Module 9: Rural Financial Institutions - PACS, State Cooperative Bank & SCARDB

📖 Chapter 7 of 10 🧩 Module 10 of 18 ⏱️ ~2 min read 💡 1 MCQs

Topic Part 1 of 2

1. Primary Agricultural Credit Societies (PACS):

PACS form the grassroots tier of the short-term cooperative credit structure, directly providing crop loans, inputs, and marketing support to farmers.
Bihar has 8,463 PACS, accounting for 8.9 percent of all PACS in India.
However, their financial resource base is extremely weak: total deposits of all PACS in Bihar stood at just Rs. 175 crore, while total borrowings were Rs. 501 crore.
Operational challenges include low member participation, managerial deficiencies, and poor resource mobilization. There is an urgent need to redevelop PACS into multi-service centers.

2. State Cooperative Banks (Apex Tier):

Forms the apex of the cooperative credit pyramid, channeling refinance from NABARD to District Central Cooperative Banks and primary societies.
Asset Quality Improvement: The proportion of Non-Performing Assets (NPAs) dropped sharply from 10.3 percent in 2015-16 to 4.5 percent in 2016-17.

3. State Cooperative Agriculture & Rural Development Banks (SCARDB):

Provide long-term investment credit (tractors, tubewells, land development) by floating debentures with maturities up to 20 years, refinanced by NABARD.
Critical Financial Distress: Non-performing assets (NPAs) of SCARDB in Bihar stood at an alarming 98.1 percent of outstanding loans in 2014, virtually crippling long-term cooperative lending.

⭐ Key Points

PACS form the grassroots tier of the short-term cooperative credit structure, directly providing crop loans, inputs, and marketing support to farmers.
Bihar has 8,463 PACS, accounting for 8.9 percent of all PACS in India.
However, their financial resource base is extremely weak: total deposits of all PACS in Bihar stood at just Rs. 175 crore, while total borrowings were Rs. 501 crore.
Operational challenges include low member participation, managerial deficiencies, and poor resource mobilization. There is an urgent need to redevelop PACS into multi-service centers.

📌 One-line Q&A

PACS form the grassroots tier of the short-term cooperative credit — structure, directly providing crop loans, inputs, and marketing support to farmers.
Bihar has ______ PACS, accounting for 8.9 percent of all PACS in India. — 8,463
However, their financial resource base is extremely weak: total deposits of all PACS in Bihar stood at just Rs. 175 crore, while total borrowings were Rs. 501 crore.
Operational challenges include low member participation, managerial deficiencies, and poor resource — mobilization. There is an urgent need to redevelop PACS into multi-service centers.

Questions 1 MCQs

Answer this question, then use Next.

What percentage of total Primary Agricultural Credit Societies (PACS) in India are located in Bihar?

Bihar has 8,463 PACS, which account for 8.9 percent of all PACS across India.

Question 1 of 1

One-liners

Write your answer, then submit to see the correct answer.

PACS form the grassroots tier of the short-term cooperative credit ______

structure, directly providing crop loans, inputs, and marketing support to farmers.

Bihar has ______ PACS, accounting for 8.9 percent of all PACS in India.

8,463

However, their financial resource base is extremely weak: total deposits of all PACS in Bihar stood at just Rs. 175 crore, while total borrowings were Rs. 501 crore.

total deposits of all PACS in Bihar stood at just Rs. 175 crore, while total borrowings were Rs. 501 crore.

Operational challenges include low member participation, managerial deficiencies, and poor resource ______

mobilization. There is an urgent need to redevelop PACS into multi-service centers.