The once contentious legal notice obliging traditional pitkali traders to provide a bank guarantee has come into force.

The legal notice, published in the Government Gazette, says that every pitkal who applied for a licence renewal last December had to provide a bank guarantee equivalent to 10 per cent of the previous year’s turnover from the sale of agricultural produce.

Some suppliers originally resisted the guarantee. Last March they called on the court to stop the authorities from forcing them to provide the hefty bank guarantees. The court turned down their request.

The pitkala had argued that the guarantee threatened to destroy their livelihood and overlooked their role as middlemen between farmers and buyers.

It did not take into account the fact that the pitkala, who helped farmers secure the best price for the sale of their fruit and vegetables, received an eight per cent commission.

They said it did not make sense that pitkala were now expected to volunteer 10 per cent of their earnings from the sale of agricultural produce.

But the government insisted that the money would only be used in case a defaulting pitkal failed to pay farmers.

In April, the government issued a statement saying the issue had been resolved and all pitkala had made the requested guarantee.