Being local in nature and intricately interwoven with the local community, the co-operatives have a clear advantage over the proposed SFBs. It is easier for them to create trust among its target community and bring customers within their fold.
Even though cooperative banks’ share in total agricultural and urban credit has come down over the years in terms of amount, they are the leaders in terms of the number of smallticket loans which commercial banks hesitate to take up on account of high cost of servicing small value accounts. 16.