In a strategic policy push aimed at redefining the contours of rural finance, NABARD's Deputy Managing Director, Ajay Kumar Sood, called on Indian banks to pivot from conventional production-centric lending toward more holistic, market-aligned approaches such as value chain financing and aggregation. During a high-level interaction with key stakeholders, including officials from commercial, cooperative, and regional rural banks, Sood emphasized the importance of integrated rural credit delivery systems, supported by digital infrastructure and ecosystem-wide reforms. The visit also included the inauguration of sustainable farming initiatives and highlighted NABARD’s commitment to strengthening grassroots institutions like PACS and LAMPS.
Shifting the Paradigm of Rural Lending
At the heart of Ajay Kumar Sood’s message to bankers was a compelling call to action: evolve beyond legacy models of production-based credit and adopt financing strategies that support the entire agricultural value chain. By anchoring credit to market linkages, aggregation platforms, and infrastructure investments, NABARD is pushing for a transition that aligns rural finance with both farmer prosperity and long-term sustainability.
The shift toward value chain financing includes linking credit with logistics, processing, and marketing — areas traditionally outside the purview of rural banks. “We must recalibrate our approach to align with changing rural dynamics,” Sood asserted during the session.
Boosting Last-Mile Credit Delivery Through Cooperatives
The meeting also yielded a key breakthrough in cooperative banking. Regional Cooperative Banks announced their readiness to commence lending to Large Area Multi-Purpose Societies (LAMPS) and Primary Agricultural Credit Societies (PACS) for on-lending to farmers. This marks a significant deepening of last-mile financial inclusion, particularly in underserved rural pockets.
By empowering LAMPS and PACS with capital, these institutions can act as effective intermediaries to deliver micro-credit, technical support, and collective bargaining power to small and marginal farmers. The move is aligned with NABARD’s broader strategy of cooperative revitalization.
Advancing Sustainable Agriculture with JIVA Projects
Sood also launched three JIVA Natural Farming Projects in Jharkhand — specifically in Bhandra (Lohardaga), Bishnupur (Hazaribagh), and Saraiyahat (Dumka). These initiatives are part of NABARD’s nationwide mission to promote low-input, regenerative farming systems. By reducing dependency on chemical fertilizers and adopting nature-based practices, the JIVA model seeks to enhance farmer incomes while ensuring ecological resilience.
Sood interacted with project stakeholders — including Farmers’ Producer Organizations (FPOs), Tribal Development Committees, and Village Watershed Committees — via video conferencing, emphasizing the importance of community participation in driving rural transformation.
Site Visits Underscore Commitment to Field-Level Reform
During his multi-day visit to Jharkhand, the DMD of NABARD engaged directly with rural institutions and farmer groups. At Snehlata FPO in Rajrappa (Ramgarh), he explored strategies to improve market access, branding, and collective processing, encouraging members to strengthen their commercial footprint.
He later inspected a JIVA and Tribal Development Project in Patratu, reinforcing NABARD’s commitment to integrated tribal development and ecological farming.
At Namkum, he visited a model LAMPS operating under the PACS Computerisation Scheme. Joined by Suraj Kumar, Registrar of Cooperative Societies for the Government of Jharkhand, Sood formally handed over the ePACS certificate, symbolizing the digital transformation of grassroots institutions.
Symbolic Acts Reinforce Larger Themes
Beyond the institutional engagements, Sood took part in a tree plantation ceremony under the “Ek Ped Maa Ke Naam” (One Tree in the Name of Mother) initiative. This gesture, while symbolic, reflects NABARD’s growing emphasis on environmental stewardship as a critical element of rural development strategy.
The choice of Namkum LAMPS — a model cooperative society — served as a powerful backdrop for this initiative, aligning environmental awareness with ongoing cooperative reforms.
Conclusion
Ajay Kumar Sood’s visit and directives underscore a transformative moment for rural finance in India. As NABARD urges banks to embrace value-driven, digitally enabled, and ecologically responsible lending frameworks, the message is clear: the future of rural India hinges not just on credit disbursal, but on empowerment through innovation, inclusion, and integration. Whether through natural farming, digitized cooperatives, or market-linked models, the institution is steering India’s rural economy toward a more resilient and equitable horizon.
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