Question

Which characteristic best describes cooperative credit institutions?

• A. Profit-driven operations
• B. Member-owned and democratically controlled
• C. Private monopoly
• D. None of the above

Answer 1

Answer:

B. Member-owned and democratically controlled

Cooperative credit institutions are owned by their members (like farmers, small borrowers, or local residents) and operate on democratic principles, where each member typically has one vote, regardless of the amount of capital contributed. They are not profit-driven like private banks, though they aim for financial sustainability. They are not private monopolies. Their primary purpose is serving members’ financial needs rather than maximizing profit.