Madhya Pradesh government is planning to present the Madhya Pradesh Cooperative Society (Amendment) ordinance 2021 in the upcoming Budget Session which would start from 22 February.
The amendment will bring about major changes in the operation of cooperative banks of the state and in loan recovery from farmers, according to media reports. These provisions will come into effect from 1st April, say sources.
Cooperative experts said that when the amendments are passed in the Assembly, the state government will not have to take permission of the RBI to open branches of cooperative banks. The officials of the cooperative department said the Central Government has amended the Banking Regulation Act, based on which the Cooperative Act is to be amended in the state.
“Following the amendment banks will not require prior permission of RBI to open branches and the state government will independently take decisions in terms of consumer convenience and banking business. A new system of auditors will be created to audit cooperatives. There will be no separate panel”, the officials said.
Earlier in the wake of rumours doing the rounds that DCCBs banks are being closed, the state cooperative minister Arvind Singh Bhadoria said there is no plan to close any of the cooperative banks in near future. We will remove deficiencies from these banks.
Official sources close to National Bank for Agriculture and Rural Development (NABARD) said the intention is to reduce the expense in the operation of cooperative banks. After the computerization of PACCs, all the societies will be directly connected to the State Cooperative Apex Bank.
The farmers are getting short term agricultural loans for Rabi and Kharif crops in the state through Primary Agricultural Credit Cooperative Societies (PACS). There are 4250 societies with more than 53 lakh farmer members. The 38-district cooperative central banks which are having 839 branches are providing credit facility to the co-op societies and also carry out banking business.
It bears recall that last year Madhya Pradesh governor Anandiben Patel promulgated the Madhya Pradesh Co-operative Societies (Amendment) Ordinance, 2020 in order to allow the elected Members of Parliament and Members of Legislative Assembly to become Chairmen and Vice-Chairmen of cooperatives.