modifies existing policies according to change of time and formulates new policies as well.

Support to Nepal Government:
It provides support activity to a government for plan and policies implementation. It helps the government in research and study activities of co-operative.

Conduct necessary research and study:
For the development of co-operatives, it undertakes research studies.  It makes the study of a trend of change in co-operatives. It worked to find out a new and improved technique of managing co-operatives.

Provide credit facility:
NCDB creates special kind of fund which is called co-operative development fund. This fund is utilized to provide a loan at subsidiaries rate of interest to the co-operative organization.

Investment in co-operative organization:
NCDB also makes an investment in a specific cooperative organization if it feels necessary to invest. Generally, NCDB invests into co-operative to take its management. 

Provide guarantee for securities:
On the request of the co-operatives organizations for issuing debentures or obtaining a loan from the bank and financial institutions,  NCDB works as a guarantor of assets of co-operatives.

Provide technical assistance;
NCDB conduct of different workshop training seminar to provide new and updated information about technology uses co-operatives. It may also provide a technical person for the certain period of time to co-operatives.

Developing countries are those countries in the process of development and industrialization is not taken place. The level of incomes availability of resources is less in developing countries. They are slowly developing their resources for industrialization. The co-operatives organization plays a vital role in the development of the country. In fact, co-operative organizations are valuable assets of a country to boost up the social and economic status majority of the people. The importance of co-operatives in developing countries like; China, Nepal, Sri-Lanka, India are described below:

• Encourage Saving
• Provide institutional Credit
• Help for economic diversification
• Terminate Middlemen
• Generating Employment
• Improve living standard
• Proper utilization of resources
• Democratic Management

Encourage Saving:
Co-operative organizations encourage a saving habit of people by providing a high rate of interest on saving among the members. They encourage farmers, employees and small-scale business units for saving a part of their incomes on a regular basis by offering an attractive rate of interest.

Provide Institutional Credit:
Rural people have to take a loan from a money lender at the high rate of interest but the co-operatives in the regular area provides institutional credit to their member in the easy process. They avoid exploitation of money lenders. Co-operatives grant a loan to farmers, employees, and small retailers who are neglected by the commercial banks.

Help for economic diversification:
The co-operative organization provides the economic activities in ruler backward areas. In regular areas banks financial Institutions are not there but the co-operatives facilities lending and saving service to rule public to starts to develop the economic activities there.

Terminating Middlemen:
The co-operative like consumer and marketing society helps to terminate middlemen consumer. Marketing society helps to sell and promote manufactures product directly to the consumers. This helps to terminate the role of middleman and benefit both consumers as well as manufacturers.

Generating Employment Opportunities:
Nowadays, unemployment has become the major problem of al developing countries. It provides additional employment opportunities in society. On the other hand, they e create self- employment opportunities even in rural areas. Co-operative promote business by providing loan and other facilities.

Improve living standard:
The target of co-operatives is to eliminate poverty and increase living standards of people. They developed saving habit of members. The saving of members is later utilized for different purposes such as production, distribution, education, health, game and sports, cultural and traditional activities, which helps to promote living standards of people.

Proper Utilization of Resources:
Co-operatives organization develop managerial skills in their member. They provide different training to their member regarding management of organization and resources.

Democratic Management:
Co-operative organization practices a democratic system of management. They educate their members to run a business on democratic lines and principles. They encourage the member to accept norms, values, rules and regulation of organization.