One reason is that these banks are not sufficiently technology-enabled to participate in the technology driven Financial Inclusion Programme. To redress this handicap, as part of its mandate of institutional development, NABARD has embarked on an ambitious effort to bring the cooperative banks on a common technology platform in a phased manner.
A lot of work has been undertaken to assess the quality of these assets and to ensure both that adequate capital is held against them and that adequate accounting provisions are held (following new guidance from the Central Bank).