Credit Risk Management in Cooperative Sector Banks in India

Today, Credit Risk Management is primal in the process of credit lending process. This is equally true at all levels of corporate structure. Under this either private or nationalized banks should be considered. However, there exists another sector of banks that are being in existence that is being used by a large number of the middle class section of our society. These are co-operative banks of India. In the early 19th Century, with the success of cooperative societies outside India in countries like Britain and Germany led to the formation of cooperative banks as a very big moment. "Anyonya Co-operative Bank “of India is considered to have been the first cooperative bank setup in Asia. With a huge success of Urban Cooperative Bank UCB in Germany and Italy, in the year 1889 this first Cooperative society was setup as ‘ANYONYA SAHAKARI MANDALI ’in the then princely State of Baroda under the leadership of Late Shri Vithal Laxman Kavthekar. By the year 1904, the Co-operative society Act was passed in India. After studying various practices in agricultural land banking in European countries, a report by Sir Fredrick Nicholson was submitted which further led to the setup of Sir Edward Law committee? Report of Sir Edward Law committee was instrumental bringing out a special legislation for legal Cooperative setup in India.