History of Cooperatives in the Philippines

Submitted by:

ANALYN M. SIOSON BSBA – 4MM

MYERSON CHIN BSBA – 4MM

Submitted to:

TERESITA MAGBITANG Professor

A Filipino travelling in Europe during the later part of the 19th century must have been impressed with the success of new economic movement in effecting a gradual metamorphosis of the economic and social life of the people ion those countries at the turn of the century, Filipinos, in increasing number, traveled and studied abroad and brought from with them new ideas. It was this group of Filipinos who in close in contact wit the new economic movement in Europe. Two names monthly of note were Dr. Jose Rizal and Teodor Sandiko.

One noteworthy group organized by Rizal was the La Sociedad de los Abacaleros (Society and Abaca).

The Rural Credit Law As soon as civil government was

established, Filipino participation in government was encountered. Teodor Sandiko, then governor of Bulacan, prepared a belt patterned after the Ruffeisen type of credit whom and had Rep. Alberto Barreto of Zambales sponsor the bill in the Jomer House of Congress. The principal aim of this bill was to protect and develop the agricultural interest of the country.

The administration of the Rural Credit Law was entrusted to the Bureau of Agriculture the first rural credit association that was organized under this Law was the Agricultural Credit Cooperative Association of Cabanatuan, Nueva Ecija. It was formed on October 18, 1916.

Marketing Cooperatives

The cooperative Marketing Law (Act 2425) was enacted and approved on December 9, 1927. The rural credit associations were designed to help finance. The productive efforts of the formers.

Causes of the failure of early cooperatives in the Philippines

Incompetent management Lack of proper understanding of the principles,

practices true aims, and purposes of cooperative associations

Improper use of credits by the bonomers who, instead of using money borrowed for production, spent it for fristad or luxuries.

Defective securities. Political interference particularly in the collection of

overdue accounts. Lack of compensation of officers Inadequate character and moral responsibility in

handling the other fellow’s money Lack of adequate safeguard against unscrupulous

officers who took advantage of their position to grant loans to themselves and their compadres which later proved disastrous to the system.

The ACCFA Financing Program

The congress of the Philippine in 1952 enacted Republic Act 821. This law established a system of liberal credit which is specially designed to meet the needs of the small farmer

Agricultural Credit and Cooperative Financing Administration (ACCFA) to implement the great task of rural financing four general and interrelated objectives of the law are set forth as follows: To assist small farmers in seaming

liberal credit. To promote the effective groupings

of farmers into cooperative associations

To establish on orderly and systematic marketing machinery for, and controlled by the small farmers.

To place agriculture or a basis of economic equally with other industries.

Types of Cooperation under Republic Act No. 9250 Credit Cooperatives- is one that

promotes and undertakes savings and leading services among its members.

Consumer Cooperative- is one the primary purpose of which is to procure and distribute commodities to members and non-members

Producers Cooperative- is one that undertake joint production whether agricultural or industrial.

Marketing Cooperative- is one which engage in the supply of production input to members and markets their products.

Service Cooperative- is one which engages in medical and dental care, hospitalization, transportation, insurance and other services.

Multi-Purpose Cooperative- combine two(2) or more of the business activities of these different types of cooperatives;

Advocacy Cooperative- is a primary cooperative which promotes and advocates cooperatives among its members and the public through socially-oriented projects, education and training, research and communication, and other similar activities to reach out to its intended beneficiaries;

What are the Categories of Cooperatives? Cooperative shall be categorized

according to membership and territorial consideration. In terms of membership, cooperatives shall be categorized into:

Primary – the members of which are natural person of legal age.

Secondary – the members of which are primaries.

Tertiary – the members are secondary’s upward to one (1) or more apex organizations.

Who can be members of a Cooperative? A cooperative has two kinds of members:

regular members and associate members A regular member is entitled to all the

rights and privileges of membership as stated in the Cooperative Code and the coops’ by laws.

An associate member has no right to vote and he voted upon and is entitled only to such rights and privileges provided by the cooperative’s by laws.

What are the Privileges of a Cooperative?

Cooperative registered under R.A 6938 shall, notwithstanding the provisions of any law to the contrary, be also accorded the following privileges:

Cooperatives shall enjoy the privilege of depositing their sealed cash boxes or containers, documents or any valuable papers in the safes of the municipal or city treasurers and other government offices free of charge, and the custodian of such articles shall issue a receipt acknowledging the articles received duly witnessed by another person;

Cooperatives organized among government employees, notwithstanding any law or regulation to the contrary, shall enjoy the free use of any available space in their agency, whether owned or rented by the Government.

END