Role of Small Farmer Cooperative Limitedin Rural Economic Development in Nepal: A Case Study of Baireni-SFCL,Baireni VDC Dhading district

Abstract

This study entitled “Role of Small Farmer Cooperative Limited (SFCL) in RuralEconomic Development in Nepal”: A Case Study of Baireni Small Farmer CooperativeLimited, Baireni, Dhading District was based on primary data collected in June 2006.Small farmer cooperative is a community based ruralfinancial institutionregistered underthe Cooperative Act 2048 and managed by small farmers of the study area. It isprincipally devoted to uplift the economic and social condition of the small farmers of thetarget area. In case of Dhading this Cooperative Limited has been continuously providingfinancial and non financial services since 2056 but the effectiveness of the services hasnot been measured yet so, this study was done to access the Role of SFCL in incomegenerating and employment creation in rural area. The main objective of the study was to trace out the role of SFCL in increasing ruralproductivity, entrepreneurship, employment generation. The specific objective of thisstudy was to examine the role of SFCL in income generation in rural community;employment opportunities by SFCL interventions in rural area. For the purpose of thestudy, the researcher had applied both exploratory and descriptive research design. Thesources of data were both primary and secondary and the nature of data was bothquantitative and quantitative. There are 457 house hold in Baireni VDC havingmembership of SFCL. Out of them 40 were selected as sample household from 5 wards ofthe VDC.The population of ethnic groups(44%) in which majority was Tamang. Bramhin andChhetri consists 38% with second positioning and occupational cast seems 18%. Tamanghave used their mother tongue and Nepali language both. Other castes used only Nepalilanguage. In case of religion Brabhin, Chhetri, Gurung and occupational are Hindu andTamang with both faith of Hinduism and Buddhism.The entrepreneurship pattern of members has also become changed. The shifting trendfrom traditional subsistence farming into commercial type has helped to increase theincome. This SFCL is providing loan tosmall farmers for income generating activitieslike (agronomy, livestock, agribusiness, cash cropping, and handicrafts) categorizingshort term and long term. The trend of borrowing loan from informal source issignificantly decreased and farmers have escaped from the high rated interest. Thesubsistence type of agriculture has changed into commercial type. Off season vegetable farming has become the major source of income, framers has motivated to intensivefarming. The housing condition of small farmers has improved Baireni SFCL is facing the problem of low repayment of loan; the repayment trend ofSFCLs’ loan is not satisfactory. The repayment rate of FY 059/060 is seemed only 40%of the disbursed amount of that year. Like this the repayment rate of FY 060/061 is alsoonly 41%. The repayment rate of loan is slightly improved in 061/062 with 54% of theyear’s disbursed amount. In spite of this, its economic activities like saving, credit andinsurance facilities to members it has contributed both technically and financially incommunity development activities (drinking water, sanitation, irrigation, school roofing,trial improvement, nursery management, seed and seedling management) and social activities like awareness raising, adult literacy class etc. so, Small farmer cooperativeLimited in Nepal is touched with the pro poor and marginal farmers of the state. SFCL is a community based grass root institution and has become the active player in rural economic arena.