Tag: IFSC code

A combination of two factors, the Centre’s decision to disburse crop insurance claims under direct benefit transfer (DBT) mode and delay in Kerala Bank getting its own IFSC code, are delaying the delivery of insurance claims of about 20,000 farmers across the state.

About Rs 21 crore to be disbursed to farmers as insurance claims for 2019-20 was returned by the insurance company as the farmers were unable to submit their account numbers and matching IFSC codes. Claims of Rs 70 crore are pending for 2020-21.

The farmers were getting compensation for crop loss due to adverse weather or other factors under Pradhan Mantri Fasal Bima Yojna (PMFBY). Most farmers (60-80%) have their accounts in primary agriculture cooperative societies (PACS). Earlier, the farmers were made to open mirror accounts in district cooperative banks (DCBs), and agriculture insurance company (AIC) of India was allocating the lumpsum amount of the total claims from a district to the DCB there. The DCB would then transfer the claim amount to the farmers through the mirror accounts. The DCBs were then giving utilisation certificates to AIC .

However, with Centre’s decision to enforce DBT, indirect transfer of insurance claim amounts became impossible. While trying to upload the claims in the DBT portal, the farmers submitted their account number in PACS and the district cooperative bank’s IFSC code. However, their claims bounced as these two data did not match. The compensation to farmers has not been disbursed for the last two years, said K K Kochumuhammed, president of Kole Karshaka Sangam.

Besides, Kerala Bank, formed by merging 13 DCBs, was yet to get a common IFSC code. “Once our software integration is over we will get a common IFSC code. We have requested AIC to retain the earlier practice till then, and clear the pending claims,” said Anita Abraham, DGM, Kerala Bank.

“We had a video conference on Thursday with Union agriculture ministry officials, and requested them to defer DBT implementation till the amalgamation process of DBCs and Kerala Bank are completed, and they have responded positively,” said George Alexander, additional director of agricultural department.