Deposit Schemes of CCL
CCL in its essence is an interest free financial organization, designed to help its members to save, invest and borrow in accordance with the universal principles of social justice and mutual cooperation. The cooperative does not accept money from its members in a conventional form on the promise of interest returns. It has devised its own deposit schemes in accordance to its own debit credit policy which is guided by ‘Sharia’ principles.
Following are a few deposit schemes offered by the Cooperative.
- Saving Deposit Scheme (SDS):- The main aim of this scheme is to inculcate the culture of savings and thrifts among the members of the cooperative. Further these accumulated savings can be used by such members to cater their needs which are not otherwise possible to be attended to.
Rules and Regulations Governing SDS
i. Deposits under this scheme will be accepted by the cooperative from its members on the principle of simple credit (Dian i.e. Karz)
ii.The depositors will have no right to claim any surplus from the cooperative on these deposits.
iii. The principal amount of the depositor will be guaranteed by the cooperative.
iv. The Cooperative out of its own will may pay some of its gains to such depositors as Voluntary Gift Return (VGR)
v. The VGR (If any) will be paid to depositors in proportion to the quantum of their deposits.
vi. For calculation of VGR the deposits from 1st to last date of a particular month will be taken as principle for such VGR.
vii. The VGR will be credited to the depositor’s accounts as and when such returns are announced by BOD.
viii. Any amount in the multiples of 100 will be accepted under this scheme.
ix. These deposits can be claimed at any time by the depositor.
x. A depositor can also deposit his savings for a fixed period of time (at least one year). Such deposits will be called as Fixed Saving Deposits (FSD)
xi. The FSD will be paid VGR at double rate fixed for normal saving deposits.
xii. The deposits received under saving scheme (Normal / Fixed) will be utilized by the cooperative in any of its business projects.
2. Investment Deposit Scheme (IDS):- The main aim of this scheme is to help its members to invest their surplus in gainful projects in order to contribute their bit in the economic development of the society.
Rules and Regulations Governing IDS:
i. These deposits will be accepted by the cooperative as investment (term) loan on the principle of partnership (Sharakat) between the cooperative and the depositor.
ii. These deposits will have due share in the gains and losses (if any) of the business of the cooperative.
iii. The least term of such deposits will be two years.
iv. Any amount in the multiples of 1000 will be accepted under this scheme.
v. Total sum of such deposits will be calculated on the basis of complete calendar months, any part of a calendar month will not be considered.
vi. Profit loss calculations will be made annually and distributed among the depositors (as decided by BOD) on the basis of their monthly deposit investments
vii. The deposits received under the scheme will be invested by the cooperative in any of its short/ long term business projects.
3. Safe keeping accounts scheme (SAS):- The main aim of this Scheme is to provide a facility of safe keeping, to the members of the cooperative, for the funds of the institutions run by them.
Rules and regulations governing SAS
i. Deposits under this scheme will be accepted by the cooperative from the institutions run by its members (who need such facility for the safety of the surplus funds of institutions, organizations and business ventures run by them) on the principle of ‘Wadiah’ i.e. safe keeping of funds with a special permission to use these without any loss incurred on deposits.
ii. Such deposits will not be paid any surplus by the cooperative.
iii. The deposits will be accepted in any denominations.
iv. The deposits will be guaranteed by the cooperative and made available to the depositors with a prior notice of five days.
Financing Schemes of CCL
CCL in its essence is an interest free financial organization. It does not lend money to the prospective borrowers in a conventional manner as the modern commercial banks do. It tries to cater the financial needs of its members in accordance with the broad guidelines of ‘Sharia’ rules of ‘Bia’, Ijarah, Musharika, Mudariba etc.
Following are a few financing schemes offered by the cooperative:
- Consumer Goods Financing Scheme (CGFS)
This scheme is based on the principle of “Bia Salam’ i.e. Credit Sale agreement. The main aim of this scheme is to help its members to purchase any of the house hold gadgets / appliances / means of Pvt. transport etc. when such consumer goods are seriously needed by the members but are beyond their “Current Purchasing Capacity”. Under this scheme, on the request of the member, the cooperative purchase such required gadgets etc from the open/wholesale market and then sells the same to the concerned member (Prospective Borrower) at a retail selling price under a credit sale agreement (Bia Salam) against easy monthly installments (EMI).
Rules and Regulations Governing CGFS:
i) Purchase of almost every house hold gadgets/ any of the consumer goods can be financed through this scheme under the principle of ‘Bia-Salam’
ii) The prospective borrower will make a written request to the cooperative on a prescribed format for supply of the required gadget/ appliances etc.
iii) The cooperative may ask the Prospective borrower to deposit 10% of the estimated cost with the cooperative as a token of his seriousness for making the purchase.
iv) The cooperative after purchasing the required item from the market will sell the item on credit to prospective borrower on a well defined retail selling price.
v) The borrower will be required to provide a third party guarantee and hypothecation of sold item for a period till transaction is complete.
(The Borrower will be asked to provide a third party guarantee or hypothecation of the purchased gadget or the both, keeping in view the value and form of the gadget under sale)
vi) The Easy Monthly Installments (EMI) will be mutually finalized by the cooperative and the borrower.
2. Income Generating Schemes (IGS)
This scheme is designed to help members of the cooperative to launch their own income/ employment generating projects in order to become self employed and employers also. Under this scheme trading centers, manufacturing units and craft centers etc can be financed. Finances for this scheme are provided under the principles of Mazarabit (Partnership of Capital and Labour) and Musharikah i.e. Joint ventures.
Rules and Regulations Governing IGS:
i) The prospective borrower will make a request for the credit to be obtained under this scheme on a prescribed form – Indicating different features of the credit to be obtained viz. a) Amount Required. (b) Type of Credit i.e. Mazaribat / Musharikah (c) Mode of Business (d) Period of duration. (e) Mode of Recovery (f) Mortgage (g) Guarantee (Third Party / Hypothecation etc.) (h) Cooperative’s Share of Profit etc.
ii) The plan of business project with the necessary technical specifications and the document of conditions (specifying recovery etc.) as laid by the cooperative and duly accepted and signed by the prospective borrower will be required to be enclosed with the request form.
iii) The proposal if found consistent, after recommendations of the technical experts, the credit in favour of the prospective borrower will be sanctioned by the BOD.
iv) After sanctioning of the credit by BOD, the prospective borrower will furnish a letter of guarantee (on a prescribed format) from the proposed guarantor, recommending to BOD the disbursement of the sanctioned loan on his personal guarantee and making a promise to the cooperative that he (The Guarantor) himself will pay to the cooperative the whole or any part of the credit and the profits earned by the credit, in case the borrower fails to pay back the said dues to the cooperative within the stipulated time period.
v) The credit will be disbursed to the borrower against a proper receipt and a letter of affirmation, promising the repayment of the credit along with the earned profits in accordance to the terms and conditioned laid by the cooperative and accepted by the incumbent.
vi) The borrower will be bound to furnish the details of his business transactions to cooperative on fortnightly basis, till the credit is liquidated completely.
3. Agricultural Inputs Scheme :(AIS) :-
Under this scheme, such members of the cooperative will be covered who need finances for development of land for agricultural purpose and or for purchase of inputs like seeds , fertilizers, pesticides and labour for different crop seasons and are not able to acquire these items under CGFS of Cooperative. Such members can obtain required funds (credit) from the cooperative with a promise that the borrower will sell his produce to the cooperative at agreed rates of the crop, at least to the extent of his credit amount. In this scheme ‘Bia salam’ principle of Sharia is practiced, in which cost of crop at agreed rate is paid in advance by the purchaser to the farmer and the produce is delivered by the farmer to the purchaser at the time of harvest.
Rules and Regulations Governing AIS:
i) The Prospective borrower will make a request for the credit on a prescribed form.
ii) The document of terms & conditions (mentioning cost of produce and its delivery) will be finalized and accepted by the borrower.
iii) The Borrower will furnish to the cooperative, the letter of Guarantee from a third party on the prescribed format.
iv) Funds will be disbursed to the borrower against a proper receipt and a letter of affirmation, promising the delivery of the produce at the cooperative office in a marketable condition at agreed rates and terms & conditions, at least equal to the value of the amount of credit.
Note : However fresh fruits crops like apples , pears etc. cannot be financed under this scheme at present due to lack of storage infrastructure and wide variations in crop quality.
4. Kashmir Crafts Development Scheme (KCDS)
This scheme is specially designed to help the artisans of Kashmir having requisite knowledge and required skills about any of the indigenous or adopted crafts of Kashmir for establishing production units and training centers. Two options are available under this scheme:
a) Artisans Owned Units: If a member of the Cooperative wishes to establish a Craft Center (either production or training) of his own, such centers will be provided finances under the rules and regulations which govern the employment generation schemes (EGS) of the cooperative.
b) Cooperative Owned Units: If an artisan is not willing to establish a unit under his own ownership, he can opt for cooperative owned units. For such units the artesian will be engaged by the cooperative as a skillful worker for managing the unit and will be paid remuneration by the cooperative monthly on contract basis, either in lump sum or in proportion to the production.
5. Ijerah Scheme of Financing (ISF):-
Ijerah means obtaining the usage rights of a gadget against payment of an agreed rent. A member willing to avail the benefits under this scheme, will have to make a formal contract with the cooperative that he (the member) will use the required gadget for a certain period against a rent as decided by the cooperative. Under such contract, the cooperative will purchase the required gadget and provide the same to the concerned member on rent as specified in the contract between the member and the cooperative.
6. Cash Credit Scheme (CCS):
Some times a member of the cooperative may need finances for such genuine needs which are not covered under any of the schemes offered by the cooperative, in such a special case a cash credit, equal to the double of his compulsory investment deposit can be sanctioned in favour of such a member once in a financial year, without any type of excess incurred on such credit and to be liquidated within 2 months in at most two equal monthly installments. The period for which the member will avail such a credit facility he (the member) will not be entitled of any gains of the cooperative, however, he has to share the losses of the cooperative if any during such period.
7. Fair Price Shops and Other Public Friendly Establishments:
In addition to the schemes described above for providing finances to the members of the cooperative, the cooperative itself may invest in its own income generating projects like Fair Price Shops and Other Public Friendly Establishments etc. which will be managed by the skilled and experienced staff.