How cooperative loans are approved and repaid
A cooperative loan passes through a request, approval, disbursement and repayment, and trouble starts when any stage lives in a different book. KoopManager keeps all four in one system, with an audit trail on each approval and repayments applied to the oldest loan first.
What happens to a cooperative loan
A member asks for a loan, the Exco or its administrators approve it, the money is disbursed, and the member repays over time. Eligibility, limits and terms are set by each society's bye-laws, so this guide is general information, not legal or financial advice.
The problem: nobody can trace a loan from decision to payment
Requests arrive by phone or on paper, approvals are given in a meeting or a message, and repayments are matched by hand. Months later nobody can say who approved a loan, what is still owed, or which loan a payment was meant for.
Who feels it
- Members dispute balances that no one can trace to a decision or a payment.
- Officers are asked to justify approvals and repayment figures they cannot reproduce, and spend each month end reconciling loan records.
How KoopManager resolves it
Members apply from their own portal, and requests, approvals, disbursements and repayments are handled in one place. Due repayments are processed by date and applied to the oldest loan first. Approvals carry an audit trail, and a reversal is posted as a mirrored entry, never an edit or a deletion.
The loan book report then shows the portfolio with aging risk analysis, so the Exco meets with current numbers.
Related guides
- How to move a cooperative society from spreadsheets to software
- Cooperative loan guarantees explained
- How cooperative dividends work
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