What are Primary Agricultural Credit Societies?

About Primary Agricultural Credit Societies:

• These are village-level cooperative credit societies that serve as the last link in a three-tier cooperative credit structure. 
• These are headed by the State Cooperative Banks (SCB) at the state level.
• Credit from the SCBs is transferred to the district central cooperative banks, or DCCBs, that operate at the district level. 
• These district central cooperative banks work with PACS, which deals directly with farmers.
• Individual farmers are members of the PACS, and office-bearers are elected from within them. A village can have multiple PACS.
• PACS are involved in short-term lending — or what is known as crop loans. 
• At the start of the cropping cycle, farmers avail credit to finance their requirement of seeds, fertilisers etc. 
• Banks extend this credit at 7 per cent interest, of which 3 per cent is subsidised by the Centre, and 2 per cent by the state government. Effectively, farmers avail the crop loans at 2 per cent interest only.

Q1) What are the cooperative societies?

A cooperative society is a free and unconstrained organization for such individuals, who can utilize its services and agrees to accept the responsibilities of membership without any gender, social, ethnic, political or religious discrimination.

Source: What are Primary Agricultural Credit Societies? 

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