Livestock rearing is central to the livelihoods and survival of small marginal farmers and landless agricultural laborers across the country. As livestock related activities help to maintain a daily inflow of income for these households, livestock economy is a source of self-insurance for farmers. It provides a diversified source of income and mitigates the uncertainties of seasonal income from their traditional sources like agriculture.
In line with the mission to serve this target group of remote rural customers in Thanjavur district, Pudhuaaru KGFS (PKGFS) launched its ‘Livestock Loan’ product to fund customers who are interested in pursuing dairying activity.
Some of the salient features of this product are:
- Single loan to buy two cattle and two staged disbursements aligned with the lactation cycle to ensure continuous income from dairying activity to the customer.
- Repayment management– Seamless repayment management enables customers to supply milk to a designated milk vendor and the milk vendor remits amount earned by the respective customer to PKGFS. The installment amount will be deducted and the excess amount would be invested in respective customer’s MMMF folio, which can be redeemed as per customer needs.
- Anywhere disbursement – Based on the customer’s convenience, loan can be disbursed either at the branch or in the field (cattle seller’s place) after the necessary due diligence.
First Livestock loan disbursement. From left: Rohit Mukkawar (IFMR Rural Finance product and process team), Manikandan (Wealth Manger), Ravi (Asst Regional Manager – PKGFS ) handing over the loan amount to customer Poongothai & her husband Rajenthiran
The first loan was disbursed at Veeramangudi branch on 25th May, 2010, after the mandatory health checkup and valuation by Dr. Gangadharan, DNE’s veterinarian on the field. The second loan was disbursed shortly afterwards to customer Malarkodi after completing the necessary ground procedures.
Rohit Mukkawar says “The product & process were designed after taking inputs from various sources. Interested & eligible customers are being identified by our wealth managers. ARMs along with the veterinarian will conduct the mandatory health check up & valuation process before disbursing the loan. We look forward for a smooth piloting phase and hope to see the product reach the scale-up stage at the earliest”.
Bharathi Kannamma of IFMR Rural Finance (presently known as Dvara KGFS) contributed to this post.