A study on role of primary agricultural credit societies (PACS) in financial assistance to rural people of India
Cooperative banks are one of the major banking agencies of our country and are playing very important role in the rural economy since long before independence. These financial institutions work on the principle of cooperation, self-help and mutual help. Primary Agricultural Credit Societies (PACS), as the basic unit of cooperative banks at village level, provide small and medium-term loans to small and marginal farmers and rural artisans for agricultural, non-agricultural and other purposes. About 96000 PACS with around 13.20 crore members are operating in India at present. The main objective of the present paper is to study the status of agricultural loan disbursed by the PACS of different states and UTs of our country and share of it on total loan disbursement during the study period of 2012-13 to 2108-19. The study reveals that the share of agricultural loan on total loan disbursed by PACS is not at satisfactory level. It is only 50% of the total loan disbursed at the end of the study period and has been increased only by 4% during the study period. The share of agricultural loan is below 70% of total loan disbursed in 12 states and UTs including some states where PACS are playing dominating role in terms of number, membership and amount of total loan disbursement. The study concludes that the issue of low share of agricultural loan to total loan disbursement should be considered seriously. The PACS of states where share of agricultural loan and coverage of village is low, should take proper measures to improve the status for overall improvement of the rural as well as national economy.