Problems of Urban Credit Co-operatives (UCCs) in Maharashtra (with Reference to Study of select Urban Credit Cooperatives in Pune)

Since 1991, the government of India has extinguished the permit raj & license system and set the economy free. All types of businesses and economic institutions have become free. This has impacted the co-operative sector as well. In credit supply sector also the private finance companies like Muthoot finance, Manipal Finance, have started competing with the credit cooperatives. The process of sanctioning loan by private financial institutions is very easy and simple. Documentation for loan is also minimum. This attracted needy people to these private businesses. The credit cooperatives mostly suffer from politics, corruption and malpractices, threatening the very existence of them. The UCCs still face many problems like rigid audit system, unnecessary government control, delayed loan sanction processes, etc. In this study an attempt is made to find out the problems faced by credit cooperatives so as to suggest management system for their survival in the competitive economy. The UCCs are critical to financial inclusion.