Lok Sabha Question No. 3471 (UNSTARRED), answered on 2024-12-17
Subject: Credit Flow in the Cooperative Sector
Ministry: COOPERATION
Asked by: Shri Janardan Singh Sigriwal

## GOVERNMENT OF INDIA MINISTRY OF COOPERATION

## LOK SABHA UNSTARRED QUESTION NO.3471 TO BE ANSWERED ON 17 th  DECEMBER, 2024

## Credit Flow in the Cooperative Sector

## 3471. Shri Janardan Singh Sigriwal:

Will the Minister of Cooperation ( सहकारिता मंत्री ) be pleased to state:

(a) the manner in which the long-term loan structure works for credit flow in the Cooperative sector;

(b whether the farming banks/agricultural banks work in the form of cooperative societies; and (c)  the  names of the States across the country where farming banks are functional and the details of the extent of their country-wide presence?

## ANSWER

## THE MINISTER OF COOPERATION सहकारिता मंत्री (SHRI AMIT SHAH)

(a): The Long-Term Cooperative Credit Structure (LTCCS) through Agriculture and Rural Development Banks (ARDBs) has been in operation primarily through two structural variants Viz., Federal and Unitary.

Federal  structure  follows  the  principle  of  organizing  cooperative  at  base  level  and accordingly Primary Credit Agriculture and Rural Development Banks (PCARDBs) have been organized at district, block or taluk levels as standalone cooperative societies. All these societies federate  at  state  level  to  form  State  Credit  Agriculture  and  Rural  Development  Banks (SCARDB) as the apex society for provision of long-term loan to farmers. Under this structure, farmers or ultimate borrowers are members of a PCARDB and secure loans from the PCARDB. The  PCARDBs,  as  members  of  SCARDB,  get  their  loans  refinanced  from  the  SCARDB. SCARDBs exercise control over PCARDBs through their supervisory units and in some states PCARDBs have even opened a few branches.

The Unitary structure on the other hand operates as a state level ARDB with a branch network all over the state to provide credit to farmers. In order to supervise the functioning of the branches, SCARDB have also established regional offices at appropriate locations.

These banks advance mainly long-term loans of 5 to 15 year tenure for investments in agriculture  and  rural  sectors  on  the  security  of  land.  Minor  irrigation,  farm  machinery, plantation and horticulture, Rural housing, rural non-farm sector activities etc are main purposes for which loans are given. These institutions don't have banking licence and depend mainly on national level public financial institutions like NABARD and NCDC for funding support.

(b): SCARDBs & PCARDBs are cooperative societies registered under the state cooperative societies  Act  in  various  states  except  in  the  case  of  Bihar  &  Jharkhand  SCARDB  which  is registered under Multi State Cooperative Societies Act.

(c): At present, out of 16 SCARDBs, 13 SCARDBs are functional with a network of 1,868 PCARDBs/branches of SCARDBs at ground level. These banks have a total membership of 1,02,79,500  rural  households.  The  States  where  13  SCARDBs  are  functioning  are  Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Kerala, Punjab, Rajasthan, Tamil Nadu, Tripura, Uttar Pradesh, West Bengal and Union Territory of Puducherry.

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