DCBs enrolling individuals

On the directive of the RBI and at the insistence of Nabard, the District Cooperative Banks (DCBs) in the state have started enrolling individuals as members.

Published: 07th October 2013 10:26 AM  |   Last Updated: 07th October 2013 10:26 AM   |  A+A-

On the directive of the RBI and at the insistence of Nabard, the District Cooperative Banks (DCBs) in the state have started enrolling individuals as members.

So far, DCBs had been admitting only affiliated societies like Primary Agriculture Credit Societies (PACS) as members. Nabard had earlier issued a circular asking the PACS to entrust their assets and liabilities with the DCBs and function as DCB agencies.

However, following stiff resistance from the PACS and political parties, the state government could impress upon Nabard to withdraw the circular. But it had insisted on the DCBs to enrol individuals as members as it could directly provide assistance to farmers.

As per the directive, all the DCBs were required to amend the bylaws by September 30. Speaking to Express, Mathew Kulathunkal, president, District Cooperative Bank, Pathanamthitta, said they had already amended the bylaw and started enrolling individuals as members. He said the Registrar of Cooperatives also had approved the amendments of bylaws.  “There is a directive that when a loan is sanctioned 2 per cent of the loan amount should be collected as share capital. And there is also a directive to induct a representative of the depositors on the Board of Directors,” he said.

Meanwhile, cooperative auditors have raised apprehensions about the speed audit programme which had concluded on September 30. As per the Cooperative Amendment Act passed in February, all the audit arrears had to be completed before September 30.

To meet the requirement, the government had launched the speed audit programme by engaging the cooperative auditors asking them to complete the arrears in the stipulated period.

It has been pointed out that as one auditor had to complete auditing of up to five PACS a month, the entire process of auditing had become a ritual.

As it was also an administrative audit, the cooperative auditors apprehend that they would be taken to task in case of unearthing any discrepancies in future.

They have apprehensions that as the auditing has been made upto-date now there will be work only in the next fiscal year.

They point out that apex cooperatives like Milma had already stated that they do not require the service of all those auditors made available for auditing.

With the DCBs enrolling members and granting agricultural credit directly, the auditors are apprehensive about the very existence of PACS in future.

Sanal Kumar, Director, Cooperative Audit, said such apprehensions had no ground. As long as administrative audit is there, auditors will have no reason to worry, he said. He admitted that as rules have not yet been prepared following passing of the Kerala Cooperative Amendment Act 2013, there was lack of clarity. He said the amendment Act would bring in more freedom to the members.

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