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      Question

      Which of the following is NOT a

      difference between a commercial bank and a cooperative bank?
      A Cooperative banks have dual regulation while commercial banks do not Correct Answer Incorrect Answer
      B Cooperative banks accountholders are also its shareholders unlike commercial banks Correct Answer Incorrect Answer
      C Cooperative banks are larger in size in rural areas than commercial banks Correct Answer Incorrect Answer
      D Cooperative banks motive is primarily service while its is profit for commercial banks Correct Answer Incorrect Answer
      E None of the above Correct Answer Incorrect Answer

      Solution

      Cooperative Banks Commercial Banks
      Co-operatives banks are co-operative organizations. Commercial banks are joint-stock banks
      Governed by the Co-operative Societies Act as well as Banking Regulation Act Governed by the Banking Regulation Act
      Subject to the rules laid down by the Registrar of Co-operative Societies Subject to the control of the Reserve Bank of India directly
      Borrowers are member shareholders, so they have some influence on the lending policy of the banks, on account of their voting power Borrowers of commercial banks are only account- holders and have no voting power as such → Voting power as per shareholding
      Have not much scope of flexibility on account of the rigidities of the bye-laws of the Co-operative Societies Free from such rigidities
      Do not pursue the goal of profit maximization Works for profit maximization
      Smaller in size Larger in size with wider reach in the country

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