To help in its modernisation exercise to serve twin purposes
Mafcocs' membersare not agriculture finance cooperatives though they primarily lend to the agricultural community.
The advancesare somewhat in the nature of personal loans, which may go to into purchase of farming implements and the like.
Mumbai, July 24
The Maharashtra State Federation of Co-operative Credit Societies (Mafcocs) has asked the State Government to facilitate finance from the National Bank for Agriculture and Rural Development to the tune of 20 per cent of the Federation's advances.
"Since April/May this year, we have been requested to issue agricultural finance by the State Government; we feel that finance from Nabard would be in order," said Mr Lalit Gandhi, President, Mafcocs. "We have met with the Chief Minister of Maharashtra and asked him to help us to arrange finances, and to persuade the relevant authorities to help us get Nabard funds," he said.
Though they primarily lend to the agricultural community, Mafcocs' members are not agriculture finance cooperatives; the advances being somewhat in the nature of personal loans which may go to into purchase of farming implements and the like, he said. The Federation is currently on a modernisation exercise that will serve two purposes. One is to enable the federation with its vast rural network, to function as a delivery channel for micro-finance products that private banks are planning to sell.
"We have been approached by nearly every well-known private bank in the country including ICICI Bank, HDFC Bank, and we have 42,000 points of presence in Maharashtra which work for a very good distributionnetwork for these banks which have to start from scratch if they want to do micro-financing directly; and the government is keen that all banks extend their microfinance services... " said Mr Gandhi.
The other purpose of modernisation is for Mafcocs members to match up with these very same institutions, which will now be competition for its own member societies, he said.
Mafcocs consists of 28,000 member societies of which 21,000 are active. Around 2.18 crore people are Mafcocs societies' cooperative members. Total advances issued by these societies stand at Rs 27,000 crore, said Mr Gandhi.
Higher interest rates
Funds are raised almost entirely through deposits, which currently stand at Rs 32,000 crore. To attract deposits the societies used to offer higher rates of interest than the regular mainstream banks.