Deepak Project -Phpapp02

CHAPTER -1-:

INTRODUCTION

1. INTRODUCTION TO THE TOPIC

2. OBJECTIVE

3. FUNCTIONING AREA FOR THE PROJECT

4. METHODOLOGY

5. LIMITATIONS

INTRODUCTION

This project is emphasized on analysis of Banking And Bank as an Investment

Destination at OSCB Ltd. An investment refers to the commitment of funds at present,

in anticipation of some positive rate of return in future. Today the spectrum of

investment is indeed wide. An investment is confronted with array of investment

avenues. Among all investment, investment in equity is in best high proportion. This is

because the history of stock market is booming and bursts overnight millionaires, an

instant pauper. Indian economy is doing indeed well in recent years. The study has been

undertaken to analyze the investment pattern of investment community. The main

reasons behind the study are the factors like income, economy condition, and the risk

covering nature of the Indian investors. The percentage of Indian investors investing in

the Indian equity market is very less as compared to foreign investors. This study has

been undertaken in Asit C. Mehta Investment Interrmediates Ltd. (ACMIIL), which was

incorporated in the year 1986. And the company, which is, diversified into many fields

like securities, insurance, distribution, commodities and investment services. This

project contains the investors’ preferences and as well as the different factors that affect

investors decision on the different investment avenues most of them investors are the

clients of Asit C. Mehta Investment Interrmediates Ltd., which provides a complete

bouquet of products in equity, debt, commodities, forex, depository, derivatives and

allied services in India . This study includes response of investor in choosing securities

in each classification and analysis has been for the respective performance based on their

returns. The findings relates to the outperforming products and investors risk taking

ability while investing in each different products The Co-operative banks are an

important constituent of the Indian Financial System, judging by the role assigned to

them, the expectations they are supposed to fulfill, their number, and the number of

offices they operate.

The co-operative movement originated in the West, but the importance that such banks

have assumed in India is rarely paralleled anywhere else in the world. Their role in rural

financing continues to be important even today, and their business in the urban areas

also has increased phenomenally in recent years mainly due to the sharp increase in the

number of primary co-operative banks. Co-operative bank regulated by Reserve Bank of

India, NABARD & Apex bank.

The co-operative societies play a significant role in the economic development of the

country. India is basically an agrarian economy with majority of population residing in

rural areas. Agricultural sector contributes 22.1 percent of the country's gross domestic

product and offers employment to nearly 65 percent of the rural labour. The two third of

the population depend on agriculture for livelihood. So growth of agriculture and

poverty alleviation is significant objective of every co-operative society and bank.

Through co- operative societies it is possible to reach last man in village. They provide

finance to agrarians at low rates of interest, and thereby relieve them from the clutches

of the money lender. But the pin problem is recovery management. The unrecovered

loan which is termed as NPA is a great headache for the banks especially in rural areas.

So, to have a prevalent picture about how the co-operative banks manage the non-

performing assets, we have undertaken a study by referring a well known co-operative

agricultural bank.

PLACE OF STUDY

All activities of this project were carried out in Agricultural Co-operative staff training

institute of Odisha state Co-operative Bank Ltd, Bhubaneswar.

OBJECTIVES OF THE STUDY

The objective of this research is to analyze the following points:

1. To study the Indian Banking System

2. To study in detail the functioning of Co-Operative Bank

3. To study in detail the functioning of private banks of India

4. The analysis of the investment products and services provided by Co-Operative Bank and ways to improve them to improve the profitability of theBan

FUNCTIONING AREA FOR THE PROJECT

By formulating the idea of the project I had planned a strategy

I had taken the full detailed study of about the investment products

offered by the bank.

I studied the previous Investment based sales of the banking products.

I observed the criteria of the people who visited the bank and their

views on investments with bank.

I talked with customers during their transaction period with the bank

officials.

SURVEY DESIGN

The study completely depends on the secondary data. The secondary data collected from

the OSCB’s annual report, official documents and guidance of department head, reading

materials, journal, and magazines

RESEARCH METHODOLOGY

Research is a common language refers to search of knowledge. Research is scientific and

systematic search for pertinent information on a specific topic; in fact research is an art

of scientific investigation. Research methodology is a way to systematically solve the

research problem. The researcher is expected to know the various techniques to be

presented in the research work to arrive at a conclusion. The researcher should know

what types of techniques are appropriate to his study and why. For the purpose of the

study necessary information has been collected through primary and secondary sources.

PRIMARY DATA: The primary data are those which are collected a fresh and

for the first time, and thus happened to be original in character. Primary data

include the information collected from the officials and existing company through

discussions, direct personal interview, information from correspondents, mailed

questionnaire.

SECONDARY DATA: The secondary data, on the other hand are those

which have already been collected by someone else and which have already been

passed though the statistical process. The secondary data include the information

from the company annual report which include financial statement like balance

sheet and income statement and such other information from the test books of

financial management, newspaper, libraries and website. Journals and different

magazine has also been collected.

DATA CHOICE

Any organization whether big or small, private or public need different types of

information are to know its popularity. I have gathered secondary data and collected

information from that.

In this project sincere effort has been made to study the NPA Analysis of the

OSCB Bank.

The secondary data was collected through journals, report of the Bank and books.

Diagrams and graphs are used for analyze and interpretation of the data

RESEARCH METHODOLOGY

Research Methodology refers to the tools and methods used for obtaining

information for the purpose of study Data was collected from secondary; their

current brand strategies were determined. After a thorough analysis of the above

they were evaluated and suggestions for future are made.

RESEARCH DESIGN

The preliminary research involved collecting data from the secondary sources to

understand the background and the nature of phenomenon. After this, an exploratory

research was undertaken the factors of less sale of investment products and give a

complete account of their strength.

CONSUMER FEEDBACK ANALYSIS

Data collection: Sample size was 150.

During my data collection, data was collected from:-

Visitor

Bank customer

Shopkeeper

LIMITATIONS OF THE STUDY

The following aspects have been identified on some of the major areas of concern for the

bank :

Delay in submission of statutory returns.

Bank's performance in implementation of schemes, formulate for

reshedulment of agriculture loans accounts on account of farmers in arrears was

not found to be satisfactory.

Wrong classification of rescheduled accounts under IRAC norms.

Defective documentation

Problem of imbalance at GSS level.

Lack of internal checks and control system

Poor fund management

Operational deficiencies and poor growth rate in loans and advances

and deposits.

Operational deficiencies and poor growth rate in loans and advances

and deposits.

Over dependence on the short term loans there by reduction in the

interest margin.

Non diversification of loans portfolio. Bank should increase its

funding in medium terms and long terms loan.

Nonuse of latest credit intervention initiatives such as Kisan club,

SHPIs, REDPs, TME cell WD Cell, etc.

Meager financing in SHGs.

Poor HRD planning and training

Lack of Supervision and initiative for strengthening the PACS on

other affiliated societies.

Lack of supervision and initiatives for strengthening the PACS and

other affiliated societies.

No use of advance technology such as computerization etc.

Poor security arrangements at branch level

CHAPTER-2Company profile

Introduction to Banking Industry

Growth of Indian Financial Sector

Cooperative Banks in India

About Orissa State Co-operative Bank Ltd.

Financial Highlights of Orissa State Co-operative Bank Ltd.

Retail Banking of Orissa State Co-operative Bank Ltd.

Introduction of Corporate Governance by OSCB Ltd.

Introduction to Banking Industry

Introduction:

Modern banking in India is said to be developed during the British era. In the 1st half of

the 18th century, the British East India Company established three banks -the Bank of

Bengal in 1809, the Bank of Bombay in 1840 and the Bank of Madras in 1843. But in

the course of time these three banks were amalgamated to a new bank called Imperial

Bank and later it was taken over by the State Bank of India in 1955. Allahabad Bank

was the first fully Indian owned bank. The Reserve Bank of India was established in

1935 followed by other banks like Punjab National Bank, Bank of India, Canara Bank

and Indian Bank.

In 1969, 14 major banks were nationalized and in 1980, 6 major private sector banks

were taken over by the government. Today, commercial banking system in India is

divided into following categories.

Types of Banking:

1. Central Bank

The Reserve Bank of India is the central Bank that is fully owned by the government. It

is governed by a central board (Headed by a Governor) appointed by the Central

Government. It issues guidelines for the functioning of all banks operating within the

country.

2. Public Sector Banks

A.State Bank of India and its associate banks called the State Bank Group

B. 19 Nationalized Banks

C. Regional Rural Banks mainly sponsored by public sector banks

3. Private Sector Banks

A.Old generation private banks

B. New generation private banks

C. Foreign banks operating in India

D.Scheduled co-operative banks

E. Non-scheduled banks

4. Co-operative Sector

The co-operative sector is very much useful for rural people. The co-operative banking

sector is divided into the following categories:

A.State co-operative Banks

B. Central co-operative banks

C. Primary Agriculture Credit Societies.

5. Development Banks/Financial Institutions

A. IFCI

B. IDBI

C. ICICI

D. IIBI

E. SCICI Ltd.

F. NABARD

G. Export-Import Bank of India

H. National Housing Bank

I. Small Industries Development Bank of India

J. North Eastern Development Finance Corporation

Banking Services:

Banking in India is so convenient and hassle free that one (individual, groups or

whatever the case may be) can easily process transactions as and when required. The

most common services offered by banks in India are as follow:

Bank Accounts:

It is the most common service of the banking sector. An individual can open a bank

account which can be either savings, current or term deposits.

Loans:

You can approach all banks for different kinds of loans. It can be a home loan, car loan,

and personal loan, loan against shares and educational loans.

Money Transfer:

Banks can transfer money from one corner of the globe to the other by issuing demand

drafts, money orders or cheques.

Credit and Debit cards:

Most of the banks offer credit cards to their customer who can be used to purchase goods

and services on credit. On the other hand debit card also used to draw cash easily.

Lockers:

Most banks have safe deposit lockers which can be used by the customers for storing

valuable, important documents or jewellery.

Banking Services for NRIs:

Non Resident Indians or NRIs can open accounts in almost all Indian banks. The three

types of accounts that NRIs can open are:

a. Non-Resident (Ordinary) Account - NRO A/c

b. Non-Resident (External) Rupee Account - NRE A/c

c. Non-Resident (Foreign Currency) Account - FCNR A/c

Banking and Finance:

Banking industry in India has evolved lately under the impact of the stimulus packages

announced by the Government. According to the Annual Policy 2008-09 of the Reserve

Bank of India (RBI), the central bank, key monetary aggregates have witnessed some

growth in 2008-09.

This is reflected in the changing liquidity positions arising from domestic and global

financial conditions and the policy initiatives taken by the government. Also, reserve

money variations during 2008-09 have largely reflected an increase in currency in

circulation and reduction in the cash reserve ratio (CRR) of banks.

According to a study by Dun & Bradstreet (an international research body)-"India's Top

Banks 2008"-there has been a significant growth in the banking infrastructure. Taking

into account all banks in India, there are overall 56,640 branches or offices, 893,356

employees and 27,088 ATMs. Public sector banks made up a large chunk of the

infrastructure, with 87.7 per cent of all offices, 82 per cent of staff and 60.3 per cent of

all automated teller machines (ATMs).

The Credit Scenario

The year-on-year (y-o-y) aggregate bank deposits stood at 21.2 per cent as on January 2,

2009. Bank credit touched 24 per cent (y-o-y) on January 2, 2009 as against 21.4 per

cent on January 4, 2008. The year-on-year (y-o-y) growth in non-food bank credit at

23.9 per cent as on January 2, 2009 was higher than that of 22.0 per cent as on January

4, 2008. Increase in total flow of resources from the banking sector to the commercial

sector was also higher at 23.4 per cent as compared with 21.7 per cent a year ago.

The incremental credit-deposit ratio rose to 81.4 per cent as on January 2, 2009, as

against 63.1 per cent as on January 4, 2008. Also, during 2008-09 so far, the total flow

of resources to the commercial sector from banks stood at US$ 58.83 billion up to

January 2, 2009. Scheduled commercial banks' credit to the commercial sector expanded

by 27.0 per cent (y-o-y) as on November 21, 2008, as compared with 23.1 per cent a

year ago.There has been variation in credit expansion across bank groups.

Credit expansion as on January 2, 2009 for public sector banks stood at 28.6 per cent,

scheduled commercial banks (SCBs) including the regional rural banks (RRBs) at 24 per

cent, foreign banks at 6.9 per cent and private sector banks at 11.8 per cent, according to

the Annual Policy for 2008-09 of Reserve Bank of India.

Several measures initiated by the Reserve Bank have resulted in banks reducing their

deposit and lending rates between November 2008 and January 2009. The range for

deposit rates for public sector banks varied from 5.25 to 8.5 per cent, foreign at 5.25 to

7.75 per cent and private sector banks at 4 to 8.75 per cent.

In the post-crisis quarter caused due to collapse of Lehman Brothers, large corporate

like Infosys moved their deposits to State Bank of India (SBI), the country's largest

bank. Infosys has revealed that it transferred deposits of nearly US$ 200.61 million from

ICICI Bank to SBI last year.

Deposits as on January 2, 2009 for public sector banks stood at 24.2 per cent, scheduled

commercial banks (SCBs) including the regional rural banks (RRBs) at 21.2 per cent,

foreign banks at 12.1 per cent and private sector banks at 13.4 per cent, according to the

Annual Policy for 2008-09 of the Reserve Bank of India.

The prime lending rates of public sector banks stood at 12 to 12.5 per cent, private sector

banks at 14.75 to 16.75 per cent and foreign banks 14.25 to 15.50 per cent as on January

2009.

Bank loans rose 18.1 per cent on year-on-year basis as on March 13, the RBI has said in

its Weekly Statistical Supplement released on March 27, 2009. Outstanding loans rose to

US$ 541.82 billion in the two weeks to March 13. The non-food credit rose to US$

530.19 billion in the two weeks, while food credit stood at US$ 9.61 billion in the same

period.

Since October 2008, the central bank has cut the cash reserve ratio, or the proportion of

deposits that banks set aside, and the repo rate, or the rate at which it lends to banks, by

400 basis points each to inject liquidity into the system and activate a lower interest rate

regime. Also, the reverse repo rate has been lowered by 200 basis points to discourage

banks from parking surplus funds with RBI. Till April 7, 2009, the CRR had further

been lowered by 50 basis points, while the repo and reverse repo rates have been

lowered by 150 basis points each. Public sector banks have pruned their benchmark

prime lending rates (BPLRs) by 150-200 basis points.

Also, in April 2009, private sector banks such as Axis and Bank of Rajasthan have

reduced their BPLRs by 50 basis points. Only few foreign banks such as Citibank have

pared home loan rates by 50 basis points to 13.75 per cent.

The rupee depreciated during 2008-09, reflecting varied developments in international

financial markets and portfolio outflows by foreign institutional investors (FIIs). The

rupee exchange rate was between 48.37 to 49.19 against the US dollar and 63.60-68.09

against the Euro in January 2009.

Government Initiatives

Apart from the bank rate cuts announced in the stimulus packages, cash withdrawals

from bank will not attract tax from April 1, 2009 following abolition of the banking cash

transaction tax (BCTT) in the Union Budget 2008-09. The total collection of BCTT

stood at US$ 120.36 million in 2008-09. Also, inter-ATM usage transaction became free

of charges effective April 1, 2009.

Exchange rate used: 1 USD = 49.8417 INR

GROWTH OF INDIAN FINANCIAL SECTOR

The far-reaching changes in the Indian economy since liberalization have had a deep

impact on the Indian financial services sector. Financial sector reforms that were

initiated by the government since the early ‘90s have been to meet the challenges of a

complex financial architecture. This has ensured that the new emerging face of the

Indian financial sector will culminate in a strong, transparent and resilient system.

Broadly, financial sector reforms can be categorized in two phases. The first phase of

economic reforms that started in 1985 focused on increasing productivity, new

technology import and effective use of human resources. These efforts were in line with

the changes in international markets, organizations and production areas. In the second

phase, beginning in 1991-92, the government aimed at reducing fiscal deficit by opening

the economy to foreign investments. Financial sector reforms during this period focused

on modification of the policy framework, improvement in financial health of the entities

and creation of a competitive environment. These reforms targeted three interrelated

issues viz. (i) strengthening the foundations of the banking system; (ii) streamlining

procedures, upgrading technology and human resource development; and (iii) structural

changes in the system.

The last decade witnessed a significant broadening and deepening of financial markets

with the introduction of several new instruments and products in banking, insurance and

capital markets space.

During this time, the Indian financial sector (banking, insurance and capital markets)

opened up to new private players including foreign companies. The new players adopted

international best practices and modern technology to offer a more sophisticated range of

financial services to corporate, retail and institutional customers. The consequent

competition in the market brought in innovation, better customer service and efficiency

in the financial sector in India.

Financial sector regulators too have been proactive in ensuring that new regulations and

guidelines are more or less in tandem with the growth in the financial sector. Financial

intermediaries have gradually moved to internationally acceptable norms for income

recognition, asset classification, provisioning and capital adequacy. These developments

have given a strong impetus to the development and modernization of the financial

sector in India. Going forward the aim would be to achieve international standards in

this area within the shortest possible period.

India’s services sector has been the most dynamic part of its economy, leading GDP

growth for past two decades. India serves as an example as to how services sector can

play an important role in a country’s economic growth. India is doing reasonably well in

retail sector and the financial sector including insurance. India is now eager to open up

the pensions sector also to foreign investors. The way these sectors have been developed

with a robust regulatory and policy framework also holds important lessons for other

countries. India’s financial services sector has been one of the fastest growing sectors in

the economy.

The economy has witnessed increased private sector activity including an explosion of

foreign banks, insurance companies, mutual funds, and venture capital and investment

institutions. Although significant steps have been taken in reforming the financial sector,

some areas require greater focus.

Growth in the Indian economy

The performance of the Indian economy is one of the strongest drivers for the banking

industry’s growth and vice versa and the average GDP growth of 8.1 per cent expected

over 2011–16 will facilitate the expansion of the banking sector27. The government

policies bringing in monetary stability will also benefit and shield the industry from global

economic or political turmoil.

A boost in the banking industry is also expected from the rising per capita income In

India, which along with a growth in the earning population of the country will lead to a

higher number of people utilising banking services27?

The per capita income growth is expected to be a major driver, as the Indian population

primarily comprises of conservative spenders who invest in property and other

necessities. Higher disposable income will increase the retail credit, with consumers

investing in a wide range of products However, the basic goods, intermediate goods and

consumer goods sectors recorded decelerated growth of 7.0 per cent, 8.9 per cent and 6.1

per cent, respectively, during 2012-13.

The performance of the industrial sector was also affected by the subdued performance

of the infrastructure sector, registering 5.6 per cent growth during 2012-13. The services

sector recorded double digit growth consistently in the last three years. It grew by 10.7

per cent during 2012-13, on top of 11.2 per cent growth in 2011-12.

The Reserve Bank during 2012-13 had to contend with large variations in liquidity not

only due to swings in cash balances of the Central Government, but also on account of

large and volatile capital flows. The Reserve Bank judiciously used the CRR, LAF and

MSS to manage such swings in liquidity conditions, consistent with the objectives of

price and financial stability. As a whole, there was a net absorption of liquidity on 171

days and net injection of liquidity on 75 days during 2012- 13. The average daily net

outstanding balances under LAF varied between injections of Rs.10, 804 corers during

December 2012 to absorption of Rs.36, 665 corers in October 2013. Net issuances under

the Market Stabilisation Scheme (MSS) during 2012-13 amounted to Rs.1, 05,691

corers.

In the foreign exchange market, the Indian rupee exhibited two-way movements in the

range of Rs.39.26-43.15 per US dollar during 2012-13. The Indian rupee depreciated to

Rs.41.58 per US dollar on August 17, 2012 from Rs.40.43 per US dollar on July 31,

2012. The exchange rate of the rupee appreciated thereafter up to January 2008. The

rupee moved in a range of Rs.39.26-39.84 per US dollar during October 2012- January

2013.

However, the rupee started depreciating against the US dollar from the beginning of

February 2013 on account of FII outflows, rising crude oil prices and heavy dollar

demand by oil companies. The exchange rate of the rupee was Rs.39.99 per US dollar at

end-March 2013.

Co-operative Banks in India

The Co operative banks in India started functioning almost 100 years ago. The

Cooperative bank is an important constituent of the Indian Financial System, judging by

the role assigned to co operative, the expectations the co operative is supposed to fulfil,

their number, and the number of offices the cooperative bank operate. Though the co

operative movement originated in the West, but the importance of such banks have

assumed in India is rarely paralleled anywhere else in the world. The cooperative bank

in India plays an important role even today in rural financing. The businesses of

cooperative bank in the urban areas also have increased phenomenally in recent years

due to the sharp increase in the number of primary co-operative banks.

Co operative Banks in India are registered under the Co-operative Societies Act. The

cooperative bank is also regulated by the RBI. They are governed by the Banking

Regulations Act 1949 and Banking Laws (Co-operative Societies) Act, 1965.

Cooperative banks in India finance rural areas under:

i. Farming

ii. Cattle

iii. Milk

iv. Hatchery

v. Personal finance

Cooperative banks in India finance urban areas under:

i. Self-employment

ii. Industries

iii. Small scale units

iv. Home finance

v. Consumer finance

vi. Personal finance

Some facts about Cooperative banks in India

i. Some cooperative banks in India are more forward than many of the state and private

sector banks.

ii. According to NAFCUB the total deposits & landings of Cooperative Banks in

India is much more than Old Private Sector Banks & also the New Private Sector Banks.

iii. This exponential growth of Co operative Banks in India is attributed mainly to

their much better local reach, personal interaction with customers, and their ability to

catch the nerve of the local clientele.

Orissa State Co-operative Bank Ltd.

The Orissa State Co-operative Bank, a Scheduled Bank under RBI Act was registered in

the year 1948 as the Apex Bank of the short term Coop.

Credit structure of Orissa with an objective of Development of the agrarian economy of

Orissa by catching the credit equipment of the terms of the state.

The OSCB had made a humble beginning with a Share Capital of Rs. 1.76 lakhs and a

borrowing of Rs.25.50 lakhs to address the problem of farm credit dispensation. The

OSCB, in its own way has contributed in providing farm credit and inputs to bring the

desired change over the years.

The Bank has been trying to develop the primary society’s viz. PACS (Primary

Agricultural Co-operative Society) which constitutes of schemes as LAMPS (Large

Scale Agriculture Multipurpose Co-operative Society) / FSS (Farmers Service Co-

operative Society).

The activities of the OSCB are not confined to dispensation of farm credit alone. As a

schedule bank, it has responded to the sweeping change in banking service in view of

advancement in Information Technology.

The Bank has assumed the role of leader of the Coop - Credit Structure to develop the

lower tiers to cope with the emerging challenges of banking activities. The activities of

OSCB are

General Banking Business

Re-finance to the DCCB

Dispensation of farms credit

Production Credit

HISTORY

With the growth of central banks, the need for loans and advances and cash credit at a

reasonable rate of interest grew central banks to enable them to make adequate finance

available to the societies. So in April 1914 the Bihar and Odisha provincial co-operative

Bank was formed.

The early 40s witnessed the information of provincial in all British Indian provinces and

what was of paramount importance was the birth of the “Odisha provinces” on 1 st April

1936. The Odisha provincial co-operative Bank is one of the manifestations of the great

historical identity of Odia people.

During this period the number of central banks in North Odisha and South Odisha are 13

and 2 respectively.

A few months after the formatting of the separate Odisha province the Odisha Co-

operative bank was registered on 15th August 1936 and of Rs 10520 was collected

towards share capital of the bank.

The main objective of the bank was:

To finance the co-operative bank societies.

To act as a balancing centre for the surplus funds of the societies in Odisha.

To carry on banking business,

The central bank and union of Odisha applied for the bifurcation of the Bihar and Odisha

provincial co-operative bank the 13center co-operative bank in 1938, and their net

liability to the bank was taken over by Odisha Government.

The Odisha provincial Co-operative bank registered on 15th August 1936 could not its

function due to pending of Government decision on the enquiry in to the conditional of

the co-operative movement in Odisha. There was no apex bank for the 13 northern

CCBs. However the two southern CCBs were obtaining loans from the Madras province

co-operative bank as usual.

On 2nd April 1948 the Odisha provincial co-operative bank was again registered under

the Bihar and Odisha co-operative society Act 1953, 22 members were enrolled and

hundreds were issued and share capital of Rs. 10000 was collected. So it was twice born

of the bank.

The name of the “Odisha provincial Co-operative” was changed to “Odisha state Co-

operative bank” in the year 1951- 1952.

The institutional rural credit delivery system of Agriculture comprise of:

Short term Co-operative credit structure.

Long term Co-operative credit structure.

Regional rural bank

Commercial bank

NABARD

Reserve bank of India

The co-operative societies play a significant role in the economic development of the

country.

India is basically an agrarian economy with majority of population residing in rural

areas. Agricultural sector contributes 22.1 percent of the country's gross domestic

product and offers employment to nearly 65 percent of the rural labour. The two third of

the population depend on agriculture for livelihood. So growth of agriculture and

poverty alleviation is significant objective of every co-operative society and bank.

Through co- operative societies it is possible to reach last man in village. They provide

finance to agrarians at low rates of interest, and thereby relieve them from the clutches

of the money lender. But the pin problem is recovery management.

The unrecovered loan which is termed as NPA is a great headache for the banks

especially in rural areas. So, to have a prevalent picture about how the co-operative

banks manage the non-performing assets, we have undertaken a study by referring a well

known co-operative agricultural bank.

Co-operative Credit Institution

The term 'Co-operation' means the idea of "living together and working together." Banks

established under the Co-operative system are called as “Co- operative” banks. Co-

operative banking was started in India to remove the poverty of the millions and grant

funds for small agriculturists. It was found that co-operative banking is the most useful

weapon to meet the financial needs of medium and small farmers, artisans and traders.

The co-operative banks play as substitutes for money lenders to provide timely and

adequate short medium and long term institutional credit at reasonable rate of interest.

The Co-operative banks are working successfully and playing a vital role even today in

financing for agricultural and allied activities. Co- operative banks have advanced more

credit in the Indian agriculture sector than commercial banks. They have made an all-

around progress and contributed highly towards agricultural sector.

THE INDIAN BANKING SCENARIO

INCUMBENCY CHART OF PRESIDENTS OFTHE ODISHA STATE COOPERATIVE BANK LTD., BHUBANESWAR

SL

NoNAME

Period

From To

1 Sri M. L. Pandit (Nominated) 02.04.48 31.03.59

2 Sri R. C. Mardaraj Deo (Nominated) 01.04.59 15.01.61

3 Sri A. B. Das 16.01.61 13.12.64

4 Sri B. C. Hota 14.12.64 14.05.70

5 Sri P. C. Samantasinghar 15.05.70 14.09.75

6 Dr. J. C. Rout 15.09.75 09.07.81

7 Sri Niranjan Pattnaik (President-in-charge) 10.07.81 29.08.82

8 Sri Jagabandhu Das 30.08.82 15.09.86

9 R.C.S., Odisha (Management-in-charge) 16.09.86 14.02.88

10 Sri Surendranath Pattanaik 15.02.88 28.06.90


12 Sri Ghanashyam Sahu (Nominated) 27.03.92 05.05.94


14 Sri Jagneswar Babu 28.09.94 01.02.96


16 Sri Surendranath Pattanaik (Nominated) 06.02.96 20.04.98

17 Sri Surendranath Pattanaik (Elected) 21.04.98 26.03.01

18 Commissioner-cum-Secretary to Govt. of

Odisha, Cooperation Department (Management

–in-Charge)

26.03.01 28.03.01


20

Principal Secretary to Govt. of Odisha,

Handloom, Textiles and Sports Department

(Administrator)

08.06.01 18.06.01



23 Sri Sanjib Ch. Hata, IAS, Agriculture

Production Commissioner, Govt. of Odisha

01.09.01 29.01.03

24 Sri Jagneswar (Nominated) 30.01.03 19.05.04

25 Sri H. S. Chahar, IAS, Commissioner-cum-

Secretary to Govt. of Odisha, Cooperation

Department (Management-in-charge)

19.05.04 24.06.04

26 Sri Jagneswar (Nominated) 2406.04 22.08.05

27 Ms. Madhur Sarangi, IAS, Principal Secretary

to Government of Odisha, Cooperation

Department (Management-in-charge)

23.08.05 27.09.06


29 Sri Jagneswar (Elected) 14.03.08 23.09.11


31. Sri B.B. Mohapatra, IAS, Commissioner-cum-

RCS(O)

24.07.12 31.07.12

32. Sri P.K. Patnaik, IAS, RCS(OManagement-in-Charge)

06.08.12 05.02.13

33. Sri Bishnupada Sethi, IAS, Commissioner-

cum-Secretary to Government of Odisha,

Cooperation Department, (Management-in-

Charge)

06.02.13 Continui

ng

‘INCUMBENCY CHART OF MANAGING DIRECTORS OF

THE ODISHA STATE COOPERATIVE BANK LTD., BHUBANESWAR

SL No Name Period

From To

1 Sri T. R. Rau (Organiser from 16.04.47 to

29.01.48)

30.01.48 30.09.48

2 Sri Y. V. Rajulu 01.10.48 31.03.49

3 Sri P. L. Misra 01.04. 49 14.07.49

4 Sri Appa Rao Choudhury 15.07.49 25.08.49

5 Sri Y. R. Bali 26.08.49 19.04.71

6 Sri P. K. Patnaik 19.04.71 11.04.73

7 Sri Ratnakar Mohanty 14.02.74 29.04.75

8 Sri F. C. Panda 07.07.75 31.10.81

9 Sri Natabara Biswal 21.11.81 30.06.85

10 Sri R. Patro 02.09.85 14.05.89

11 Sri J. K. Dev, IAS 26.05.89 30.06.90

12 Sri A. B. Goswami 01.07.90 08.01.92

13 Sri D. N. Das (I/c.) 20.01.92 30.03.93

14 Sri J. Patnaik 31.03.93 31.01.94

15 Sri Janardan Dash 01.02.94 01.07.94

16 Sri Parag Gupta, IAS 01.07.94 12.04.95

17 Sri V. K. Saxena, IAS 12.04.95 17.06.96

18 Sri B. K. Roy, I/c. 17.06.96 01.09.96

19 Sri S. N. Tripathi, IAS 02.09.96 16.06.2000

20 Sri Sanjeev Chopra, IAS 16.06.2000 22.09.2004

21 Sri R. N. Dash, IAS 22.09.2004 01.10.2009

22 Sri T. K. Panda 01.10.2009 Continuing

THE MILESTONES OF THE BANK OVER LAST DECADES ARE

PRESENTED AS UNDER

The Odisha Co-operative societies Act 1951 was enforced and the rules were farmed

their under.

1955-56: M.T. Agriculture loan were advanced to farmer for the first times. The cadre

committee was constituted at the state level.

1956-57: Line of credit for Handlooms introduced and cases fund loans ceased to be

advanced. Banks exceeded Rs. 1 corer.

1957-58: Loan and advances of the Banks exceeded Rs. 1 crorers and stood at Rs. 1.18

corers at the end of 1957-58.

1959-60: Financing of Industrial Co-operative societies started.

1960-61: The first elected managing committee took over charge on 16.01.1961.

1964-65: Bank rate was raised from 4.5% to 6%. A new elected board of Management

took over charge on 14.12.1964.

1965-66: The banking Regulation Act, 1994 was made applicable to Co-operative banks

with effect from 01.03.1996.

1966-67: The balance sheet of the bank was drawn as per schedule-III of the B.R. Act,

1949.

1967-68: Crop plan system was introduced.

1970-71: The 1st branch of the bank was opened in Bhubaneswar on 15.12.1970.

1972-73: Bank working capital exceeded Rs.10 corer and stood as Rs. 12.39 corer at the

end of 1972-73.

1974-75: The loan and advances of bank exceeded Rs. 10 corers and stood at Rs.12.97

corers at the end of 1974-75. The bank sustained net loss of Rs. 8600/- during this year

in its history of 50 years services i.e from 1947-1948 to 1999-2000.

1975-76: Financing of ARDC commenced in the state under ST credit structure.1979-

80: The bank declared highest ever dividend of 6.5% during this year.

1981-82: Staff Service Rule of O.S.C.B staff farmed. The working of the bank exceeded

of Rs. 101.35 corers at the bank adopted Computer was installed in the bank.

1982-83: The bank earn highest ever profit in its history till 1982-1983. The profit was

Rs. 97.47 lakhs.

1985-86: The A.C.S.T.I of the bank was set up on 19.11.1985.

1990-91: New Co-operative year commenced from 01.04.1990. New scale of pay for

Bank staff adopted through Bi-partite agreement with effect from 01.01.90.

1991-92: O.S.C.B and 16 CCBs as a part of the exercise for organizational improvement

and financial strengthening finally aiming at attaining sustainable viability implemented

development action.

1994-95: Manu was signed between OSC bank, NABARD and Government of

Odisha on 11.07.94. NABARD formulated a scheme to reimburse 60% recurring

expenditure of the ACSTI from the year 1994-95. The ACSTI of O.S.C.B was the 1st

such institution of India to receive NABARB’s recognition and contribution.

1995-96: Bank succeeds in availing Government share capital contribution of Rs. 6.02

corers from the NRC (LTO) fund of NABARD during 1995-96 for Apex/CCBS and

PACS/LAMPS. It is an all time record achievement of the bank. MOU between OSCB,

DCCB and NABARD was signed on Dt. 06.08.95.

1996-97: Prudential norms on income recognition, asset classification and provisioning

there on were made on 01.04.1996. The Odisha mutual Arrangement Draft scheme was

introduced in CCBs under the aegis of the OSCB to facilitate easy transfer of funds

thereby increase the non fund business of Co-operative bank. The bank has been able to

achieve all the financial parameters set in the DAP for the year 1996-1997. The bank

started Total Branch Automation (TBA). The main branch was fully computerised and

online on 01.02.1998. NAFSCOB awarded the bank for outreaching the DAP

parameters.

The bank has instituted a study to identify reason for retarded growth in micro credit and

to suggest policy intervention to reverse the trend. Department of Economics of four

Universities of Odisha was entrusted with the job.

1998-99: In conformity with the budget speech of the Union Finance Minister, the bank

introduced Kissan Credit Card scheme from 1998 and took decision to finance the entire

SAO credit only through KCC. The4 bank conducted employee’s attitude survey

through a professional expert in the area of organisational behaviour. The bank actively

participated in the reconstruction of the Costal Odisha by advancing timely adequate

credit after divesting super cyclone.

1999-2000: Bank has entered in to MOU with CMC Ltd., a Government of India

enterprise for development of software for Total Bank Automation (TBA) of the

DCCBS and their branches.

2000-01: Kissan Credit Card scheme was further strengthened. The bank becomes third

in the country. All the branches and E.Cs were fully computerised. Automation of H.O

was taken up.

2001-02: ATMs were installed at Cuttack and Bhubaneswar. The Head Office of the

bank was fully computerised as such the OSCB become the first SCB in the country to

be fully automated.

The business hours branches and one E.C were extended up to 8.30 P.M and seven day

banking introduced in one branch and one E.C. Deposit mobilization fortnight observed

jointly with the DCCBs Rs. 119 corers were mobilized through joint Endeavour.

Customer attitude survey was taken up through instituted the B.C Hota memorial

lecture.

2002-03: Publication Bi-monthly journal. Outstanding loans and advances record a

growth of 11% during the year as against 10% in the last year. Anywhere Banking

Process has been started. Two extension counter (EC) have become the branches. Till

31.03.2003, 14,47449 have been issued and targeted 17,15000 as on 31.04.2004.

2003-04: Percentage of NPAs total assets has been reduced to 14.18% in comparison

with 16.51% during the year 2003-04.

Publicity through Electronic Media for Recovery and Deposit Mobilization introduced.

A special housing loan scheme has been introduced to provide hassle free credit to needy

Government / PSU employees for repair of their house. Odisha stood as 4 th in the

country in distribution of KCC next to Andhra Pradesh, Maharashtra and Rajasthan.

Kalinga Kissan Volunteers Vahinee scheme is under implementation in Balasore,

Koraput and Sambalpur CCBs on a pilot basis.

2005-06: Emphasis will be given on Micro Credit Mission shakti and step will be taken for doubling

the agricultural credit. The campaign “Co-operative at your step” will be made more vigorously. Top

priority will be given on the implementation of sound practices of corporate governance. The bank is

attaching considerable importance on implementation of the swarojgar Credit Card Scheme launched

by the Union Government. The bank has adapted Fair Lending Practice Code to achieve

synchronization of best practice while dealing with the customer. It has been envisaged to computerize

all the DCCB along with their branches.

Promotional and Development Role

As The Apex Bank of the Coop Credit Structure, the bank has assumed the

role of leadership to develop the structure to face the emerging challenge in

banking business. The Following activities have been taken by the bank in

these regards.

Introduction of Kisan Credit Card: -

The OSCB has been facilitated dispensation of entire farm credit through Kisan

Credit Card only to enable the farmer members to get instant credit.

The DCCBs with the help of the Bank have transformed 813 primary societies

as Mini Banks who have mobilized Rs. 250 crores from the rural areas

1. Information Technology in DCCBs: - The OSCB has taken the

responsibility to computerize the operation of the DCCBs to face the

challenge from their commercial counterparts. The software package is

finalized for the purpose.

2. Face lift of the branches of DCCBs and the Mini Bank: - The Bank has

been providing regular assistance for the face-lift of the DCCB

Branches and PACS. The NABARD has also helped 200 PACS with

financial assistance for improvement of infrastructure facilities.

3. Organization and linkage of self-help Groups:-The Banks has been

patronizing and close monitoring organization of self help groups at

primary level and monitoring the progress.

4. Human Resources Development: - The OSCB has been maintaining a

Training Institute to impart training to the personnel of DCCBs and

PACS/ LAMPS/FSS. Regular Training programs are conducted by the

institute for the purpose.

5. Conduct of Study:- To find out the reasons for low off- take of farm

Credit, the bank had appointed all four Universities of the states. They

have given their reports basing on which corrective actions have been

taken. The bank has also undertaken a study on functioning of SHGs in

West Bengal to emulate their experience in the state.

6. Preparation of development Action Plan and Signing of MOU:-

At the behest of OSCB, the DCCBs have been preparing DAPs and

Signing MOU with the Bank and NABARD. This effort of the banks

has created a cost consciousness among the lowest tiers and their

turnover has increased manifold.

7. Image Building: The Bank has been undertaking advertisement through

hoarding and electronics media to boost up the images of the entire

credit structure.

8. NABARD as partner of the Bank: - The NABARD has been extending

required support to the Bank to accomplish its objectives.

The assistance include liberal and confessional refinance, assistance

from Coop Development Fund, Support to the women Development

cell, Technical, monitoring and Evaluation Cell, Faculty support to the

Training Institute Etc.

9. Excellence Recognized: - The National Federation of state Coop Banks

(NAFSCOB) has awarded the Bank for its outstanding performance for

consecutive four years. The NABARD has also awarded the bank for its

performance during 1997-98. The Bank has been achieving all the

MOU Parameters.

10.Profits since Inception: - The Bank has been earning profit since its

inception and paying divided to its shareholders uninterruptedly.

Corporate Vision: - The Bank aims at a vibrant Coop. Credit Structure by

strengthening PACS and DCCBs, best customer services through

computerization and anytime-anywhere Banking and above all a satisfied

clientele.

OSCB Ltd. Network

Angul United CCB

Aska CCB

Balasore Bhadrak CCB

Banki CCB

Berahampur CCB

Bhawanipatana CCB

Bolangir DCCB

Boudh CCB

Cuttack CCB

Keonjhar CCB

Khurda CCB

Koraput CCB

Mayurbhanj CCB

Nayagarh CCB

Sambalpur DCCB

Sundaragarh CCB

United Puri Nimapara CCB

http://www.oscb.coop/network/Anugulnew.asp

http://www.oscb.coop/network/puri.asp

http://www.oscb.coop/network/sundergarh.asp

http://www.oscb.coop/network/sambalpur.asp

http://www.oscb.coop/network/Nayagarh.asp

http://www.oscb.coop/network/mayurbhanj.asp

http://www.oscb.coop/network/koraput.asp

http://www.oscb.coop/network/khurda.asp

http://www.oscb.coop/network/Keonjhar.asp

http://www.oscb.coop/network/cuttacknew.asp

http://www.oscb.coop/network/Boudh.asp

http://www.oscb.coop/network/bolangir.asp

http://www.oscb.coop/network/Bhabanipatana.asp

http://www.oscb.coop/network/oscbnetwork.asp

http://www.oscb.coop/network/Banki.asp

http://www.dccb-balasore.com/

http://www.oscb.coop/network/aska.asp

Short Term Credit Co-operative Banking Sector

Financial Highlights of Orissa State Co-operative Bank Ltd.

The Orissa State Co-operative Bank has made strides in many key areas and achieved all

targets setup in the Development Action Plan (DAP). The funds comprising of paid of

capital and resource, deposit and borrowing are the main resource of the bank. A Major

chunk of these resources are deployed under the loans and advances to the affiliated

central Cooperative Banks, Member society and individuals for different purpose under

farm and non-farm sectors.

The Statutory investment requirement under RBI Act and BR Act are met by investment

in Central/State Governance Securities and others approved trustee securities, seasonal

investible surpluses are deployed in call and short term deposits with commercial banks,

to maximize as yield on assets.

Besides remaining vigilant over judicious deployment of funds, the banks is also making

concerted efforts to bring down the level of non earning assets of the banks and increase

the financial margin.

Seasonal investible surplus are deployed in call and short terms deposits with

commercial banks and DFHI etc. to maximise the yields on assets. Besides remaining

vigilant over judicious deployment of funds, the bank is also making concerted efforts to

bring down the level of non-earning assets of the bank and increase the financial margin.

The Bank since its inception operated above the breakeven level and attained sustainable

viability long since.

As a result the bank continued to build up its Reserves and Funds as per the provision of

the bye-laws. The total Reserves at the end of 2010-2011 stood at Rs.5752.52 Lakhs as

against Rs.4711.00 Lakhs in 2011-12 .Quantum wise, the reserves increased by

Rs.1041.52 Lakhs during the year, recording growth rate of 22.11 %.

Retail Banking of Orissa State Co-operative Bank Ltd.:

Housing loans: The bank is financing Housing Loan under its "APNA GHAR”

scheme. Maximum amount under this head is Rs.500000.00 for purchase of readymade

house or construction. For repair, renovation or addition/ alteration the limit is

Rs.50000.00. The rate of interest is 13% on reducing balance. Maximum repayment

period is 15 years with 18 months moritorium period.

Consumer Durable Requirement / Formalities

1. Maximum limit Rs. 50000.00 or 75% of the cost of the item.

2. Subject to five times monthly gross income.

3. Repayable in maximum 40 monthly instalments in reducing balance.

Motor Vehicle Finance

For any sort of Surface Transport and Water Transport vehicle both for commercial and

personal purpose OSCB provides motor vehicle Finance.

Requirement / Formalities

1. 75% of the total cost of vehicle, including insurance and registration.

2. Repayable in 60 monthly instalments reducing balance.

Business Enterprise

Terms Loan for

1. Fixed Assets for Projects.

2. Commercial Complex and Kalyan Mandap .

3. Hotels, Tourist Resorts, Health Care units.

4. Equipment and Machineries.


1. Maximum 75% of the fixed Assets

2. Maximum repayable periods – 10 years.

3. Interest in reduced balance method.

Working Capital Loans

1. Retail Business

2. Trader

3. Wholesaler

4. Project Solution


1. Maximum 75% of working capital requirement subject to Stock Holding.

2. Quarterly Interest on days balance.

Introduction of Corporate Governance by Orissa State Co-

operative Bank Ltd.:

Orissa State Cooperative Bank is the first bank in the cooperative sector in the country to

introduce sound practices of corporate governance to ensure transparency in its

functioning. During the last three years, the following initiatives have been taken to

follow good corporate practices by addressing a range of issues such as, protection of

shareholders rights, enhancing shareholders value, disclosure requirements, integrity of

accounting practices and strengthening the control system.

The employees of the bank can now expose any wrongdoing of the top management

without any fear of reprisal. The Board of Management of the bank in its meeting held

on 30.06.2003 has accepted the system for protection of whistleblowers adopted in USA

and in Indian Companies like Wipro and Infosys. This facility would give protection to

the staff, who expose irregularities, corruption, mal-practices etc. by the top

management of the bank. Under this system, where any staffs of the bank discovers

information, which he believes shows serious mal-practice, impropriety, abuse or

wrongdoing, then the information should be disclosed without fear of reprisal. Following

the spirit of the Sarbanes Oxley Act of the USA, which envisages protection for

whistleblowers (staff that expose corruption), a similar policy has been adopted to

enable the employees to raise concern about any irregularity and impropriety at an early

stage and in the right way without fear of victimisation, subsequent discrimination or

disadvantage. OSCB has become the first bank in the country to have adopted such a

policy. Employees are normally the first to realise that there are irregular or illegal

practices being followed by any colleague/ management. Hence a policy which affords

protection to the employees who expose irregularities, corruption, malpractice etc. will

go a long way in ensuring transparent management, setting standards, which the DCCBs

shall be encouraged to emulate.

Besides, the Orissa State Cooperative Bank has adopted the following sound practices of

corporate governance.

1. Timely audit of accounts has been ensured. The audit for the year 2005-06 was

completed by 30.06.06.

2. The bank has been paying uninterrupted dividend to the shareholders.

3. Common coding of accounting heads has been introduced in the State to integrate the

accounting practices of the OSCB and all affiliated DCCBs. This has facilitated the

computerisation process in the Central Cooperative Banks.

4. Organisation of annual customer meets to understand their changed perception and to

reorient the policies and procedures of the bank. Such meets are also being organised

at the level of the DCCBs as well as the PACS.

5. A transparent transfer policy have been formulated and adopted in the bank.

Transfers are now being affected on the basis of the policy without any other

consideration.

6. A bi-monthly house journal entitled “Sampark” is published with effect from

January, 2001, which not only provides a forum to the employees to express their

views, but also the management is also able to explain the justification for taking

important decisions.

7. Each branch of the OSCB, DCCBs as well as the PACS is being visited by a

supervisory officer every month to inspect the functioning and also impart guidance.

8. Loans Manual for the Bank has been prepared by NABCON- the consultancy arm of

NABARD.

9. Systems Audit of the Bank has been conducted by M/s Haribhakti & Co., Mumbai.

10.A comprehensive HRD policy is being evolved for the Bank by the National Institute

of Bank Management, Pune.

CHAPTER-3

LITERATURE REVIEW

REVIEW OF LITERATURE

Financial and Economic Meaning of Investment, Investment is the allocation of

monetary resources to assets that expected to yield some gain or positive return over a

given period of time. These assets range from safety investment to risky investments.

Investments in this form are also called ‘Financial Investments’. To the economists,

‘Investment’ means the net additions to the economy’s capital stock which consists of

goods and services that are used in the production of other goods and services. In this

context the term investment implies the information of new and productive capital in the

form of new construction, new producers’ durable equipment such as plant and

equipment. Inventories and human capital are included in the economist’s definition of

investmenInvestment is the employment of funds with the aim of achieving additional

income or growth in value. The essential quality of income is that, it involves ‘waiting

‘for a reward. It involves the commitment of resources which have been saved or put

away from current consumption in the hope that some benefits will occur in future. The

term ‘investment’ does not appear to be a simple as it has been defined. Investment has

been categorized by financial experts and economists. It has also often been confused

with the term speculation.Tangibility Intangible securities have many times lost their

values due to price level inflation, confiscatory laws or social collapse.

Some investor prefers to keep a part of their wealth invested in tangible properties like

building, machinery and land. It may, however, be considered that tangible property

does not yield an income apart from direct satisfaction of possession or property.

Legality and freedom from care All investments should be approved by law. Law

relating to minors, estates, trusts, shares and insurance be studied will bring out many

problems for the investor. One way of being free from care is to invest in securities like

Unit Trust of India, Life Insurance Corporation or Saving Certificates. The management

of securities is then left to the care of the Trust who diversifies the investments

according to safety, stability and liquidity with the consideration of their investment

policy.

The identity of legal securities and investments in such securities also help the investor

in avoiding many problems. Appreciation and purchasing power stability Investors

should balance their portfolios to fight against any purchasing power stability. Investors

should judge price level inflation, explore their possibility of gain and loss in the

investments available to them, limitations of personal and family considerations. The

investor should also try and forecast which securities will possibly appreciate. A

purchase of property at the right time will lead to appreciation in time. Growth stock will

also appreciate over time. These, however, should be done thoughtfully and not in a

manner of speculation. Income stability Regularity of income at a consistent rate is

necessary in any investment pattern.

Not only stability, it is also important to see that income is adequate after taxes. It is

possible to find out some good securities, which pay particularly all their earnings in

dividends.

. CMS (Cash Management Services)-: In today competitive market place, effectively

managing Cash flow can make difference between success and failure. Co-operative

bank offers a wide range of collection and payment services to meet your complex case

management needs. Payment received from your buyers made to your suppliers are

efficiently processed to optimise your case flow.

Position and to ensure the effectives management to your suppliers of your business

‘operating funds. The flow of receivables and payables can also be seen through our web

solution above all our quick adaptation of the latest technology differentiates us from the

other competing banks.

Co -operative bank present payment solutions. Save on effort, time and worry. Plus our

electronic clearing services help serve you even better.

With our collections services you can collect regular and recurring payments from your

customers more efficiency .our centralised CMS solutions enables quick access to your

company funds with matching MIS/reports through emails web solutions. These deposit

are directly credited to a designated account regardless of where they are made.

CMS ADVANTAGES

Online web CMS collections

Online web CMS payments

Extensive network

Lower interest costs &improved liquidity

Centralised services desk

Advantages of web CMS

Comprehensive MIS

Mobile alert services

RTGS (REAL TIME GROSS

SETTLEMENT)

“RTGS are a funds transfer mechanism where

transfer Of money take place from one bank to another on real on gross basis settlement

in real time means payment transient is not subjected to any waiting period the transfer

are settled as soon as they are processed gross settlement means the transfer is settled on

one to the basis without bunching with any other transfer payment are final and

irrevocable.

CASH-: Cash in bank means deposition of cash on the cash counter and payment made

to the customer on the cash counter. Every bank branch has a cash retention limit which

mean the amount if cash is can keep in the branch. High value cash deposit of 10 lakh

and above are two monitors by the bank and payment. 50 thousand above deposit in an

a\c in a day require pan no. or form 60.

A) Cash In hand which includes notes and coins.

B) Current a/c with schedules and non-schedules bank (demand deposit )

earning no – interest

C) Deposit account with bank (time deposit) earning interest.

“Cash is liquid assets or liquid resources owned by a firm which enable it to purchase

goods or services”

CLEARNING-:

Clearing: - Is a method of funds settlement between banks.

Clearing Inward: - It means cheque of a bank which is presented by other banks to it

for payment purchase.

Clearing outward: - It means cheque which our bank presents to other banks for

payment to our customers.

CASH CREDIT LIMIT-: Cash credit is a facility given by the bank there highly

reputed customer like as over draft and to other customer on their mortgage of any

assets. in this facility customer can withdraw from his account up to maximum of his

limit and deposit money when he have interest on this facility will be charged on daily

debit balance method.

AGRICULTURE LONS-: Which loan given to existing or prospected formers for

there need of finance for purchase of agriculture, land, equipment’s, and maintaining and

operating of agriculture activities.

CHAPTER-4

COMPARATIVE DATA ANALYSIS OF

BANKING PRODUCTS

1. COMPARISON OF CURRENT ACCOUNT

2. COMPARISION OF SAVING ACCOUNT

3. COMPARISION OF BANKING FACILITIES

4. COMPARISON OF LOAN

COMPARATIVE DATA ANALYSIS OF BANKING PRODUCTS

Data collection:

During my data collection, data was collected:-

• From Banks

• From Banks Website

Four Banks were selected SBI, SBBJ, BOB, and HDFC

LIST OF COMPETITORS

• BOB

• SBI

• SBBJ

• HDFC BANK

• IDBI

• AXIS BANK

• ICICI BANK

• PNB

COMPARISION OF SAVING ACCOUNT

OSCB COMPETIVE BANK

Single type of saving a/c

Low opening charge

Various Banking facilities

like ATM, FD Sweep,

Accidental coverage are not

available

Various type of saving a/c

like Silver, Saving plus,

Super saving a/c, High

opening charge

Various Banking facilities

like ATM, FD Sweep,

Accidental coverage are

available

COMPARISON OF CURRENT ACCOUNT

OSCB COMPETIVE BANK

Low opening charge-

3000

Only local cheque book

are given

Stop payment charges

High opening charge

-10000

Local cheque book &

multi-city cheque

book are given

applicable Have stop payment

charges but it’s free

for Net Banking

COMPARISON OF LOAN

OSCB COMPETIVE BANK

• Low limit of Loan

amount for e.g.

Personal loan 1

lack or 8 times of

monthly salary

• High limit of loan amount for e.g.

Personal loan

SBI Bank- 12 time of monthly income

SBBJ Bank- 18 time of monthly

Income

HDFC Bank- Rs.15,00,000 for any

purpose

• Low interest Rate then any other bank

generally it is 0.50 or 1 % approx.

low

• In some loan low processing fees

like

Home loan Rs.100(fixed)

Mortgage Loan 0.50% of loan amount

• High interest rate

SBI - 13.25%

HDFC Bank- 14%

BOB -13.25%

• In some loan high processing fees

comparison RSCB bank

Sample size was 150.

Q.1 Do you have any bank account?

a) YES b) NO

Yes No Total

No. of Respondents 110 40 150

% of Respondents 73 27 100

Q.2 In which bank do you maintain your bank account?

a) OSCB b) SBI C) SBH d) ICICI

RSCB SBI SBH ICICI

Total

No. of Respondents 50 35 45 20

150

% of Respondents 33 24 30 13

100

Q.3 which type of account (s) you hold?

a) Saving a/c b) Current a/c

c) Fixed Deposit a/c d) Regular Deposit a/c

Saving Current F.D. R.D. Total

No. of Respondents 50 65 20 15 150

% of Respondents 33 44 13 10 100

Q.4 What all benefits and services are you getting from your bank?

a) Net Banking b) Super Saver a/c

c) 24-hours ATM d) Demet service

(Net Banking) (Super Saver a/c) (24-hoursATM) (Demet

service) Total


150


100

Q5. Are you satisfied with the services of your bank?

a) YES b) NO

Yes No Total



Q.6 Do you want to switch your bank to the new one?

a) YES b) NO

Yes No Total



Q.7 what more facilities/services do you expect from a bank?

a) Net banking b) Super saver a/c

c) 24-hours ATM d) Demat services

(Net banking) (Super Saver a/c) (24-hoursATM) (Demat

services) Total


150


100

Q.8 Do you favor the implementation of the computerization and core

banking solution?

a) YES b) NO

Yes No Total



INTERPRETATION & ANALYSIS

It was found that the banks with most ATMs have gained priorities in the minds

of the customers.

Different bank have different schemes for different age groups. Some banks are

giving privilege to senior citizens, while others to child group etc. But RSCB

have not any such schemes targeted to different age group.

The study has shown that the customers want better branch network so that they

can operate their account from different city also.

The study has shown that since different bank are providing different facilities to

different type of retail banking products so in lieu of better facilities customer

have different account in different banks.

The study has shown that many people don’t want to open account in Rajasthan

State Cooperative bank because they think that the services like ATMs, Phone-

banking, internet banking etc. not provided by these banks.

The study has shown that there is a growing concern among the customers about

the attitude of bank employees towards them.

Due to limitation of time very few customers could be contacted. For any study

to be practically meaningful, these number need to be significantly higher.

The environment available for filling the questionnaire or attending the

interview is not very conducive for serious interaction and some of the

responses may be casual, thus affecting the final analysis.

In any detail study, it is possible to add many other variables.

The sample size was not large enough and may not be representative of the

whole population.

The scope of study was limited to only certain product categories and cannot

be generalized to all the product categories.

CHAPTER-5

RECOMMENDATIONS

&

SUGGESTIONS

RECOMMENDATIONS & SUGGESTIONS

Advertising is not appropriate, as many people are not aware of Rajasthan State

Cooperative Bank. Therefore Hoarding and Boards should be displayed at

various prime locations in the city.

Timely payment of salary and Promotion of employees will boost their morale.

All the complaints of Customer should be deal in proper manner because it is the

customer who will give good or bad mouth about bank services.

Non maintenance & other charges which are very high as compared to other

Banks should be reduced.

Existing customer should always be informed about the new product.

Regular connected with customer.

Problem faced by account manager during opening the account should be

forwarded to deputy manager by branch manager. This will help to sort out all

the problems.

Proper training of Bank staff to give impressive presentation.

Proper Co ordination between Marketing and Operation need to be developed.

Promotion of various scheme by Rajasthan State Cooperative Bank.

CHAPTER-6

CONCLUSION

.CONCLUSION

The bank should therefore look forward to promote investment

opportunities during their visit through banners, leaflets and pamphlets,

etc. and increase the awareness levels.

The company must take strong steps in promoting the investment option

and generates desire and interest towards the products. A complete new

market strategy needs to be formulated.

Most of the customers were inclined to invest in insurance schemes in

which they showed preference for automobile insurance. Firstly, the

corporation should target the existing customer base investment plan and

try to increase their awareness levels. Then they should make the other

customers of the bank at least aware of the various schemes so that the

next stage of interest, desire and action becomes easy to execute.

It was surprising to note that some of the respondents having account in

co-operative Bank had investment in nearest rival HDFC. Corporation

should take stern steps to channelize the investment towards itself. The

corporation should also work on the factors, which lead to investment in

other banks.

Location and loyalty towards the old banks were the key factors for this

particular behaviour. The corporation therefore should give a serious

thought to these aspects and try to provide service, which can somehow

make a dent in the loyalty and more trust towards the state owned banks.

Bank should look to open new branches with proper planning and careful

selection of the location, which is convenient to the target customers

especially in places where there are a lot of option in front of the

consumers.

Advertisement play an important part in the brand recall of the corporation

therefore, bank should look to create a campaign, which provides the

consumers with the basic knowledge and general attraction towards the

products offered.

Co-operative Bank should look to tap the untapped market and increase

their market share. It is very surprising that in spite of the high satisfaction

levels of the current customer base the market share of the bank is stagnant.

This shows a lack of hard-core brand loyal customers. Efforts should be

made to lead the consumers to this level of loyalty so that more strong

work-of-mouth should be there.

APPENDIX

BIBLIOGRAPHY

Kotler, Philips, Marketing Management.

C.R.Kohari,” Research methodology”.

Schiffman L.G and Kanuk L.L,” Consumer Behaviour”.

Tull Donald and Hawkins Dell.” Marketing Research”.

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