A new cooperative bank is in the works for Midrand

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Chairperson for the proposed Midrand Cooperative Bank working group Boitumelo Kgomo. Photo: Andrei van Wyk

MIDRAND – The proposed Midrand Cooperative Bank is calling on the community to get involved in their initiative.

The proposed Midrand Cooperative Bank is growing to give local residents financial freedom.

The project started in April last year. Chairperson of the proposed bank, Boitumelo Kgomo said, “A cooperative bank is almost like a stokvel. It’s a financial institution that is owned and controlled by its members. When you join, you become a shareholder, customer and employee.

“Normal banks are privately owned with the profits shared by the shareholders, where as in a cooperative bank the profits are shared among the members of the banks. On an annual basis, cooperative banks have a general meeting where members can vote on what can be done with the profits of the bank. And unlike normal banks, it is one member, one vote.”

A cooperative bank is governed by the Reserve Bank through the Co-operative Banks Act 40 of 2007 and have to register with the Reserve Bank, which the Midrand Cooperative Bank is currently in the process of doing. At this stage, the project has a 15-person working group who is handling the process of attaining a licence and hosting meetings.

The Cooperative Bank has to go through a four-stage process in order to register with the Reserve Bank. The first stage involves the development of a working group with set goals while also starting a public profile with meetings and a media presence. The second stage involves the drafting of a business plan and constitution and engaging in recruitment by engaging corporates. The third stage involves finalising all documentation for registration with the Reserve Bank, while stage four is the actual registration and ceremonies.

She said that the importance of starting the bank is to give people from Midrand a sense of financial freedom by assisting in saving and business finance. She added that the members involved in the working group have experience in finance and banking, with a very important emphasis on transparency.

She added, “Once the bank is finalised. We will offer basic services like savings with a hope to grow to a point where they offer services such as business finance and personal loans.”

Details: Midrand Coop Bank Proposed info.mcb100@gmail.com

By: Andrei van Wyk