Farmers’ cooperative floats unique loan waiver scheme

In a unique loan waiver scheme introduced for farmers, Sirsi-based Totagars’ Cooperative Sale Society Ltd. (TSS) has established ‘runa mukta nidhi’, a reserve fund to waive the loans availed of by its farmer-members.

Initially, loans up to ₹5 lakh will be waived in case the loanee farmer dies. The scheme is not applicable in case the farmer commits suicide. The annual general body meeting of the society, held recently, approved the scheme, general manager of the society Raveesh A. Hegde, who is also one of is directors, told The Hindu.

He said the society would collect ₹500 per ₹50,000 minimum loan amount as the contribution of the farmer towards the reserve fund. The society will contribute an equal amount to the fund. The upper limit of the contribution amount to be deducted from a farmer has been fixed at ₹5,000. It means that if a member avails of ₹6 lakh and more as loan, the contribution which will be deducted towards the fund will be only ₹5,000 and not more than that.

“We are planning to extend the loan waiver limit from ₹5 lakh to ₹10 lakh after some months,” he said. “Such a loan waiver scheme is being implemented in a cooperative society in Karnataka for the first time,” Mr. Hegde said. The 97-year-old society in Uttara Kannada has 30,000 farmers as members.

In another major initiative, the society will procure tender and raw arecanut from farmers from the doorstep and process, dry, grade them, and return (to farmers). In case the farmers want to deposit or store their produce in the warehouse of the society, they can do so.

The initiative will help many farmers who are facing acute shortage of labourers required for the post-harvest processing, which is crucial for maintaining the quality of the produce, Mr. Hegde said.

Henceforth, the society will extend 100% medical expenses’ reimbursement scheme to all farmer-members’ families. So far, it was restricted to only farmer-members and farm labourers, he said.


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