Urges CM for effective cooperative credit structure
Minister Cooperation and Excise Damodar Rout has urged Chief Minister Naveen Patnaik to allow merger of the defunct Odisha State Cooperative Agricultural and Rural Development (OSCARD) Bank with the profit making, Odisha State Cooperative Bank (OSCB) in the interest of better service delivery to the farmers in the State through cooperative credit structure.
Rout in a detailed proposal has requested the Chief Minister that the long Term Cooperative Credit Structure comprising OSCARD Bank at State-level and CARD Banks at district level and the Short Term Cooperative Structure comprising OSCB and District Central Cooperative Bank (DCCB) needs to be merged to have a strong and vibrant united cooperative credit structure in the State.
The Minister said the OSCARD Bank and CARD Banks are defunct due to suspension of NABARD’s refinance facilities on account of loans, mounting NPAs and huge accumulated losses.
NABARD refinance suspension came in 2005-06 and since then CARD Banks, which are mandated to provide long term loans to the farmers for minor irrigation, plantation, horticulture, floriculture and farm mechanization has stooped funding such activities. As of now the total cumulative loss of OSCARD and CARD Banks stands over `280 crore. Now the employees and officers of the CARD Banks are not getting salary since years, while OSCARD Bank is eating away whatever capital it has to meet the cost of establishment.
On the first place the OSCARD Bank and CARD Banks needs to be integrated with capital restructuring by writing off their outstanding Government loan dues of `176 crore and the United OSCARD Bank needs to be merged with OSCB, suggested the Minister.
Dr Rout said that long Term Cooperative Credit Structure (lTCCS) still has its relevance in the cooperative credit dispensation system as CARD Banks are the institutions, which have the experience and expertise to bridge the critical gap in administering long term credit for investment in agriculture which, at present, is not up to the desired level in the State. In order to have proper utilization of the experience, expertise and outreach of the lTCCS, it has been proposed to have financial and organizational restructuring of the lTCCS by considering waiver of `176 crore loan, said Dr Rout.
After the merger, a financially stronger OSCB will be better suited to cater to the credit and banking needs of the farmers in the State, feels Minister.