There are 42000 dairy farmers in Rajasthan under HDFC Bank’s ‘Milk-to-Money’ scheme where HDFC Bank works closely with dairy co-operative societies and farmer producer organizations to provide then with banking access through varied products and services.
As per Government of India’s financial inclusion norms and identified priority sector lending guidelines, HDFC Bank reaches out to the unbanked dairy farmers in Rajasthan, to get them in their banking fold. One of the many success stories of such inclusive banking is village Nindola near Chomu in Jaipur. HDFC Bank has worked in the village to support the dairy farmers with banking at doorstep concept through business correspondents, relationship managers, micro ATMs and other digitally enabled services, making banking convenient for its rural clients. The Bank took 240 members of Nindola Mahila Dugdh Utpadak Samiti under the ‘milk-to-money’ programme, who were hitherto dependent on money lenders as none of them could produce collaterals for bank loans. But now, this exemplary 100% women owned cooperative society of 200 women, have their accounts with the bank now and 25 of them have availed loans too. In addition to Banking Services, HDFC Bank also holds regular financial literacy trainings to keep up the awareness of their clients.
As per Mr. Michael Andrade (Head Agri- Business at HDFC Bank), dairy is considered as secondary income and HDFC Bank is committed to help increase this secondary income for their customers. An example of HDFC Banks’s efforts towards this is that they organized Milk supply chains via micro ATMs. HDFC Bank’s financial inclusion strategy is to focus on smallholder dairy farmers (with land holding <1 hectare), who are a big audience. Additionally, there is also the Kisan Credit Card scheme by the Bank that covers farmers having above 8 hectares of land holding.
Mr. Andrade also said “over two and a half lakh dairy farmers make about Rs. 200 a day with the help of this intervention.” In Rajasthan, average produce of cattle is 3-4 liters of milk vis-à-vis about 6 liters of milk being national average therefore there is huge potential to increase the same. These fairy farmers can be attached to larger dairies like NDDB, RCDF and Nestle where they can significantly increase their revenue flow from the dairy business. There is a great scope for better quality milk and its products, considering that dairy farming was revolutionizing in India, both in terms of livelihood and national health. Hence, HDFC Bank is trying to improve milk’s traceability and in turn, marketability.
A woman dairy farmer stated that with the loan she availed through the bank, she was able to earn Rs10,000 out of which Rs.4000-5000 were her expenses (including the EMI of the loan) and an equal amount her saving. She attributes this to the formal banking scope where HDFC Bank has not only rough her into the fold of baking but also meaningfully improved her livelihood.
Another insight shared by a woman dairy farmer was that now she was able to deposit and withdraw cash herself since it is very convenient since it coincides with the time of milk collection. HDFC Bank has taken steps to understand the needs of its rural customers and device solutions that are not only popular and convenient but serve the national interest of getting maximum people the benefit of access to financial services (i.e. banking).
HDFC Bank’s focused approach to serve key small and medium traditional businesses of India such as the weaving community, agriculture and dairy farmers and likewise, will go a long way to contribute towards a financially viable citizens.
- Blog by - Manisha Jani & Indrani Sharma