The impact of scrapping of two-high value notes and the ceiling limit imposed on withdrawals has adversely affected the District Central Cooperative Banks (DCC) in Mandya, Ramanagaram, Bengaluru Urban and Bengaluru Rural districts, with milk producers being instructed to open accounts in nationalised banks for receiving payments.
Over 2.47 lakh dairy farmers from these districts, who supply milk through 3,227 milk producers’ cooperative societies (MPCS) to two Milk Manufacturers’ Unions, have not received payments since the demonetisation of Rs. 500 and Rs. 1,000 notes came into effect on November 9.
Of the 3,227 MPCS, around 50 per cent are all-women cooperative milk producers’ societies.
The Mandya Milk Manufacturers’ Union Ltd. (MANMUL) has 1.12 lakh registered dairy farmers, while the Bangalore Milk Union Ltd. (BAMUL) has 1.35 lakh milk suppliers in Ramanagaram, Bengaluru Rural and Bengaluru Urban districts.
The procurement of milk from both unions is around 24 lakh (around 8 lakh from MANMUL) litres a day.
Delay in payment
The non-availability of cash at DCC banks and weekly restrictions have severely affected the milk suppliers. The demonetisation has left them with no choice but to receive their payment once or twice in a month, R.K. Ramesh, chairman, BAMUL, told The Hindu.
The Unions disburse payment to MPCS accounts at DCC banks, through online transfers, and instruct the MPCS secretaries to pay the suppliers in cash once in a week. Nevertheless, the secretaries are unable to withdraw the required amount from the DCC banks following the weekly ceiling restrictions. Moreover, DCC banks have not installed ATM kiosks in rural areas.
New accounts
Following the cash crisis, the MPCS and milk suppliers have been asked to open accounts at nationalised banks, N.G. Prabhudev, manager, Lead Bank of Mandya (Vijaya Bank), told The Hindu.
Once the process of opening accounts at nationalised banks is completed, the MPCSs will transfer the payments from the MPCS accounts to the bank accounts of milk suppliers, a senior officer at the MANMUL said.
According to BAMUL officials, secretaries at MPCS and milk suppliers in Ramanagaram, Bengaluru Urban and Bengaluru Rural districts have also been asked to open accounts at nationalised banks.
