MEMORANDUM | UTILIZATION OF CDF, OPTIONAL FUND, GRF AND RELEASE OF ISCPR, LOANS AND OTHER ASSISTANCE TO COOPERATIVE MEMBERS

MEMORANDUM 

TO : ALL COOPERATIVES 

FROM : THE CHAIRMAN 

SUBJECT : UTILIZATION OF CDF, OPTIONAL FUND, GRF AND   RELEASE OF ISCPR, LOANS AND OTHER ASSISTANCE   TO COOPERATIVE MEMBERS 

DATE : March 26, 2020


Amidst the declaration of a state of calamity in the country brought about by  COVID-19, the following guidelines are hereby issued to address the pressing  concerns of cooperatives:

1. MC No. 2020-03, dated March 11, 2020, allowed the postponement of annual general assembly meetings and election of officers in view of  Proclamation No. 922. This, however, would concomitantly result to a  delay in the distribution of the Interest on Share Capital and Patronage  Refund (ISCPR), which, in these trying and uncertain times, are badly  needed by the members. Thus, in keeping with the cooperative principle  of self-help and mutual help, early distribution of ISCPR will be allowed,  subject to adjustments, when necessary.

Nonetheless, in view, of the mandatory directive prohibiting mass  gatherings, cooperatives are reminded to explore alternative means to  distribute the ISCPR so as to ensure that the distribution process  observes the enhanced community quarantine for COVID-19 under the  guidance of local authorities and observing strict physical distancing.

2. Cooperatives are strongly encouraged to utilize their Community  Development Fund (CDF), which under Article 86 (3) of R.A. No. 9520,  shall not be less than three per centum (3%) of their net surplus, for  projects or activities that will benefit the community where the  cooperative operates. These projects or activities are those identified  and included in the approved Social Development Plan with the  exception, however, of those undertaken in response to the COVID-19  pandemic to reinforce prevention and control actions of the  government.

Food packs, vitamins, alcohol, soap and other basic necessities may be  distributed to those community members who are in dire need of help but with adherence to safety protocols, and ensuring that the  procurement of these goods will not shortchange the members.

3. The Optional Fund, which under Article 86 (4) of R.A. No. 9520, shall  not exceed seven per centum (7%), may also be utilized by the  cooperative, if warranted by the circumstances, for the benefit of its  members and employees. This, however, must later on be confirmed by  the General Assembly.

If the cooperative chooses not to use its Optional Fund or if the same is  not sufficient for the intended aid purpose, additional fund assistance  may be charged to direct expenses.

With respect, however, to accumulated Reserve Fund, Article 86 (1)(a)  of the same Act is clear that same shall be used for the stability of the  cooperative and to meet net losses in its operations. Thus, in the event  that the cooperative incurs a loss during the year on account of this  crisis, only then may the Reserve Fund be used to absorb this loss.

4. Emergency or calamity loans at interest-free or minimal rates of interest  may be extended to enable the members to meet their needs, subject to  the lending policies of the cooperative.

5. Cooperative-owned vehicles and properties may be made available for  use by members of the cooperative or community especially during  emergency situations, in coordination with local government units.

While we commiserate with the plight of the cooperatives and millions of their  members during these trying times, we are at the same time mindful of  everyone’s paramount right to public health and safety. Hence, all acts  undertaken in consonance with the above guidelines should be done within  the context of social distancing and quarantine-related measures.

We are uncertain as to how long the dreaded COVID-19 Pandemic will last. In  the meantime, let us do whatever we can to help and let the members of our  cooperatives and community feel that they are not alone during these tough  times.

For your guidance/information.

(SGD)ORLANDO R. RAVANERA, CSEE, CEO VI


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