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Explain loans from cooperatives.
Loans from the bank cannot be availed by all the citizens. The poor farmers cannot get the loan from the bank by mortgaging the collateral and afford all the credentials prescribed in terms of credit. The cooperatives is a voluntary organization which includes certain groups; they remove the problem by advancing the loan to the farmers with a low-interest rate. The cooperative is not only for the farmer society but there also many societies which have formed societies but only a few have registered under RBI. One of the major sources of raising credit in the rural area is cooperatives; there are several types of cooperatives such as
• Farmer cooperatives
• Workers cooperatives
• Weavers cooperatives
In a farmer cooperative, there will be many farmers as members, and they discuss the common issues faced in agriculture. These cooperatives help the farmers to buy the equipment, seed and other essential goods that are needed for agriculture. The loan process will not be rigid as per the banks.