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Sources of Fund of Cooperatives

This document outlines various internal and external sources of funds for cooperatives. Internally, cooperatives can generate capital through share capital contributions from members, revolving capital certificates, capital reserves set aside from annual net surplus, deposits and loans from members, cooperative guarantee funds, fees, fines, and subsidies or donations from members. Externally, cooperatives can take loans at favorable terms, receive subsidies, grants or donations from foreign and domestic sources, and utilize other sources authorized by law such as advances from customers or funds from activities.

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499 views12 pages

Sources of Fund of Cooperatives

This document outlines various internal and external sources of funds for cooperatives. Internally, cooperatives can generate capital through share capital contributions from members, revolving capital certificates, capital reserves set aside from annual net surplus, deposits and loans from members, cooperative guarantee funds, fees, fines, and subsidies or donations from members. Externally, cooperatives can take loans at favorable terms, receive subsidies, grants or donations from foreign and domestic sources, and utilize other sources authorized by law such as advances from customers or funds from activities.

Uploaded by

cedricXXX
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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SOURCES OF

FUND OF
COOPERATIVES
I. Internal Sources

1.Share capital (owned).


The member contributes in the
capitalization in the form of shares
with a par value of an amount
stated in the by-laws.
Equity Capital
Allocated
Unallocated

Debt Capital
Short term
Long term
2. Revolving capital.
Another way of generating capital
is o defer payment of interest on share
capital and patronage fund.The Board
shall issue revoving capital certificate
with serial number,name,amount and
rate to be paid at time of retirement.
3.Capital reserve.
At least ten percentum (10%) of the annual net
surplus shall be set aside for reserve fund for
the stability of the cooperative.
4.Deposits of members or loans
from members.
The cooperative may receive
two kinds of deposits.
a. Savings deposits; and
b. Time deposit
5. It may also borrow from
members at terms
comparable or less
onerous than loans from
outside sources.
6.Cooperative guarantee fund.

At least % of the gross income /surplus of the


cooperative shall be set aside to constitute the
Cooperative Guarantee Fund which shall be a social
fund for the purpose of guaranteeing the realization of
the objectives of the cooperative, payment of common
services and facilities for the benefit of the members,
and for investment in other cooperatives.
7.Fees( membership and
transfer),fines,etc.

8.Subsidies,grants and
donations. The cooperative may
also accept from members
subsidies grants and donations.
II. EXTERNAL SOURCES

1.Loans.
The cooperative may borrow from
external sources to supplement the
members share capital contribution but
it must not compromise the
cooperatives autonomy and
independence. It must be at best terms
and conditions available.
2.Subsidies,grants and donations.

Among the powers and capacities


granted to cooperative by Article 9,RA 6938
is to accept and receive grants, donations
and assistance from foreign and domestic
sources.
3. Other sources of funds as
may be authorized by law.

Example:
Advances from customers
Fund-raising activities

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