Co-operative societies have the following merits:
1. Equality in Voting Status –
Every member, despite his/her capital investment. has equal voting rights.
2. Limited Liability –
Every member has a limited amount of liability on the basis of his/her capital investment. The loan cannot be repaid from his/her own property.
3. Stable Existence –
Due to its stable existence, there is no effect of death, retirement or insolvency of any partner.
4. The economy in operation –
The members of the committee provide common and unpaid services, in fact, most of the members are in the committee only. This prevents bad loans too.
Limitations of Co-operative movement:
1. Limited Resources –
Every member of the Co-operative movement has a limited number of, and thus has a limited amount of resources.
2. Inefficiency in management –
Cooperative committee works on lesser salary and therefore they do not get good managers and the ones who provide their time to them are not professionals.
3. Lack of Secrecy –
According to the co-operative Movement Act, Section 7 every subject is discussed in open and the committee has the right to make its ideas public. Therefore the secrecy is breached.
4. Government Control –
Co-operative societies are provided with facilities by the government. And in return, they have to follow all the government rules. It is thus controlled by state Co-operative society. This results in a negative effect on their activities.
5. The difference of opinion –
The difference of opinion in the members sometimes makes it impossible for them to come to a conclusion. Some members pay attention only to their personal Interest.
