Question 59

Let's analyze the statements concerning credit delivery to the agriculture sector:

• 1. In terms of short-term credit delivery to the agriculture sector, District Central Cooperative Banks (DCCBs) deliver more credit in comparison to Scheduled Commercial Banks and Regional Rural Banks. This statement is incorrect. While DCCBs play a significant role, Scheduled Commercial Banks (SCBs) are generally the largest providers of short-term agricultural credit in India, followed by Regional Rural Banks (RRBs) and then cooperative banks (including DCCBs and State Cooperative Banks). SCBs have a much wider network and larger lending capacity.

• 2. One of the most important functions of DCCBs is to provide funds to the Primary Agricultural Credit Societies. This statement is correct. District Central Cooperative Banks (DCCBs) form the middle tier of the short-term cooperative credit structure. They mobilize funds from the State Cooperative Banks (at the apex) and provide finance to the Primary Agricultural Credit Societies (PACS) at the grassroots level. PACS, in turn, directly disburse short-term and medium-term loans to individual farmers for agricultural operations.

Therefore, only statement 2 is correct.