Government in Kerala considers merging its co-op banks

The government of Kerala is consulting on the possibility of merging all existing co-operative banks into one single co-operative organisation. The move is aimed at widening the reach...

The government of Kerala is consulting on the possibility of merging all existing co-operative banks into one single co-operative organisation.

The move is aimed at widening the reach of co-operative banks in the southern Indian state. A committee is being set up to look into the idea and how best to implement it.

Speaking during his Budget speech, Kerala finance minister T. M. Thomas Isaac spoke about the potential merging of district and state level co-operative banks to form one bank.

Mr Isaac said funds had been allocated for a committee to help prepare a recommendation on the matter.

He said: “This bank, which [if merged] will have the largest number of branches in the state, can play an important role in its development”.

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Currently, there are 936 branches of co-operative banks in Kerala – 750 branches of district co-operative banks, 20 branches of the Kerala State Co-operative Bank, and 166 branches of Kerala State Co-operative Agricultural and Rural Development Bank.

The first co-operative bank in Kerala was registered in 1915 – the Trivandrum Central Cooperative Bank. When Kerala was established as a state in 1956, the bank was elevated to the Kerala State Cooperative Bank (KSCB) and became the apex bank for other credit co-ops.

KSCB’s stated mission is “to remain as the strong, sound and leading organisation in the co-operative credit union structure and to be the backbone for the rural financial sector of Kerala.”

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