Explain The Importance Of Cooperative Society?


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Cooperative societies are important in order to help organize mutual benefits. Within a cooperative structured society in its original tribal form, jobs are allocated and resources are exchanged among each other and trading is only done with external communities. Now cooperative societies are extremely important in the savings market and for mortgage and professional credit within banks. Cooperative societies are businesses that are set up by a number of individuals with the intention of gaining mutual benefits from them.  These societies are important to ensure that everyone who has put an investment into them gets a fair and equal return.

The most common cooperative societies fall into the categories of housing cooperatives, utility cooperatives, agricultural cooperatives, credit unions and cooperative banking and federal or secondary cooperatives.
• Housing cooperatives - these societies are created when residents own shares that reflect their equity in the cooperative's real estate. The residents may also have a membership or occupancy rights.
• Utility cooperatives - a type of consumer cooperative that delivers public utilities. These could include electricity, water or telephone lines. Profits made from these utilities will either be reinvested into the services or given to members as dividends.
• Agricultural cooperatives - farmers may group together their resources in order to get mutual benefits back from them. This could be land or machinery that can be used jointly by farms.
• Credit unions and cooperative banking - credit unions are financial institutions that members own and control. Cooperative banking is credit unions on a network scale. For example, in Poland, there is a cooperative banking network that serves over one million people.
• Federal or secondary cooperatives - these societies form cooperative federations, meaning that all members are themselves cooperatives.

Each of these cooperative societies plays an important role within their industry to ensure that members are treated fairly and equally to benefit from their investment.

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