People collect money from acquaintances, form a credit society, become its chairman and then give out loans indiscriminately, he said.
Goa Chief Minister Pramod Sawant said here Tuesday that the state government was considering imposing a freeze on registration of new cash-credit societies for five years to prevent frauds. There are “too many” cash credit cooperative societies in the state, Sawant said, speaking at a workshop organised by the National Cooperative Development Corporation.
“We are looking at (the possibility of) legally shutting them down (stopping registration of new societies) so that the experience of frauds witnessed in the past is not repeated,” he said.
People collect money from acquaintances, form a credit society, become its chairman and then give out loans indiscriminately, he said. “The society later runs into financial trouble and shuts down in two years, losing investors’ money,” he added.
“There are enough of them already. If someone wants to start a new society, they may consider taking over those (the existing ones) which are willing to sell,” the chief minister said.
He was also checking the possibility of banning outsiders from setting up cooperative societies in Goa, especially the likes of which promise to double depositors’ money in quick time, Sawant said.