In a major development, Nabard authorized the Maharashtra State Cooperative (MSC) Bank to provide short-term refinancing to Primary Agricultural Credit Cooperative Societies (PACCs), linked to DCCBs that are weak or unable to finance them.
MSC Bank can only refinance PACCs that are members. The bank has now convened the special general meeting by videoconference on February 28, 2022 to make the respective amendments to MSC Bank’s articles of association.
In statutes no. 14(a) new sub-clause (vi) should be added because, is a PACC borrower who is a member of the respective DCCBs and to whom said DCC bank has issued a certificate of no objection to become a member of category “B ” form the bank. After making changes, it will be sent to the Registrar of Co-operative Societies for approval, and I hope the process will be started early in the next fiscal year.
A euphoric Chairman of the Board of MSC Bank Vidyadhar Anaskar said, “We got approval after 2.5 years and this milestone will not only help PACCs but also DCCBs to generate revenue.
“Out of 31 DCCBs in the state, five DCCBs are not in good financial condition and their NPA exceeds 70%.” NPAs of six DCCBs including Beed, Nagpur, Osmanabad, Buldana, Wardha are reported to be of concern,” he underlined.
“In view of the difficulties faced by eligible farmers, MSC Bank had developed a unique program to provide direct loans to farmers through eligible primary agricultural companies and the corresponding policy was submitted to NABARD for approval,” said- he recalled.
He added that the loans will be monitored by the relevant DCC banks. These banks will also assist MSC Bank in the management of these accounts and the collection of crop loans. One percent of the recovery amount will be paid to these DCC banks as a service fee. This is the first such program in the country,” Anaskar informed.
There are 21,000 PACCs in the state and an average of 900 farmers are linked to each PACC.
The Maharashtra State Cooperative (MSC) Bank had made a net profit of Rs 369 crore in the 2020-2021 financial year, the highest ever in the history of the bank.