Role and Importance of District Central Co-operative Banks

The District Central Co-operative Bank occupies the pivotal middle place in the rural credit system, and its importance flows from that position. Without a strong DCCB, the tiny village society at the base would be cut off from the resources of the apex bank, and the apex bank would have no way of reaching the individual farmer. Its chief contributions are:

• Financing the primary societies of the district — It is the main source of funds for the village credit societies, supplying them with the short-term and medium-term money they in turn lend to farmers for cultivation and small improvements. This is the single most important thing it does for the rural economy.
• Acting as the balancing centre — By taking the surplus of societies that have spare funds and lending to societies that are short, it moves money within the district to where it is most needed, so that no society's idle money is wasted and no society's need goes unmet.
• Linking the base with the apex — It is the essential bridge between the primary societies and the State Co-operative Bank (and through it NABARD and the RBI), drawing refinance from above and channelling it to the village level; without this link the three-tier structure would break at the middle.
• Mobilising rural savings — By accepting deposits from societies, individuals and the public across the district, it draws out rural savings and turns them into a pool for productive lending, building the habit of thrift.
• Supervising and strengthening the societies — It inspects and guides its member societies, helps them keep proper accounts, recover overdues and run soundly, thereby strengthening the whole co-operative movement in the district.
• Providing cheap, timely credit and countering the moneylender — By supplying farmers (through the societies) with credit at reasonable rates and at the time it is needed, it frees the villager from the high-cost private moneylender.
• Promoting balanced rural and district development — By keeping the district's savings working within the district and financing farming, marketing, processing and allied activities, it supports the balanced development of the local rural economy.