Introduction
Bank for cooperatives is a regional bank that is privately-owned, and government-sponsored. It provides loans for farmer-owned marketing, rural utilities, and supply and service of cooperatives.
Being a part of the Federal Farm Credit System (FFCS), these banks offer short-, intermediate-, and long-term loans for agricultural processes. They are also known as the Agricultural Credit Bank (CoBank). The bank is set up as the traditional lenders consider agriculture to be a high-risk business.
Understanding Bank for Cooperatives
The duties include authorising loans and financial commitments to individuals and businesses involved with agriculture. The members of such bank jointly share the risks and profits made out of the bank activities.
The key principles of the bank include:
- Voluntary and open membership.
- Democratic control.
- Provide training, education, and information to members and the general public.
- Strive for sustainable development of the customers.
