The Cooperative Society And Characteristics
The Cooperative Society And Characteristics of The Cooperative Society
Saturday, June 27, 2020
The Cooperative Society is the group of persons or institutions that come into existence to offer various services to its members. One who cannot benefit in his individual capacity can gain as a member of cooperative society, since it purchases in bulk quantities resulting in economies a part of which is shifted to its members. Thus the members can buy at prices less than the market.
CHARACTERISTICS:
• The society is formed on mutual cooperation.
• Every member is required to pay an annual fee.
• Societies may be registered.
• Members must pay service charges.
• It is run on no profit, no loss gain basis.
• The profit, if made, is distributed to the members.
• Societies are formed in the fields of banking, housing, farming, fishing, credit, and others.
• Registered societies must use the word “limited” following their names.
ADVANTAGES OF COOPERATIVE SOCIETIES
Following are the advantages of Cooperative Societies.
CONTINUITY
The cooperative societies enjoy a long and stable life. Like a company, it doesn’t come to an end in case its founders or member die.
LOW PRICES
Since it is operated on and no-profit no-loss basis the price of the product offered for sale are kept at a lower level than that of the market.
LOANS
Loans are offered to agriculturists to facilitate them to buy seeds, fertilizers, tractors, and hire warehouses.
HOUSE LOANS
Many cooperative societies are formed in the field of housing and advance loans to the members to build, renovate, and buy houses at a lower rate of interest than the bank.
DISADVANTAGES OF COOPERATIVE SOCIETIES
Following are the different disadvantages of Cooperative Societies.
FEE PAYMENT
The members of the society must pay a certain amount as a fee on annual basis which becomes cumbersome to them. If the society is unable to make any profit the amount of fee is un refundable.
UNLIMITED LIABILITY
Society can be run without registration under society’s act 1912. In such a cases, the liability of the members becomes unlimited.
PAYMENT OF SERVICES CHARGES
Members of the society must pay service charges to finance the day-to-day expenses of the society. These charges are refunded when it earns profit.
DIFFERENCES OF OPINION
Differences of opinions in running the society may lead to its dissolution just like the partnership.
CHARACTERISTICS:
• The society is formed on mutual cooperation.
• Every member is required to pay an annual fee.
• Societies may be registered.
• Members must pay service charges.
• It is run on no profit, no loss gain basis.
• The profit, if made, is distributed to the members.
• Societies are formed in the fields of banking, housing, farming, fishing, credit, and others.
• Registered societies must use the word “limited” following their names.
ADVANTAGES OF COOPERATIVE SOCIETIES
Following are the advantages of Cooperative Societies.
CONTINUITY
The cooperative societies enjoy a long and stable life. Like a company, it doesn’t come to an end in case its founders or member die.
LOW PRICES
Since it is operated on and no-profit no-loss basis the price of the product offered for sale are kept at a lower level than that of the market.
LOANS
Loans are offered to agriculturists to facilitate them to buy seeds, fertilizers, tractors, and hire warehouses.
HOUSE LOANS
Many cooperative societies are formed in the field of housing and advance loans to the members to build, renovate, and buy houses at a lower rate of interest than the bank.
DISADVANTAGES OF COOPERATIVE SOCIETIES
Following are the different disadvantages of Cooperative Societies.
FEE PAYMENT
The members of the society must pay a certain amount as a fee on annual basis which becomes cumbersome to them. If the society is unable to make any profit the amount of fee is un refundable.
UNLIMITED LIABILITY
Society can be run without registration under society’s act 1912. In such a cases, the liability of the members becomes unlimited.
PAYMENT OF SERVICES CHARGES
Members of the society must pay service charges to finance the day-to-day expenses of the society. These charges are refunded when it earns profit.
DIFFERENCES OF OPINION
Differences of opinions in running the society may lead to its dissolution just like the partnership.
