What are the Principles of co-operative society?

The Principles of co-operative society.

The followings are some of the principles on which a co-operative organization stand:

European Law Society

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Voluntary association: The membership of a co-operative organisation is voluntary and open to all adult persons having common interest.  Any person can become a member of the organization irrespective of caste, creed, colour, sex and religion.


Autonomy: A co-operative society is a self-governing institution. It enjoys the status of autonomy because it is self-sufficient, self-renewing and self-controlling organization. It has a continuous existence because it is not affected on the death of any member of the society.

Capital: The capital of a co-operative organization is raised from its members in the form of share capital. As the share capital is not sufficient to meet its operational cost, it borrows loan from the government or apex co-operative organization.

Service motive: It is organized to render service to its members and not to make profit.

Democratic management: The management of a co-operative society is done on democratic line. The management is vested in the bands of a managing committee elected by the members. The general body of the members determines rules and regulations for the management, the managing committee functions within the framework of the principles framed by the general body.


Government control: The co-operative organization are subject to the rules and regulations of the government because it is registered under the Co-operative Societies Act, 1919.

Status of the members: In co-operative society, each member is given one vote irrespective of number of shares held by him. In this organization no body can control the society on the basis of his share capital.

Distribution of surplus: The income of the co-operative societies are distributed among the members on the basis of their capital contribution. According to Co-operative Societies Act, 1919 the rate of divided is limited to 9 percent.

Cash trading: The trading operation of the co-operative society is done on the basis of cash. It never allows the principles of credit in its trade practice.


Mutual help: It always aims at developing the spirit of co-operation among the members. Every member of the society is required to act for the maximum benefit to other members. It is based on the principle “all for each and each for all”.

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