Dairies have two months to go completely cashless

Demonetisation last year had resulted in delayed payment to farmers as dairies scrambled to get their farmers in the banking network. Private dairies also operate on a similar model, but instead of primary cooperative societies, they deal with bulk milk chillers (BMC) operators and agents who, in turn, pay the farmers.

Written by Partha Sarathi Biswas | Pune | Published:June 17, 2017 4:23 am
Primary cooperative societies work at the village level and collect milk for taluka and district level dairies. These dairies, in turn, work for the state brand which in Maharashtra is Mahananda.

In another push to dairy industry to go cashless, the state government has directed primary cooperative milk producers societies to ensure 100 per cent payment to their members via bank transfer. Failure of the societies to adhere to the same will attract action by the state government.

Primary cooperative societies work at the village level and collect milk for taluka and district level dairies. These dairies, in turn, work for the state brand which in Maharashtra is Mahananda. Farmers are paid by the village level societies at a regular basis who, in turn, are paid by the district level cooperatives. While dairies normally take the bank route to pay the primary societies, the farmers are mostly paid in cash by the societies. Maharashtra has 12,299 such societies functional now.

Demonetisation last year had resulted in delayed payment to farmers as dairies scrambled to get their farmers in the banking network. Private dairies also operate on a similar model, but instead of primary cooperative societies, they deal with bulk milk chillers (BMC) operators and agents who, in turn, pay the farmers. The payment to the BMC operators are mostly done through banking mode, while farmers are paid in cash. With dairy being a cash-intensive business, farmers prefer payment in cash to meet their immediate demands like that of fodder, feed etc.

The government resolution (GR) issued by the department of animal husbandry, fisheries and dairy development has given the primary societies two months time to ensure 100 per cent cashless payment to their members. Failure to do so, the GR said, will attract action from government.

Cooperative dairies have given a cautious welcome to the move. Mohan Yadav, the spokesperson of the Kolhapur District Cooperative Milk Producers Union – which sells dairy products under the brand Gokul – said almost 90 per cent of their 5.5 lakh farmers are now being paid through the bank mode. “We will have to give direction to our 5,000 societies to ensure 100 per cent bank transfer,” he said. Dr Vivek Ksheersagar, managing director of the Pune district cooperative milk producers union, the owner of brand Katraj, said while the dairy pays the societies through bank mode, around 50 per cent farmers still get payment in cash.

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