Former Finance Minister Emphasizes Need for Stronger Regulation in Cooperative Sector

At a seminar organized by the National Federation of Savings and Credit Cooperative Unions Limited (NEFSCUN), former Finance Minister Dr. Yuba Raj Khatiwada highlighted the urgent need for enhanced regulation and supervision in Nepal’s cooperative sector. The event, which began on Tuesday, saw discussions focused on the challenges and regulatory requirements of cooperatives.

Speaking at the seminar on Wednesday, Dr. Khatiwada pointed to the necessity of implementing second-tier regulation to address the rising issues within the cooperative community. He expressed concerns over the lack of responsibility taken by any agencies to mitigate the problems plaguing this sector. “If we do not resolve these issues ourselves, we risk external intervention,” Dr. Khatiwada warned, emphasizing the balance of accountability and autonomy in managing cooperatives.

He further remarked that the new challenges faced by cooperatives, especially those functioning as financial companies, require legal interventions and a robust regulatory framework to prevent anarchic tendencies and ensure stability.

Also addressing the seminar was Erik O’ Hern, International Advocacy and Regulatory Counsel for the World Council of Credit Unions, who shared insights on the importance of strong account supervision for the sustainability of cooperatives. O’ Hern underscored the need for a competent workforce at the Account Supervisory Committee (ASC) and advocated for increased financial literacy and adherence to rules among cooperative members.

The seminar continues to bring to light the critical aspects of cooperative management and the essential roles of regulatory bodies in ensuring their effective operation and long-term sustainability.