What are Primary Agricultural Credit Societies (PACS)

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Union Cabinet recently approved the establishment of new Primary Agricultural Credit Society in 2 lakh panchayats in the next five years.

About the Primary Agricultural Credit Societies (PACS):

  • PACS are village-level cooperative credit societies that serve as the last link in a three-tier cooperative credit structure headed by the State Cooperative Banks (SCB) at the state level.
  • Credit from the SCBs is transferred to the district central cooperative banks (DCCBs) that operate at the district level. The DCCBs work with PACS, which deals directly with farmers.
  • Individual farmers are members of the PACS, and office-bearers are elected from within them. 
  • There are 1.02 lakh PACS in India (As per the RBI report of December 2022).
  • Functions:
    • To provide short and medium-term purpose loans to farmers for various agricultural purposes.
    • Borrowing adequate funds from central financial agencies to help its members on time.
    • Maintaining the supply of the hired light machinery for agricultural purposes.
    • To promote savings habits among its members.
    • To arrange for supplying agricultural inputs.
    • Provide marketing facilities to members  that could enhance the sale of their agricultural products in the market at reasonable prices.
  • Organizational Structure:
    • General Body: Exercise control overboard and management.
    • Management Committee: The general body elects them to perform the work prescribed by society’s rules, acts, and by-laws.
    • Chairman, Vice-Chairman, and Secretary: Appointed from amongst its members. They work for the benefit of the members by performing their roles and duties as assigned to them.
    • Office Staff: Performs day-to-day work.


Q1)  Who regulates  Co-operative Societies in India?

The incorporation, regulation and winding up of co-operative societies (other than those operating in more than one State) is a State subject and is governed by the State laws on co-operative societies . In the case of co-operatives with objects not confined to one State, their incorporation, regulation and winding up fall in the central domain and are governed by the Multi-State Co-operative Societies Act, 2002. As the vast majority of co-operative societies are operating only in one State, the State Government and the Registrar of Co-operative Societies appointed by the State are the main regulatory authorities for the cooperative societies

Source: Union Cabinet approves establishment of new Primary Agricultural Credit Society in 2 lakh panchayats