November 23, 2016
Chennai: Asserting that the demonetisation move has brought the operations of the cooperative institutions to a virtual standstill in the state, MPs of the AIADMK, the third largest party in the Lok Sabha, urged Union Finance Minister Arun Jaitley today to allot Rs. 3,000 crore to the Cooperatives in Tamil Nadu to meet immediate crop loan disbursement needs.
They also requested that District Central Cooperative Banks (DCCBs) should be allowed to accept deposits in the KYC compliant accounts on par with scheduled commercial banks, as the restriction was discriminatory and would adversely affect the financial viability of cooperative institutions in the long run.
In a memorandum submitted to the minister, they said that like any other commercial bank DCCBs also run on core banking solutions and the transactions were subject to verification by the regulator. They urged the Central government to permit DCCBs to disburse to Primary Agricultural Cooperative Credit Societies (PACCS) without restriction of Rs. 24,000 per week, giving a special status to support the agricultural operations of farmers and rural clientele with immediate effect.
“PACCS may be allowed to accept repayment of loans by cash (including Rs. 500 and Rs. 1,000 notes of the old series) subject to safeguards prescribed by the RBI, Union and State governments,” the memorandum said.
They also pointed out that the state government has ordered that inputs for agricultural operations such as fertilizers, seeds and the like should be supplied to farmers by PACCs without insisting on cash payment and the same would be adjusted against their crop loan.