Amul told to ensure bank accounts for all its milk producers by 30 December

The government has directed the Gujarat Cooperative Milk Marketing Federation (GCMMF), which owns the Amul brand of milk and milk products, to ensure all member milk producers have a bank account by  by 30 December 2016.

This is being done to address the effects of cash shortages following the government's 8 November demonetisation decision, agriculture minister Radha Mohan Singh informed Parliament on Friday.

Non-availability of cash at co-operative banks has hampered payments to milk producers / farmers by dairy co-operative against the milk supplied by them. In this regard, the government has specifically directed GCMMF / Amul, which is the nation's largest milk cooperative, to ensure opening of 100 per cent milk producer accounts by 30 December 2016.

Similarly, other co-operatives have been directed to ensure the opening of 100 per cent accounts of milk producers / farmers by 30 January 2017.

Specific instructions have been issued to all the agencies such as National Dairy Development Board, Mother Dairy, Delhi Milk Scheme and all state dairy co-operative federations for ensuring direct payment to milk producer's bank account at the earliest.

However, this has to be backed by better penetration of nationalised banks in rural areas and adequate financial support for co-operative banks in rural areas, with appropriate safeguards, the minister said.

Singh said the government has been reviewing the issue of prompt payment to farmers and directing officials and taking appropriate action to alleviate the problems. Regular meetings with Mother Dairy, Gujarat Cooperative Milk Marketing Fed (GCMMF) / Amul, Delhi Milk Scheme and other co-operatives have also been convened at regular intervals to streamline the payment system to milk producers and even sale of milk to consumers through cashless transactions primarily, he added.

There are about 1.70 lakh dairy co-operative societies (DCS) at village level with 218 affiliated milk union and 16 million milk producers, handling about 85 million litres of milk, valued at Rs120 crore, across the country.

For weekly and 10-day payment cycles substantive amounts have to be disbursed to lakhs of milk producers spread over varied geographical areas.

Milk is also procured from private dairies.

Opening of bank accounts by all unbanked milk producers will help limit the use of cash and make it more digital.

Eventually, transparency saving habits, financial enclosure, etc, would benefit milk producers in multiple ways, the minister said.