10 Types of Cooperatives in Indonesia Based on Their Business, Get to Know the Examples

Kapanlagi.com - Are you still unfamiliar with the word 'cooperative'? The word 'cooperative' comes from the English word 'co-operation', which means collaboration. Cooperatives are understood as legal entities established based on the principle of kinship and adhering to the principles of people's economy. The purpose of establishing cooperatives is solely to improve the welfare of its members. So, all the profits obtained by the cooperative will be managed for the progress of the cooperative's performance. Anyone can establish a cooperative, both individuals and legal entities. The capital for this cooperative business is obtained from all its members, so the operation of this business must adjust to the aspirations and common needs.

In running their business, there are various types of cooperatives. There are three groups of cooperatives, the first is Production cooperatives, Consumer cooperatives, Savings and Loan cooperatives, and General Business cooperatives grouped based on their types of business. The second group of cooperatives includes Civil Servant cooperatives, Market cooperatives, Village Unit cooperatives, and School cooperatives grouped based on their membership. And the last group of cooperatives includes Primary cooperatives and Secondary cooperatives grouped based on their levels. To make it easier to understand, here is an explanation of 10 types of cooperatives based on the three groups.

1. Production Cooperative

Types of cooperatives in Indonesia (credit: flickr)

A production cooperative is a type of cooperative that engages in production or the creation of goods. This type of cooperative usually consists of micro and medium-sized entrepreneurs who are involved in the procurement of raw materials and assist their members in solving business problems. Examples include farmer cooperatives and fisherman cooperatives. These cooperatives help provide the necessary raw materials for their members and market the products they obtain.

2. Consumer Cooperative

A consumer cooperative is a cooperative that provides all the needs of its members in the form of goods. The goods provided include daily necessities such as rice, oil, eggs, flour, sugar, and others. Members who make purchases receive discounted prices compared to non-members.

3. Savings and Loan Cooperative

Savings and Loan Cooperative (credit: flicker)

The next type of cooperative is the savings and loan cooperative. The savings and loan cooperative provides money loans and also money storage. This cooperative is well-known and widely followed by the community because by becoming a member of the savings and loan cooperative, one can easily obtain money loans. At first glance, the way this type of cooperative works is similar to a bank. However, the difference between a savings and loan cooperative and a bank lies in the loan interest.

The savings and loan cooperative provides lighter loan interest compared to banks. And the repayment of loan funds in the savings and loan cooperative can be done according to mutual agreement. Eventually, the obtained loan interest will be distributed to all its members through a profit-sharing system.

4. Multipurpose Cooperative

Multipurpose cooperative is a type of cooperative that has various businesses. It can be said that this cooperative is a combination of previous types of cooperatives. Examples of business cooperatives are transportation cooperatives and electricity cooperatives. The form of this cooperative's business is more flexible, making it one of the appropriate solutions to maximize the welfare of its members.

5. Civil Servant Cooperative

Civil servant cooperative is a cooperative that has members who are civil servants, both central government employees and regional government employees. The main goal of the civil servant cooperative is to improve the welfare of its members and civil servants connected to the cooperative.

6. Market Cooperative

Types of cooperatives (credit: flicker)

Market cooperative is a cooperative that has members who are market traders. Its goal is to improve the welfare of market traders by providing them with loan funds as capital for all traders.

7. Village Unit Cooperatives

Village unit cooperatives (KUD) are cooperatives that have members from rural communities. These cooperatives usually engage in economic activities related to agriculture or fisheries.

8. School Cooperatives

Types of cooperatives (credit: flicker)

School cooperatives are cooperatives that have members consisting of all school residents, such as teachers, employees, and students. School cooperatives provide school equipment at a cheaper price, ensuring the needs of students and teachers are met.

9. Primary Cooperatives

Primary cooperatives are cooperatives that have individual members. The minimum number of members for this type of cooperative is 20 people. In its implementation, each member must fulfill the requirements of the basic rules and have the same goals.

10. Secondary Cooperative

The last type of cooperative is a secondary cooperative, which is included in the cooperative group based on its level. A secondary cooperative is a type of cooperative that consists of a combination of primary cooperative bodies and has a wider scope of work area compared to primary cooperatives. Each cooperative must have the same interests and goals in order to make activities more efficient.

Cooperatives have been a savior of Indonesia's economy during the 1988 monetary crisis. When cooperatives can help Indonesian society, it means that the country's economy will also develop. However, at present, the community must also be cautious when wanting to register as members. Make sure you choose cooperatives that are only officially registered with the Ministry of Cooperatives and Small and Medium Enterprises or the Financial Services Authority (OJK), to avoid fraud by fake cooperatives.

(kpl/dtm)