The Circle is complete – NACH for Credit and RuPay for Debit


In India, farmers are mainly dependent on registered arthiyas/commission agents at Procurement Centres for sale of their produce. The arthiyas/commission agents in turn consolidate the stocks, sell, retain commission and then pass on the payments to the farmers.

Central and state agencies procuring wheat and paddy, issue  cheques to firms operated by arhtiyas for onward payment to farmers.

There was often a time-gap between the procurement of the agricultural produce and the final payment.

Over the years, there have been many programs to shorten the time-frame between procurement and the final payment.

However, due to various reasons there was not much success. After experimenting with various models, Pungrain (Punjab Grains Procurement Corporation Ltd.), has adopted a hybrid model, wherein the Arthiyas as well as farmers are happy.

The back-bone of the model is Kissan Aarthia Information & Remittance Online Network.

The implementation partner was globalepurchase and the NPCI’s NACH and RuPay technologies were the ePayment channels.

The Arthiyas and the farmers received credit through NACH-Credit channel and the amounts could be withdrawn through the RuPay Card.

This has been successfully implemented all over Punjab and may be extended to other crops as well and some facility of this type should also be developed to deliver subsidies on kerosene, diesel, fertilizers etc.

The benefits of this system to the procurement agencies and arthia would be as follows :-

  • Running & maintenance is paid by the participating banks.
  • There are no data entry errors in the system which is major hurdle in the process of computerization as Punjabi names can be spelled in many ways in English.
  • There would be no delay in the payment to the arthia and department would be in a position to fix responsibility of the person causing delay if at all.
  • The clerical work being done by field level staff would be considerably reduced because the necessary reports for cross checking would be available electronically on line.


  • The level of accuracy in payment process would improve since all the transactions would be done through computers.
  • There would be no idle float in current accounts at field offices as the payment would be drawn from the single account and would be credited to arthia accounts. This will lead to saving of considerable amount of interest on cash credit limit.
  • This system provides end to end electric process with least human intervention and no manual intervention is involved for transfer of money from agency account to Arthia account.
  • This system is provided free of cost to all the stake holders, no charges are taken from the arthia and agencies.
  • Not much investment is required to implement the system as all the operation are done by banks/utility and only 2 computers ,one printer and internet connection are required for this system.
  • Complete feedback of payments made is given by the bank through portal i.e detailed reconciliation report of the bank is available bank wise, account wise, arthia wise, crop wise etc saving time and effort in a considerable way, which results in early finalization of accounts.


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