Thiruvananthapuram | Kerala Cooperation Minister M Liju on Friday said the government will expedite legal proceedings to recover funds from individuals found responsible for financial losses in cooperative societies.
In a press conference here, Liju said that surcharge proceedings would be expedited against those responsible for financial crises in cooperative societies, including cases involving corruption, misappropriation, administrative failures, loan fraud and diversion of funds.
According to Liju, the government had launched the 'Vishwas' project to restore credibility in the cooperative sector and identified more than 400 cooperative societies facing a deposit crisis.
The government was scrutinising the financial position of these societies and preparing a comprehensive package to ensure that depositors received their money in a structured and time-bound manner, he said.
"Wherever the fund crisis has occurred due to irregularities such as corruption, misappropriation, administrative failures, loan frauds, diversion of funds and other malpractices, surcharge proceedings against those responsible will be expedited," Liju said.
He said the government would also recover defaulted loans from borrowers and use the collections to repay depositors progressively.
Changes were being proposed to the Deposit Guarantee Scheme so that assistance would not be restricted to societies undergoing liquidation, he said.
On measures to provide relief to borrowers, Liju said settlements worth more than Rs 100 crore had already been completed under the 'Aashwaas 2026' one-time settlement scheme.
The government had relaxed the terms of the scheme and involved MPs and MLAs in committees to make the settlement process more accessible to borrowers, he said.
Society-level committees have been authorised to grant interest waivers of up to 25 per cent. At the Assistant Registrar level, committees including MLAs can grant waivers of up to 35 per cent, subject to approval by the primary society.
Joint Registrar-level committees, which also include MPs and MLAs, can grant up to 50 per cent interest waiver, he said.
A state-level committee would subsequently consider applications recommended by the lower-level committees and provide maximum possible relief, Liju said.
The minister also announced several measures for employees and pensioners in the cooperative sector.
Employees of profitable cooperative societies would receive a bonus of Rs 16,800, while those working in loss-making societies would receive Rs 7,000.
The allowance for commission-based loan collection agents and temporary employees who are not eligible for bonuses has been increased by Rs 700 to Rs 5,500.
The festival allowance for cooperative pensioners has been increased by Rs 400 to Rs 4,500, while the allowance for family pensioners has been raised by Rs 200 to Rs 4,400.
Liju said 235 pending promotions of Cooperative Department employees, which had remained stalled for a year, had been cleared, resulting in 51 PSC appointments.
The government had also decided to provide advance payments towards pending incentives for cooperative society employees who distribute social security pensions, which have been pending since November 2025, he added.