Types of Cooperative Societies

Cooperative societies are classified by the specific economic need they are formed to serve:

1. Consumer Cooperative Societies: Formed by consumers to buy goods of daily use directly from producers/wholesalers in bulk and sell them to members at fair, reasonable prices, eliminating middlemen's margins — e.g. cooperative consumer stores that supply groceries and household goods.
2. Producer (Industrial) Cooperative Societies: Formed by small producers — artisans, weavers, craftsmen — who cannot individually afford raw materials, equipment or facilities at competitive prices, so they pool resources to procure inputs and, in some cases, sell their finished output jointly.
3. Marketing Cooperative Societies: Formed by producers (typically farmers) to overcome the problem of getting a fair price for their produce; the society pools members' output, grades and packs it, stores it if needed, and sells it collectively — usually directly to wholesale buyers — so an individual small producer is not forced to accept whatever price a local trader offers.
4. Cooperative Credit Societies / Cooperative Banks: Formed to provide members short-term and medium-term credit at reasonable rates of interest, historically to rescue farmers and small borrowers from exploitative moneylenders — this was, in fact, the very first form of cooperative society to develop in India under the 1904 Act, and remains organised today in a tiered structure of Primary Agricultural Credit Societies, District Central Cooperative Banks and State Cooperative Banks.
5. Housing Cooperative Societies: Formed by persons of limited income to build or acquire houses/flats at reasonable cost, generally by pooling members' savings and securing institutional finance collectively rather than individually. …