Co-operative Bank: When some persons join together to form a society and start accepting deposits and provide loans to their members then that society is known as Co-operative Bank or Co-operative Credit Society. The main objective of the Co-operative Bank is to provide financial assistance to people who are poor and do -not have any resources. These banks accept small deposits from the members and often ask the members to subscribe to the share capital of the bank.

The bank helps the members of the bank by giving them loans for productive needs from time to time.

Importance of Co-operative Bank: 

The main object of Co-operative Banks is to provide financial assistance to poor. 

Following are the main advantages of Co-operative Banks:

1. The rate of interest charged is low and the needy have not to go to the moneylenders for financial assistance. 

2. The people develop the habit of saving. 

3. The members gain confidence as all of them work with the Co-operation of each other. 

4. People become independent and they have not to depend on others. They also develop a feeling of responsibility.

5. Agriculture and industry receive encouragement. 

6. People are encouraged to utilise their money for productive functions. 

7. Development of agriculture and cottage industries makes the farmers financially sound.