Urban cooperatives are a huge opportunity for the 438 urban cooperative banks in Maharashtra. Indicating strong hold in the sector, Vikas Rasal, Divisional Joint Registrar of Cooperative Societies (Mumbai Division), Government of Maharashtra, in conversation with Sneha Mejari and Jessy Iype of Elets News Network (ENN) throws light on how his organisation is helping to grow the role of urban cooperatives in the State
What has been the role of the cooperatives so far?
The cooperative movement in Maharashtra has a long history. It has 2.20 lakh cooperative institutions under 54 categories and about six-and-a-half lakh population is associated with it. These cooperatives include sugar cooperative mills, housing societies, and labour federations and societies. Almost 50 percent population is benefitting from the cooperative movement.
How does the cooperative structure work and how does the fund flow in this sector?
There are financial institutions, like the Maharashtra State Cooperative Bank and district central cooperative banks, and at the grassroots level there are primary agriculture credit societies (PACS). There are about 21,000 PACS in the State. The crop loans for Rabi and Kharif are given to the farmers through the central cooperatives banks. NABARD gives it to the Maharashtra Cooperative Bank through tax, which is distributed to the farmers. There is a commercial banks’ state-level committee of bankers, in which the policy is decided as to how much assistance should be offered to the farmers every year. Based on terms of crop loans, 50 percent finance is routed through the cooperative sector and 50 percent through commercial banks.
The State had distributed about Rs. 5,000 crore last year, out of which most funds were rolled out by the commercial banks. About 1.36 crore farmers are registered, out of which about 76 lakh are given the benefit of crop loans. We intend to reach every farmer to offer loans. The new government and the Cooperative Department will work through this and see that most of the farmers gain through these loans. Every branch of the bank will be given a target to cover all farmers in their vicinity. This is one of the important activities we have planned. Farmers sometimes go to private lenders, too, for credit. The Maharashtra Government has announced that Rs. 171 crore private loan taken by the farmers will be reviewed and as per the government resolution, it shall be settled. Crop loans up to one lakh rupees are made available at reasonable rates of interest. The loan, if repaid within time, they will be given three percent interest rebate.
Tell us about the role of urban cooperatives in Maharashtra?
The urban cooperatives are a huge opportunity and there are 438 urban cooperative banks in Maharasthra, and 15,000 cooperative credit societies. The government has 65 percent urban movement in the State, which indicates a strong hold. These banks and societies are non-agriculture financial institutions. This sector covers urban area and towns, where the credit requirement of the urban population is estimated and disbursed, accordingly. The system is easily accessible to the people as it has a local connect. Credit and recovery also becomes easy there.
What are the advantages of a sugar cooperative in Maharashtra? How can it benefit the industry?
Sugar cooperative is one of the strongest and most important segments in Maharashtra with high, socio-economic impacts. Owing to these cooperatives, the sugar movement got the strength here. There are 168 sugar factories in the State, and every year Rs. 5.11 lakh metric tonnes of sugar is produced with an annual turnover of Rs. 35,000 crore.
It is a major revenue earner of the State, as 55 percent of sugar is produced in Maharashtra. There are nine lakh harvesters and 1.5 lakh people are working in the sugar factories. Besides, there are lots of ancillaries in the sugar industry, like distillery, coal generation, particle ores, by-products, etc., that generate more employment.