Banking Khabar / The Nepal government is set to begin returning savings to thousands of victims affected by the country’s cooperative crisis starting from the first week of Jestha, offering long-awaited relief to small depositors who lost their money in troubled cooperatives.
According to government officials, around 58,000 small savers will receive refunds as authorities intensify efforts to compensate victims of cooperative fraud. More than 76,000 people have already registered complaints with the Problematic Cooperative Management Committee, claiming they were defrauded by various cooperatives across the country.
The committee estimates that nearly Rs 46 billion was misappropriated from these depositors.
Under the government’s classification, individuals with savings below Rs 500,000 are considered “small depositors,” while those with deposits exceeding that amount fall under the category of large depositors. Of the total registered victims, around 18,000 are identified as large-scale savers.
Officials from Ministry of Land Management, Cooperatives and Poverty Alleviation said the refunds will be distributed through a revolving government fund created specifically to address the cooperative crisis. Authorities are also continuing to collect data and details from additional affected cooperatives nationwide.
Government Announces Major Cooperative Sector Reforms
Alongside the refund process, the government has announced sweeping reforms aimed at overhauling Nepal’s cooperative sector and restoring public trust.
Through a new cooperative-related ordinance, the government has pledged to make cooperative operators more accountable and legally responsible for depositors’ money. Under the proposed reforms, assets belonging to cooperative operators accused of embezzling public savings can now be frozen.
The ordinance is expected to bring savings and credit cooperatives under stricter regulatory supervision. It also introduces a ban preventing cooperatives from charging interest rates higher than loan limits and reduces the maximum dividend payable to shareholders from 18 percent to 15 percent.
In tougher enforcement measures, authorities will also have the power to freeze passports, bank accounts, and personal assets of cooperative operators found responsible for financial misconduct. Officials say the move is intended to stop accused operators from fleeing abroad or hiding illegally obtained assets.
The reforms mark one of Nepal’s strongest crackdowns on cooperative fraud in recent years, as the government faces mounting pressure from thousands of victims demanding justice and financial recovery.
