In This Bengaluru APMC Yard, Karnataka Farmers Embrace Digital Economy

Anjayaneyalu, a 50-something farmer from Rayadurga in Andhra Pradesh’s Anantapur district, has travelled over 250 kilometres from his home to the Agricultural Produce Marketing Committee (APMC) yard in Yeshwanthpur, north-east of Bengaluru to sell the onions he has grown on his farm. He had left his home around 5 am with 10 tonnes of his produce and reached the APMC yard around 8 am. By 9.30 am, he had sold all of his produce at Rs 6,000 a tonne on the platform meant for onions.

“I now have two options to get the payment from the trader who sold my onion. Either he will give me a cheque or I will give him my bank account number and he will deposit the money through electronic transaction,” says Anajaneyalu, looking forward for a settlement in the next one hour or so.

This farmer from Rayadurga has been coming to the Yeshwanthpur APMC for the last five to six years. “In the initial years, I used to get the settlement in cash. But over the last one and half years, I have got used to getting payment in cheques or electronic transfer,” he says. “My money is being settled within a week by the agent.”

A little farther, a 40-year-old bachelor farmer Rajanna had brought 350 bags of potatoes from Narsapura village in Karnataka’s Kolar district. Leaving home around 6 am, he had travelled nearly 100 km to reach Yeshwanthpur APMC by 8 am. He too had sold all his produce at Rs 700 per 50-kg bag by 10 am. “I will get a cheque for my potatoes but whenever I am in desperate need of cash, the commission agent obliges,” says Rajanna, who grows vegetables and mulberry on his farm. “Payment mode has changed in the last one year or so but if required, my agent can give me cash of Rs 2 lakh,” he says.

Potatoes and onions are the primary agricultural produce sold at the Yeshwantpur APMC yard. Over 2,000 lorries bring these commodities to the yard every day. There are other commodities like coconut, groundnut, pulses and wheat too that are traded in the yard. Commodities worth Rs 15 crore are traded every day at the market that has helped the market earn over Rs 35.14 crore as market fee during 2016-17 fiscal.

“Most of the payments are either made through cheques or electronic transfer. Some farmers take money in advance from us. We deduct that and remit the rest that is due to them,” said a commission agent at the yard.

“Except for small traders who buy less than 10 bags of onions or potatoes, the rest pay in cheque. Farmers, too, unless they insist are paid in cheques,” says T Ravi, a trader who gets onions for his clients in Tamil Nadu.

Onion arrivals peak at the APMC Yard around September, while potatoes start coming sometime in January. While onion arrivals peter out by November, potato supplies last till early April. Besides, the Yeshwanthpur APMC receives onions from neighbouring Maharashtra, while potatoes come from faraway Agra in Uttar Pradesh.

“After demonetisation was announced in November 2016, cash transactions have dropped drastically. Over 70 per cent of transactions are cashless, through cheques or electronic transfer, depending on the convenience of farmers. In the case of buyers from outside the state, the dealings are in cheques,” said Ravi. A few other traders, who earn Rs 3,000 per lorry load of 12 tonnes of onion or potato they get for buyers outside Bengaluru, with him agreed that in the case of some traders, cash transactions are less than five per cent of the total trading they deal with.

“We faced problems initially when demonetisation was implemented. But things have improved and far better these days,” says Selvaraj, a daily worker at the yard.

Daily workers say that arrivals too dropped soon after demonetisation and they faced problems. But things have changed now.

“For us, it is a payment of less than Rs 500 daily at the yard. We get that in cash from the parties involved. Trading between farmer and the commission agent or a buyer and the agent are mostly settled without cash,” says Yogesh Kumar, another worker along with his friend Venkatesh.

However, there are some exceptions to the general trend at the APMC yard. Transactions in coconut trading are made through cash. “Farmers from Tamil Nadu, Kerala and interior Karnataka bring coconuts to this market. Four or five growers bring coconut, hiring a lorry. Suppose if we pay Rs 2 lakh for a lorry load of coconuts, the money has to be distributed among the farmers. These farmers take only cash,” says Venkatesh, a coconut commission agent at the APMC yard.

However, the bottom line is that with the Narendra Modi government promoting digitalisation and an economy that would see less of cash transactions, the Yeshwanthpur APMC yard, where farmers from nearby areas converge to sell their produce, is a testimony to this transition. “Farmers are accepting payment through cheques or electronic transfer. They are finding it convenient,” says Ravi.

“I don’t have any problem in accepting these payment modes. Whatever money I need, I go to the bank and withdraw,” says Anjayaneyalu.

Farmers, commission agents, traders and the daily workers are now part of a rapid change in Indian economy towards digital transactions. And Yeshwanthpur APMC yard is a proof of this change.