A kacha arhti acts purely as a commission agent — facilitating the sale between farmer and buyer and earning adhat — while a pakka arhti also trades on their own account, buying lots and reselling them at a margin. Most Pakistani mandis run on the kacha-arhti model, where the adhati never owns the goods and the farmer carries the price risk.
What does a kacha arhti actually do?
The kacha arhti receives the farmer's lot, auctions it via boli, collects from the buyer, deducts adhat and charges, and pays the farmer the net. They earn commission, not trading profit, and they do not take ownership of the goods.
How is a pakka arhti different?
A pakka arhti can buy a lot outright and resell it later, earning the spread rather than (or in addition to) commission. That means they carry inventory and price risk — closer to a beopari than a pure agent.
How does settlement differ?
In kacha settlement the buyer pays the gross, the adhati deducts charges, and the farmer gets the net — a two-sided flow on one parchi. In pakka settlement the arhti's purchase and onward sale are two separate transactions in their own khata. Pakka Khata supports both flows natively; see Pakka Khata for Adhatis and the full kacha vs pakka arhti glossary entry.
Frequently asked questions
Which model is more common in Pakistan?
The kacha-arhti (commission-only) model dominates most notified mandis.
Does a pakka arhti need more capital?
Yes — because they buy stock on their own account, they tie up working capital and carry price risk that a kacha arhti does not.
Can one business do both?
Yes. Many operate as kacha arhti for most lots and occasionally buy on own account; a good khata keeps the two cleanly separated.
