Information Technology can bring prosperity to farmers by implementing multilevel crop trading with a profit-sharing mechanism. Besides benefiting the farmer who produced it, all the middlemen who were involved in the early trading of the crop, it has many other advantages e.g. Cashless Transaction, Minimizing the transportation and storage cost with zero loadings on the farmers, Ensuring the availability of Good quality seed, urea, irrigation, etc. to farmers with minimum cost (maybe subsidized), Easy Loan sanctioning to farmers and middlemen, etc.
The Framework
All vendors and farmers (may use Gram Panchayats/NGOs) need to register themselves with MPU (AADHAR no. may be used as identity number for all individuals). The farmer needs to declare the quantity and quality of the crop available with him. The vendor ‘X’ may hire an appropriate vehicle and move on a specific route to procure the crops from the farmers on the minimum price or above. The vendor X needs to log into MPU and fill the voucher containing information like the registration number of farmers, the quantity and quality of crop purchased from him, and the optional feature of collecting and uploading biometric data as well for counter authentication. The application running at MPU will transfer the appropriate fund from the vendor's bank account to the farmer's bank account (no cash transaction). Vendor X will store the crops in an appropriate storage house and update this storage information on the MPU. Whenever vendor X sells it to vendor 'Y', then Y should enter the trading details for the online transfer of funds. The application running at MPU will use the appropriate algorithm for calculating the shares of the profit among X and all the farmers from whom X had bought this crop. The MPU will accordingly issue instructions to respective banks for transferring funds from the account of Y to X and these groups of farmers. A similar cycle should be repeated at the time of each trading i.e. whenever Y sells it to Z then along with Y the vendor X and these farmers should again automatically get their part of the profit. Thus, each trading should generate some bonus for each member of the chain (including the farmers) until the crop is finally consumed by the end-user. In all intermediate trading, transportation is not needed. Just MPU updates the ownership of crops in various storages which is a huge saving.
Other Benefits
1. Storage house owners, Seed, urea, medicine vendors, irrigation service providers, etc. people may also register at MPU, and their services may be hired by farmers/vendors.
2. Banks may look into the profiles of various farmers/vendors and take the decision on loan amounts.
3. Small Applications may be created and all needful services may be provided over mobile networks using standard mobile phones.
2. Banks may look into the profiles of various farmers/vendors and take the decision on loan amounts.
3. Small Applications may be created and all needful services may be provided over mobile networks using standard mobile phones.
