The Government of Kerala has introduced the Kerala Co-operative Revival Fund Scheme, 2024. Announced on August 30th, 2024, this scheme is a strategic initiative aimed at revitalizing co-operative societies that are financially weaker or have become dormant. This move is expected to enhance the operational viability and sustainability of these societies, thereby reinforcing their role in Kerala’s economy.
Purpose of the Scheme
The Kerala Co-operative Revival Fund Scheme, 2024, is established under Section 57E of the Kerala Co-operative Societies Act, 1969. Its primary objective is to provide financial assistance to co-operative societies that are facing operational difficulties due to inefficiencies or liquidity problems. By offering support through this scheme, the government aims to restore these societies to a functional state, ensuring their continued contribution to the cooperative sector and the broader economy.
Key Details of the Scheme:
- Definitions and Terminology
• Act: Refers to the Kerala Co-operative Societies Act, 1969, which governs the operations of co-operative societies in Kerala.
• Department: The Co-operation Department, which will oversee the implementation of the scheme.
• Fund: Refers to the financial resources designated for this scheme, as specified under Section 57E of the Act.
• Government: The Government of Kerala, which is responsible for the administration of the scheme.
• Registrar: The official appointed under the Act to oversee co-operative societies.
• Rules: The Kerala Co-operative Societies Rules, 1969, which provide additional regulatory details. - Objective of the Scheme: The Scheme’s primary goal is to offer financial assistance to co-operative societies that are financially weaker or dormant. By doing so, it seeks to:
• Revive Operational Viability: Restore the functionality of societies suffering from inefficiencies and liquidity issues.
• Ensure Sustainability: Support societies to regain their strength and continue their contributions to the co-operative sector and the state’s economy. - Eligibility and Terms for Financial Assistance
• Eligibility: Any co-operative society registered under the Act that is experiencing financial distress or has become inactive but has the potential for recovery.
• Revival Plan: Societies must prepare a detailed revival plan outlining how they intend to overcome their issues.
• Financial Assistance:
o Societies may use any reserve funds they have, subject to conditions set by the Registrar.
o A two-year moratorium on repayment is provided, with repayment terms ranging from five to ten years. The State High Level Committee will determine the installment structure and interest rates.
• Application Process: Societies need to apply through forms specified by the Registrar to avail of the financial assistance. - Constitution and Management of the Fund
• Sources of the Fund:
o Up to 50% of the reserve funds of co-operative societies.
o Up to 50% of the Agriculture Credit Stabilization Fund.
o Government grants and other contributions.
• Investment: The Fund will be held in the name of the Registrar and can be invested in fixed deposits with the Kerala State Co-operative Bank or other approved schemes.
• Fund Manager: The Additional Registrar (Planning & Integrated Co-operative Development Project) will manage the Fund. - Project Reports and Utilization
• Preparation: Co-operative societies seeking assistance must prepare a project document for revival and submit it to the State High Level Committee through the Registrar.
• Allocation: The State High Level Committee will decide on the allocation of funds based on recommendations from the District Level Monitoring Committee.
• Utilization: Funds must be used exclusively for the revival project, and societies must ensure repayment of the principal amount along with fixed interest. - Oversight and Monitoring: The Scheme involves a multi-tiered monitoring system:
• State High Level Committee: Chaired by the Minister for Co-operation and includes various officials and experts responsible for overseeing the scheme and approving fund allocations.
• State Level Monitoring Cell: An office-based team responsible for analyzing project documents, maintaining records, and inspecting societies that have received funds.
• District Level Monitoring Committee: Oversees applications and fund utilization at the district level and submits recommendations to the State High Level Committee.
• Taluk Level Monitoring Committee: Manages the allocation and monitoring of funds at the taluk level.
• Society Level Monitoring Committee: Formed at the society level to supervise the utilization and repayment of funds. - Audit and Additional Conditions
• Audit: The Director of Co-operative Audit will conduct annual audits of the scheme to ensure transparency and accountability.
• Flexibility: The Government reserves the right to amend or relax provisions of the Scheme based on recommendations from the State High Level Committee.
Effective Date: August 30th 2024.
Conclusion
The Kerala Co-operative Revival Fund Scheme, 2024, marks a proactive step by the Government of Kerala to support and rejuvenate co-operative societies that are struggling to stay afloat. By providing targeted financial assistance and establishing a robust oversight mechanism, the scheme aims to restore the operational health of these societies and reinforce their role in the state’s economic framework. For co-operative societies facing challenges, this scheme offers a valuable opportunity to regain stability and continue their vital contributions to Kerala’s cooperative sector.
