Support to Primary Agriculture Co-operative Societies (PACS) for developing them as Multi Service Centers (MSCs)
Salient features of the scheme
Establishment of agro-storage centre, agro-processing centre, agri-information centre, agri-transportation & marketing facilities, consumer stores and other support activities. PACS functioning as PO for on-lending to select members for farm/off-farm/ service sector activities besides crop loan (ST-SAO), are also eligible.
NABARD assistance is available either directly to PACS or through State/ District Central Co-operative banks.
- Primary Agriculture co-operative Society (PACS) - It should be in profit for the last three years with no accumulated losses. The PACS should be under category ‘A’ or ‘B’ of audit classification.
- District Central Co-operative Bank (DCCB) – Bank in category ‘A’, ‘B’ or ‘C’ audit classification, are eligible to avail financial assistance for on-lending to PACS.
- State Co-operative Bank (StCB) - Financial support will be made available as per the eligibility criteria of General Refinance Agreement.
Mode of Finance
The financial support is available to PACS under project mode which includes, credit support - term loan and composite loan; need based Grant assistance for accompanying measures.
A minimum 10% of the project cost is considered as borrower’s contribution.
Rate of Interest
The present rate of interest charged by NABARD to PACS on its loan is minimum 10% p.a. Penal interest of 2% p.a. will be charged on the delayed payment of principal and interest. Repayment will be maximum 9 years including grace period of 2 years.
- PACS: Mortgage and/ or hypothecation of assets created.
- DCCB & StCB: The assets created out of loan will be the primary security held by the concerned bank.
Collateral Security: PACS - 100% of loan amount as collateral for category ‘A’ &’B’ and 125% for category ‘C” PACS. For CCB - Collateral security to the extent of 100% of loan amount is taken from CCB in category ‘A’ or ’B’ and 125% for “C” audit classification. SCB - The security requirements will be governed by the eligibility criteria under General Refinance Agreement.
Progress so far
The cumulative sanctions of financial assistance to the Producer organizations amounted to Rs. 368.52 crore and disbursements to the tune of Rs.176.058 crore as on 31 March 2015, benefiting a total of 156 POs in the country. Similarly, 2211 PACS have been assisted under NABARD scheme with cumulative sanctions of financial assistance to the tune of Rs. 596.095 crore and Rs. 314.086 crore has been disbursed up to the same period.