14-Dec-2022: Utility of PACS

PACS constitute the lowest tier of the short-term cooperative credit structure in the country at panchayat/ village level. They serve as a crucial link in sustaining the rural economy of the country by providing short-term and medium-term credit and other input facilities such as fertilizers, pesticides, seeds, etc. to farmers. There are nearly 95,000 PACS in the country, with a member base of around 13 crores. These are refinanced by NABARD through 351 District Central Cooperative Banks (DCCBs) and 34 State Cooperative Banks (StCBs). The StCBs and DCCBs together provide nearly ₹ 5 lakh crore rural credit annually, out of which ₹ 1.3 lakh crore is refinanced by NABARD.

In order to improve transparency, increase efficiency, ensure speedy disbursal of loans, have seamless accounting with DCCBs and StCBs and reduce imbalances in payments, a project for Computerization of 63,000 functional PACS in three years with a total financial outlay of ₹ 2,516 Crore has been approved by the Cabinet Committee on Economic Affairs vide its decision dated 29th June, 2022. This project entails bringing all the functional PACS onto an ERP (Enterprise Resource Planning) based common software, linking them with NABARD through StCBs and DCCBs. Implementation of Common Accounting System (CAS) and Management Information System (MIS) would enable PACS to carry out their operations online and obtain refinance/ loans from NABARD through DCCBs and StCBs. Presently, the economic activities undertaken by PACS are restricted by their respective byelaws, which in most cases, have become outdated and need to be revised. In order to strengthen the PACS and diversify their business activities to make them vibrant economic entities at Panchayat level, model byelaws of PACS have been prepared by the Ministry after consultation with all the States/ Union Territories, Ministries/ Departments concerned in Government of India, NABARD, NAFSCOB, State Cooperative Banks, District Cooperative Banks, etc. These Model byelaws of PACS will enable them to undertake more than 25 business activities which, inter alia, include dairy, fishery, floriculture, setting up of godowns, procurement of foodgrains, fertilizers, seeds, LPG/CNG/Petrol/Diesel distributorship, short-term & long-term credit, custom hiring centers, common service centers, Fair Price Shops (FPS), community irrigation, Business Correspondent activities, Common Service Centre, etc.

13-Dec-2022: Maintaining Classified Data on Cooperatives

Ministry of Cooperation has initiated process of developing a National Cooperative Database with proactive participation of various States/UTs, NCUI and National Federations and statutory bodies such as NABARD, NDDB, NFDB, etc. for having an authentic & updated data repository of cooperatives working in all sectors all over the country. The proposed Database shall facilitate all stakeholders in policy making & implementation to strengthen the cooperative movement in the country. In the first phase of development of National Cooperative Database, data collection of cooperatives of three sectors i.e. PACS, Dairy and Fisheries is being taken up.

Ministry of Cooperation has prepared model byelaws for Primary Agricultural Credit Societies (PACS) after extensive consultation with all the stakeholders including State Governments and Union Territories. These Model Byelaws will enable PACS to be established as a multipurpose vibrant economic centre at Village/ Panchayat level and take up more than 25 activities including dairy, fisheries, LPG/Petrol/Diesel dealership agency, banking correspondent, common service centres, etc. This will help the members of the primary credit societies.

7-Dec-2022: Online transaction in Co-operative Societies

A project for Computerization of 63,000 functional Primary Agricultural Credit Societies (PACS), in next three years, with a total financial outlay of ₹ 2,516 Crore has been approved by the Cabinet Committee on Economic Affairs vide its decision dated 29th June, 2022. This project entails bringing all the functional PACS onto an ERP (Enterprise Resource Planning) based common software, linking them with NABARD through State Cooperative Banks (StCBs) and District Central Cooperative Banks (DCCBs).

Computerization of PACS will provide various benefits such as increasing the efficiency of their operations, ensuring speedy disbursal of loans, lowering of transaction costs, reducing imbalances in payments, seamless accounting with DCCBs and StCBs and increasing transparency. It will also enhance trustworthiness in the working of PACS among farmers. Implementation of Common Accounting System (CAS) and Management Information System (MIS) would enable PACS to carry out their operations online and obtain refinance/ loans for their various activities from NABARD through DCCBs and StCBs.

20-Jul-2022: Bylaws for PACS

In order to make Primary Agricultural Credit Societies (PACS) multipurpose vibrant business entities, draft model bye-laws are being prepared in consultation with the State Governments, National Cooperative Federations and all other stakeholders. These Draft Model Bye-Laws contain various provisions for bringing professionalism, transparency and accountability in their operation. It is to mention that PACS registered and administered under the respective State Cooperative Laws.

The Government is also formulating a new national level policy for cooperatives and two-day National Conference on new Cooperation Policy was held on 12th and 13th April, 2022 with Cooperation Secretaries/ RCSs from all the States/UTs, wherein discussions were inter alia held on legal framework, identification of regulatory, policy & operational barriers; ease of doing business; reforms for strengthening governance; promoting new and social cooperatives; revitalizing defunct ones; making cooperatives vibrant economic entities; cooperation among cooperatives and increasing membership of cooperatives.

Also, a centrally sponsored project for Computerization of 63,000 PACS has been launched to further help them in their digitalization and end-to-end automation of their businesses. It will bring transparency and enhance trustworthiness in the working of PACS and will also help them become nodal service delivery point for Interest Subvention Scheme (ISS), PMFBY, Direct Benefit Transfer (DBT) for various services and provision of inputs like fertilizers, seeds etc. This pan India IT project and legal reforms through adoption of model bye-laws by PACS will create enabling environment for PACS to become vibrant multipurpose business entities.

19-Jul-2022: Model Bye-laws for PACS

In order to make Primary Agricultural Credit Societies (PACS) multipurpose vibrant business entities, draft model bye-laws are being prepared in consultation with the State Governments, National Cooperative Federations and all other stakeholders. These Draft Model Bye-Laws contain various provisions for bringing professionalism, transparency and accountability in their operation. It is to mention that PACS registered and administered under the respective State Cooperative Laws.

The Government is also formulating a new national level policy for cooperatives and two-day National Conference on new Cooperation Policy was held on 12th and 13th April, 2022 with Cooperation Secretaries/ RCSs from all the States/UTs, wherein discussions were inter alia held on legal framework, identification of regulatory, policy & operational barriers; ease of doing business; reforms for strengthening governance; promoting new and social cooperatives; revitalizing defunct ones; making cooperatives vibrant economic entities; cooperation among cooperatives and increasing membership of cooperatives.

Also, a centrally sponsored project for Computerization of 63,000 PACS has been launched to further help them in their digitalization and end-to-end automation of their businesses. It will bring transparency and enhance trustworthiness in the working of PACS and will also help them become nodal service delivery point for Interest Subvention Scheme (ISS), PMFBY, Direct Benefit Transfer (DBT) for various services and provision of inputs like fertilizers, seeds etc. This pan India IT project and legal reforms through adoption of model bye-laws by PACS will create enabling environment for PACS to become vibrant multipurpose business entities.

29-Jun-2022: Cabinet approves Computerization of Primary Agriculture Credit Societies (PACS)

The Cabinet Committee on Economic Affairs chaired by Prime Minister Shri Narendra Modi has approved Computerization of Primary Agricultural Credit Societies (PACS) with the objective of increasing efficiency of PACS, bringing transparency and accountability in their operations; facilitating PACS to diversify their business and undertake multiple activities/ services. This project proposes computerization of about 63,000 functional PACS over a period of 5 years with a total budget outlay of Rs. 2516 crore with Government of India share of Rs. 1528 crore.

The Primary Agricultural Cooperative credit societies (PACS) constitute the lowest tier of the three-tier Short-term cooperative credit (STCC) in the country comprising of approx.13 Cr. farmers as its members, which is crucial for the development of the rural economy. PACS account for 41 % (3.01 Cr. farmers) of the KCC loans given by all entities in the Country and 95 % of these KCC loans (2.95 Cr. farmers) through PACS are to the Small and Marginal farmers. The other two tiers viz. State Cooperative Banks (StCBs) and District Central Cooperative Banks (DCCBs) have already been automated by the NABARD and brought on Common Banking Software (CBS).

However, majority of PACS have so far been not computerized and still functioning manually resulting in inefficiency and trust deficit. In some of the states, stand-alone and partial computerization of PACS has been done. There is no uniformity in the software being used by them and they are not interconnected with the DCCBs and StCBs. Under the able guidance of Shri Amit Shah, Hon'ble Minister of Home and Cooperation, it has been proposed to computerize all the PACS throughout the Country and bring them on a common platform at National level and have a Common Accounting System (CAS) for their day to day business.

Computerization of PACS, besides serving the purpose of financial inclusion and strengthening service delivery to farmers especially Small & Marginal Farmers (SMFs) will also will become nodal service delivery point for various services and provision of inputs like fertilizers, seeds etc. The project will help in improving the outreach of the PACS as outlets for banking activities as well as non-Banking activities apart from improving digitalisation in rural areas. The DCCBs can then enroll themselves as one of the important options for taking up various government schemes (where credit and subsidy is involved) which can be implemented through PACS. It will ensure speedy disposal of loans, lower transition cost, faster audit and reduction in imbalances in payments and accounting with State. Cooperative Banks and District Central Cooperative Banks.

The project comprises of development of cloud based common software with cyber security and data storage, providing hardware support to the PACS, digitization of existing records including maintenance support and training. This software will be in vernacular language having flexibility of customisation as per the needs of the States. Project Management Units (PMUs) will be set up at Central and State levels. District Level Support will also be provided at cluster of about 200 PACS. In the case of states where computerization of PACS has been completed, Rs. 50,000/- per PACS will be reimbursed provided they agree to integrate with/adopt the common software, their hardware meets the required specifications, and the software was commissioned after 1st February, 2017.