1.0).

Introduction The Regional Rural Banks (RRBs) have special place in the multi agency approach adopted to provide agricultural and rural credit in India. These banks are state sponsored, regionally based and rural oriented. As enshrined in the preamble to the RRBs Act 1976, the RRBs were established with a view to developing the rural economy by providing, for the purpose of development of agriculture, trade, commerce, industry and other productive activities in the rural areas, credit and other facilities, particularly to small and marginal formers, agricultural laborers, artisans and small entrepreneurs and for matters connected therewith and incidental thereto. The RRBs were treated as scheduled banks right from their inception and functioned alongside the larger commercial banks and the Cooperative banks. Over a period of time, they have developed an impressive branch net work in the rural sector. During three decades of their existence, the RRBs have passed through several phases. However, with their focus of operations mainly in the rural areas, the RRBs have always been in an ideal position to provide financial services to the rural population. It was in the year 2004 that the Government of India, based on recommendations of the committee on flow of credit to agriculture and related activities from the Banking system (headed by prof. V S Vyas) decided to consolidate the RRBs into State level entities within the same Sponsor bank. The amalgamation process which began in September 2005, gained momentum in the subsequent period, bringing down the total number of RRBs to 88 as at the end of May 2008, out of which 42 were stand alone RRBs,45 were amalgamated RRBs and 1 RRB was newly set up in the union territory of Pondicherry. 1.1). Poverty Poor people live without fundamental freedoms of action and choice that the better-off take for granted. They often lack adequate food and shelter, education and health, deprivations that keep them from leading the kind of life that everyone values. They also face extreme vulnerability to ill-health, economic dislocation and natural disasters. They are often exposed to

ill treatment by institutions of the state and society and are powerless to influence key decisions affecting their lives. These are all dimensions of poverty. In almost all underdeveloped countries where per capita income is very low, income inequality has resulted in a number of evils, of which poverty is certainly the most serious one. In India, even now in spite of all the development during the past five decades, nearly forty per cent of the population is poor and for most of the time suffers from extreme destitution. No one says that equitable distribution of present income in India will make everyone rich, but there must not be any doubt about the fact that it will ensure the required minimum consumption to all. In a world where political power is unequally distributed and often sneers the distribution of economic power, the way state institutions operate may be particularly unfavourable to poor people. For example, poor people frequently do not receive the benefits of public investments in education and health. And they are often the victims of corruption and arbitrariness on the part of the state. Poverty outcomes are also greatly affected by social norms, values, and customary practices that, within the family the community, or the market, lead to exclusion of women, ethnic and racial groups, or the socially disadvantaged. That is why facilitating the empowerment of poor people by making state and social institutions more responsive to them-is also key to reducing poverty. Vulnerability to external and largely uncontrollable events-illness, violence, economic shocks, bad weather, natural disasters-reinforces poor peoples sense of ill-being, increases their material poverty, and weakens their bargaining position. That is why enhancing security by reducing the risk of such events as wars, disease, economic crises, and natural disasters-is key to reducing poverty. The world has deep poverty amid plenty. Of the worlds 6 billion people, 2.8 billionalmost half- live on less than $-2 a day, and 1.2 billion-a fifth- live on less than $-1 a day, with 44 per cent are living in South Asia. In rich countries less than 1 child in 100 does not reach its fifth birthday, while in the poorest countries as many as a fifth of children do not. One of every three persons in India is officially poor, and two of three are undernourished or malnourished. If we count those who are deprived of safe drinking water, adequate clothing, or shelter, the number is considerably higher. Finally, if we also include people who are above the officially defined poverty line, but one vulnerable, in the sense of not being adequately insured against rising prices, unemployment, illiteracy, declining incomes, old age, and disease,

we get a huge majority. A recent Human Development Report ranked Indias development index at 138 out of 175 countries. A World Bank report predicts that most of the worlds poor will reside in South Asia by 2020. A comprehensive analysis of the determinants and causes of poverty, its evolution, its short-term alleviation and long term eradication strategies, and discussion of the related issue of what constitutes development and well-being, and how it should be measured. It is important to examine the impact of these improving terms of trade (through higher agricultural prices) on the poor. 1.2). Definition of Poverty Poverty is a complex phenomenon, which cannot be subsumed under a single definition, applicable to all societies and all contexts. It has to be defined in relation to be average living standards in a society and the social reforms and customs acceptable to it at that point of time (Atjkinson 1975:1986). The very mention of poverty actually conjures up images of destitution, hunger, homelessness, or to put it simply to a general deprivation. Poverty is a phenomenon which is world-wide and its incidence differs from society to society. However, it is largely seen in developing nations, in fact, the world is dichotomized into South and North which represent poor and rich countries respectively. A caution needs to be taken here as each country or region has its standards of measurement teardowns defining poverty. Poverty is in fact a relative concept whereby people are regarded as poor if they suffer from relative deprivation, i.e., if they do not have access to the diets, comforts and the standard of living which are customary in their society (Atkinson 1975). Given the complexity of this concept it would be of significance to list out the various definitions of poverty. Rouwfree was the first in Britain to discuss in detail the problem involved in defining poverty and clearly saw his approach as being based on absolute line. According to him, a family was considered to be living in poverty if its total earnings were insufficient to obtain the minimum necessities for the maintenance of merely physical requirements (Pulley 1989). The shorter concise English Dictionary (1993) describes poverty as the state of being poor; want of necessities to life. This means having little or no wealth or material possession, indigence and destitution want in various degrees.

Peter Townsend observes that people are deprived of conditions of life which ordinarily define membership of society and that if they lack or denied resources to obtain access to these conditions of life and thereby full membership of society, they are in poverty (1970:76-81). Ahluwalia (1978) observes poverty as a complete assessment of trends in rural poverty that should take into account several dimensions of poverty, of which income or consumption level per head is only one equally relevant and factors such as longevity, access to health and education facilities, and perhaps also security of consumption levels from extreme shocks. Kurien (1978) views poverty as the socio-economic phenomenon whereby the resources available to a society are used to satisfy the wants of few while many do not have even their basic needs met. These definitions would perhaps provide an inking as to the conceptual difficulties faced while defining poverty. As stated earlier, poverty is not a concept, which can be defined within a single parameter, as it is not the question of mere hunger or homelessness, alone which would go into the definitions of poverty. In fact poverty is linked to the whole of other factors and it forms a link with other constraints, which govern our system. The presence of poverty does not just refer to the particular political, social or economic system, but in fact, it is closely linked to the system as a whole. Therefore, the study of poverty requires a historic approach. 1.3). CAUSES OF PROVERTY The causes of poverty may be varied and multiple. It would be presumptuous to assume that poverty can be attributed to a single cause. The causes of poverty can range from political, social to economic. The causes of poverty may vary from region to region, society to society or from nation t nation. Some of the general causes of poverty are:1) The people are poor because they prefer it that way. 2) Low productivity per unit of Labor. 3) The country is naturally poor. This seems the obvious answer where the soil is sparse and unwanted, the forests thin and the subsoil barren. 4) Inequitable distribution of infrastructure including different means of production. 5) Inception of new agricultural strategy has benefited only selected rich farmer community.

6) The country is poor because it has been kept in a state of colonial oppression. The British, French and Dutch were in business not for their subject people but for themselves. The people are still paying for these centuries of indifference, exploitation and neglect. 7) Failure to implement land reforms. 8) Poverty is the consequence of class exploitation. The counter part of the poverty of the many is the opulence of the few. The second is the cause of the first. 9) Under utilization of natural resources. 10) Inequalities in land ownership and concentration of tangible wealth in few pockets. 11) Unfavorable credit policy. 12) Poverty is caused by insufficient capital. Low income allows of no saving without saving, there is nothing to invest. 13) Over-population is the cause of poverty. 14) Poverty is caused by incompetent economic policy. Poverty is caused by ignorance. It is plausible axiom that no literate population in the world is really poor and no illiterate population is otherwise. 1.4). Poverty alleviation programmes India has a very long history of experimenting with various approaches to rural development. Even in the pre-independence era, a number of rural reconstruction experiments were initiated by nationalist thinkers and social reformers. Well known among were the Gurgaon Experiment of F.L.Brayne(1920), the Marthanndam experiment of Spencer Hatch(1921), the Sriniketan experiments of Ravindranath Tagore(1020s), the Swegram experiment of Mahatma Gandhi (1933), the Firka Development Scheme(1946) and Etawali pilot Project of Albert Mayer (1948) (Singh 1986). After independence came the Grow More Food campaign, the review of which resulted in the National Community Development Programme. Two basic premises were fundamental in the decision to create such a programme in 1952 (Ensminger 1983.3)

1. The overall development of the rural community can be brought about only with the

effective participation of the people backed by the co-ordination of technical and other services necessary for securing the best from such initiative and self help. 2. The problems of rural development have to be viewed from a historic perspective and the efforts to solve them have to be multi-faced. The central objective of the Community Development programme is to secure the total development of the material human resources of rural areas and to develop local leadership and self-governing institutions. The basic idea is to raise the levels of living of rural people through a number of programmes. This objective was to be attained by bringing about a rapid increase in food and agricultural production by strengthening programmes of resource development. Such as minor irrigation and soil conversation by improving the effectiveness of farm inputs, supply systems and by providing agriculture extension service to the farmers. The Community Development programme (CDP) was formerly incorporated on October 2, 1952. It was extended to be the first step in a programme of intensive development which was expected over a period of time to cover the entire country. Initially, it was launched in the fiftyfive project area located in different parts of the country. Another 110 areas had to be necessarily added to the original fifty-five in the course of six months. Demands for the expansion of Community Developmental Programme from members in the State Legislatures and from members of parliament continued to sky-rocket. It was difficult to resist the mounting political pressure to expand the programme. Originally, each of the fifty-five projects was to embrace approximately 300 villages with a population of about 2,00,000 people and cover a cultivated area of approximately 1,50,000 acres. But the Community Development programme, now covers all the rural areas in the country. The other Poverty Alleviation Programmes are: i). INTENSIVE AGRICULTURE DISTRICT PROGRAMME The Intensive Agricultural District Programme(IADP), popularly known as the package programme, represents a significant departure in approach from the Community Development

Programme (CDP), in that it employed the concentration principle in developing resources as opposed to the equity criterion used in CDP. Its basic premise was that India needed to organize its agriculture production with enough resources to make it effective. The programme began in response to the food crisis in 1957-58. The Government of India initiated an agricultural production team from the USA in January 1959, to study the countrys food production problems to make recommendations for a coordinated effort to increase agriculture production on an emergency basis. The team suggested a 10 point programme to increase food production (Government of India 1963). As its immediate goal, the IADP sought to achieve rapid increase in agricultural production through a concentration of financial, technical and administrative resources. Its aim, in the long run, was to achieve a self generating breakthrough in productivity and raise the production potential by stimulating the human and physical resources of change. The State Governments selected seven districts for the implementation of the IADP Thanjavaur (Tamilnadu), West Godavari (A.P), Shahabad (Bihar),Raipur (M.P), Aligarh (U.P),ludiana (Panjab) and Pali (Rajasthan). The Government of India approved the implementation of the programme in seven districts in June 1980 and suggested that the schemes be implemented in one district in each of the fifteen states of the country. The seven districts were delimited into 140 community development blocks with 14,038 villages and a total grass cropped area of about 45 lakh hectares. ii).SPECIAL GROUP AND AREA SPECIFIC PROGRAMME The failure of the growth oriented strategy of the sixties to make any significance on the problems of rural poverty and unemployment led to its re-examination in the late sixties. Inequitable distribution of the benefits of the growth-oriented programmes between prosperous and backward areas and between rich and poor households within an area was officially acknowledged and corrective measures in the form of group specific and area specific programmes were initiated in the early seventies. While the growth rate of agricultural production was still not satisfactory, distribution was not to wait any longer; the faith in the trickledown theory had been completely eroded.

iii). SMALL FARMER DEVELOPMENT AGENCY (SFDA) The report of the all India Rural Credit Review Committtee (1969) recommended the establishment of an agency to assist the small farmers who had not benefited from the gains of the Green Revolution. Accordingly, the Fourth Plan laid special emphasis in enabling the share in its benefits. To achieve this objective the plan provided for the initiation of a project, namely the Small Farmer Development Agency Scheme. The SFDA scheme was sanctioned during 1970-71 but the actual implementation started only during 1971-72. The objective of the SFDA was to ensure the availability of the small farmers. An Autonomous Agency, registered under the Registration of Societies Act 1860, was established at the district level to implement the SFDA project. It acted as a catalyst in identifying small farmers, investigating their problems and helping them to obtain inputs from various development organizations. iv). MARGINAL FARMERS AND AGRICULTURAL LABOURS (MFAL) SCHEME The MFAL was launched in 1970-71 following the recommendation of the All India Rural Credit Review Committee (1969). Its objective was to assist the marginal farmers (with land holding below 2.5 acres) and agricultural labourers to improve their productivity and income through a variety of activities like crop husbandry including multiple cropping, increased use of new inputs, water harvesting techniques, mirror irrigation, livestock, poultry and fisher period, 15,000 marginal farmers and 5,000 agricultural labourers- those defined as owning a homestead and deriving more than 50 per cent of their family income from agricultural wages. v). DROUGHT-PRONE AREA PROGRAMME (DRAP) The rural Works Programme was initiated in 1970-71 with the focus on the execution of rural works and employment generation is an attempt to mitigate the condition of scarcity in drought-prone acres. It was introduced in the year 1975 to combat frequent recurrence of drought. Matching share of 50-50 between Central and State. The programme was sought to be reoriented on the basis of an area development approach and was redesigned as the Droughtprone Area Programme at time of midterm appraisal of the Fourth Five Year Plan.

The program is in operation in seventy four districts spread over thirteen states which were identified as prone to drought on the basis of objective criteria such as low exent of irrigated area, low and erratic distribution of rainfall and high periodicity of drought. The basic objectives of the Programme are: 1) To reduce the severity of the impact of drought.
2) Stabilizing the income of the people particularly weaker sections of the society and

3) Restoration of ecological balance. The other notable programmes are the Desert Development Programme (DDP), Hill Areas Development Programme (HADP), Tribal Areas Development Programme (TADP). Integrated Wasteland Development Programme (IWDP):- It was introduced in 1991 with 100 per cent Central assistance to check the soil erosion and marginalization of lands. vi). NATIONAL RURAL EMPLOYMENT PROGRAMME (NREP) To eradicate the problem of rural employment and under employment, what is required is a multi-pronged strategy which should aim on the one hand, at resource development of vulnerable section of the population, and on the other, should provide supplementary employment opportunities to the rural poor, particularly during lean periods, in a manner which can, at the same time, contribute directly to the creation of durable assets for the community. In 1960-61, 36 Rural Works Projects were launched all over the country. It was envisaged that annual employment of 100 days would be created for 1,00,000 persons in the first year using a total of 25 lakh persons in the final year of the Third Plan. The project to be undertaken included irrigation, road construction, village housing and soil conversation. Essentially, the projects were meant to be labour intensive with a minimum expenditure on materials and machinery. The exact nature of each project was to be determined by the requirements of the particular area. The execution of projects was to be determined by the requirements of the particular area. The execution of projects was to be concentrated in the slck periods when normal agricultural operation offered little opportunities for employment. The wages were in no case to exceed the rate prevailing in the area, so as to ensure that no one who had other employment was attracted to rural works (Government of India 1961-77). The major programmes of the series were the Crash Scheme of Rural Employment Project (CSRE), Pilot Intensive Rural Employment Project (PIREP), Employment Guarantee

Scheme (EGS),Food For Work Programme (FFWP), National Rural Employment Programme (NREP), Rural Landless Employment Guarantee Programme (RLEGP). The NREP was launched as a centrally sponsored scheme in 1980 to replace the earlier Food For Work Programme. It was hoped that this programme would provide supplementary employment to the rural poor on projects which would create community assets. Under this programme it was specified that the ratio of material to wage costs be roughly 60:40 and the wage to be offered be on par with minimum agricultural wages prevalent in different areas. A part of the wage payment was to be paid in the form of food grains. vii). INTEGRATED RURAL DEVELOPMENT PROGRAMME Progressive reduction and ultimate eradication of poverty has been of the major goals of Indian economic policy since the beginning of the Fifty Five Year Plan. The Sixth Plan launched a direct attack on the basic problems of Rural Poverty and Unemployment. In 1979-80, an estimated 51 per cent of the population lived below the poverty line which corresponded to a consumer expenditure of Rs.76 per capital per month in rural areas and Rs. 88 in urban areas. This came down to 37 per cent by the terminal year of the Sixth Plan 1984-85. The government expected the rate to fall further 23 per cent by the end of the Seventh Plan. This was part of a long term plan to cut poverty rate by 10 per cent by the end of the Eighth Plan (1994-95). In pursuance of this strategy, the seventh plan gave a wider base to the IRDP by integrating it more effectively with agricultural and other rural development programmes. The IRDP is the single largest anti-poverty programme currently underway in all the community development blocks in the country. It was launched in 1978-79 in 2,300 selected blocks in the country and was extended to all the 5,011 blocks with effect from October 2,1980. It aims at providing income generating assets and employment opportunities to the rural poor to enable them to rise above the poverty line once and forever. The IRDP in effect seeks to redistribute assets and employment opportunities in favour of the rural poor. The IRDPs target group consists of the poorest of the rural poor under the following categories: a cultivator with a holding of 5 acres or below is a small is a marginal farmer; a person without any land, but with or without a homestead and deriving more than 50 per cent of his income from agricultural wages is an agricultural labourer; a person whose total income from

10

huge-earning does not exceed Rs.200 per month is a non-agricultural labourer.(Government of India 1980 b 3-4) The IRDB was financed by the Government of India and the Sate Government on ratio of 50-50. During the Sixth Plan period, the number of poor families assisted under the IRDB was 1656 million which was 110.4 per cent of the target of 15 million. The total expenditure on government subsides amounted to Rs. 1650.27 crores. The total bank credit mobilized for the IRDP was Rs. 3,080,41 crores which represented 103 per cent achievement of the target of Rs. 3,000 crores. Some 65 lakhs Scheduled Caste, Scheduled Tribe families (39 per cent of the total beneficiaries) benefited from the programme as against the target of 45 million, recording an achievement of 144.4 per cent. viii). JAWAHAR ROZGAR YOJANA The Jawahar Rozgar Yojana (JRY), a major wage employment programme, was launched in the last year of the Seventh Plan, i.e. on April 1, 1989, by merging the two ongoing Wageemployment Programmes viz; National Rural Emplyment Programme (NREP) and Rural Landless Employment Guarantee Programme (RLEGP) (Rao 1992: 18). JRY is expected to generate nearly 1000 million man days of employment per annum, the Centres contribution to the expenditure being 80 per cent and the States share 20 per cent (Rao 1992). JRY is being implemented in three phases. The second and third phase were introduced in 1993-94(CMIE 1996:262)
1. Under the first phase, 75 per cent of the funds allocated annually were utilized for the

implementation of the programme through out the country. 2. Under the second phase, 20 per cent of the funds allocated were provided to 120 backward districts of the country where there was a concentration of unemployment and under employment. It is known as Intensified Jawahar Rojgar Yozana. 3. Under the third phase, 5 per cent of the funds were earmarked for the prevention of migration of labour and enhancing women employment. It is called as Innovative and Special Employment Scheme. The first phase of the JRY alone includes two sub-schemes. 1. Indira Awaas Yojana(IAY)

11

2. Million Wells Scheme (MWS)

1) The IAY aims at provided dwelling units free of cost to sc and ST, free bonded labourers

in rural areas from 1993-94, the scheme has been extended to non SC/ST rural poor, below the poverty line, subject to the condition that the expenditure on such people should not exceed 4 percent of the total allocation under JRY. 2) The MW Scheme provides for open well, free of cost to poor small and marginal farmers, belonging to SC and ST and freed bonded labourers. ix). EMPLOYMENT ASSURANCE SCHEME (EAS) The EAS programme came into force from October 2, 1993. The scheme has the two folded objectives of 1) providing employment to those who are in need of work during the lean agriculture periods and Creating community assets in the villages. In addition, as specified in the guidelines, at least 100 days of employment should be assured to both men and women between the age group of 18 to 60 years. The expenditure incurred under this scheme is being shared between the Centre and the State in the ratio 80:20. The scope of scheme at the national level spreads to around 1,752 blocks of 261 districts where the Revamped Public Distribution System (RPDS) is in operation. x). PUBLIC DISTRIBUTION SYSTEM (PDS) The prime objective of Public Distribution System is to achieve a more equitable distribution of food grains and more specifically to meet the minimum food requirements of the low-income consumers at fair and reasonable prices or controlled prices. In terms of financial expenses and people covered under the PDS has been the governments major policy measure to ensure food security to the poor by subsiding rations or rice, wheat, sugar, kerosene oil and edible oil. The governments have been initiating some innovative measure to strengthen the operation.

12

1.5). OVERVIEW OF APGVB BANK AND ITS SERVICES By amalgamation, on 31st march, 2006 of the 5 banks namely Sri Visakha Grameena bank, Nagarjuna Grameena Bank, Sangameswara Grameena Bank, Manjira grameena bank and Kakathiya Grameena Bank, the Andhra Pradesh Grameena Vikas Bank was intiated with the financial support by SBI, to participate more energetically, with synergy, in the uplift and development of Rural Fram Sector and Rural Non-Farm Sector, with emphasis on the deprived, the Rural Poor, Rural ISB and Rural Crafts. The headquarters of the bank is located Warangal district. And the bank is covering eight districts namely Mahbubnagar, Nalgonda, medak, Warangal, Khammam, Visakhapatnam, Vizianagaram, Srikakulam district. The ownership ratio of the bank is as follows: 1. Share of Government of India 2. Government of Andhra Pradesh 3. State Bank of India the bank operations.
S.no 1 2 3 4 5 6 7 8

50% 15% 35% TABLE - 1

The bank have 524 branches in operation and over 2200 staff working for execution of APGVB BRANCHES IN ANDHRAPRADESH
Name of the district Khammam Nalgonda Mahabubnagr Medak Srikakulam Vishakhapatnam Vizajayanagaram Warangal Total No. of Branches 75 80 78 70 57 57 56 51 524

Source;www.apgvb.com Some of the important Loans and Advance schemes helping for the alleviation of poverty are: 1. Agriculture cash credits ( Crop loans)

13

2. Loans for Education Vidya Vikas 3. Karshak Vikas Loans to farmers against Mortgage of agricultural property 4. Rural Housing Grammeena Gruha vikas 5. SHD Federations 6. Financing of Matured SHGs for farm production 7. Palamitra Dairy Vikas Scheme 8. Laghu Vikas Swarojgar Credit Card 9. Rythu Vikas chakra 10. Vanitha Vikas etc. 1.5). NEED AND IMPORTANCE OF THE STUDY The RRBs have crucial role to play in the poverty alleviation in India. Alleviation of poverty remains a major challenge before the Government. While there has been a steady decline in rural poverty over the last two decades, yet there is still lot to be covered. The economic growth of the nation hugely depends on the poverty alleviation. The RRBs mobilizing the resources in the form of deposits and borrowings from apex institutions like NABARD and sponsor bank are concentrating on poverty alleviation schemes. While growth will continue to be the prime mover, anti-poverty programmes supplement the growth effort and protect the poor from destitution, sharp fluctuations in employment and incomes and social insecurity. The specifically designed anti-poverty programmes for generation of both self-employment and wage-employment in rural areas will improve the sustainable development in the rural India and decreases the poverty. Hence, the present study aims at analyzing the performance of RRBs with a special focus on the APGVB Bank on Poverty alleviation schemes. The study is important because it not only analyzes the performance of APGVB in the implementation of poverty alleviation programmes but also provide contribution to other researchers, banks to concentrate on implementation and maintenance of poverty alleviation schemes in India.

1.6). PROBLEM OF THE STUDY The present research study investigates the problem of Performance evaluation of RRBs a study of APGVB in Warangal district with special focus on poverty alleviation

14

schemes. The study covers this problem by studying the APGVB Bank in the implementation and maintenance of poverty alleviation schemes. 1.7). REVIEW OF LITERATURE In the wake of nationalism of commercial banks and their growing involvement with the rural development schemes sponsored by the Government during the past few years, a considerable volume of literature has emerged dealing with various aspects of the new role played by the RRBs as financial intermediaries in the process of rural development. Prior to the nationalization of commercial banks, a few studies sponsored by the official and non-official agencies dealing with the role of RRBs were notable. However to the best of our knowledge barring a few stray attempts, no systematic and empirical studies on the role of RRBs in the sphere of poverty alleviation in the Andhra Pradesh state, i.e., Andhra, Telangana and Rayalaseema regions were carried out by any agency or individual. Most of the studies undertaken on RRBs have presented their findings in the form of research articles, unpublished M.Phil and PhD dissertations in various research centers. Efforts to review a few reports and other literature on various aspects of rural credit, agricultural finance, rural development poverty_ alleviation schemes etc. relevant for the present study have been made here. Here, an attempt is made to briefly review the research findings of few studies. Among the studies conducted on RRBs the reports of working groups appointed occupied a significant place. Among these a special mention may be made about the Mr. M. Narasimham (1975). The working group noted that the major strength of the cooperative credit institutions lies in the local feel of the village society and that of commercial banks in the professional management of the business of banking. It recommended the setting up of state sponsored regionally based and rural oriented commercial banks. It also envisaged a new institution which combines the local and familiarity with rural problems which co-operatives possess and the degree of business organization, ability to mobilize, deposits, access to central money markets and a modernized outlook which the commercial bank have. The working group also recommended that the consumption loans could be provided by these banks to the poorest sections of rural masses to a specified limit despite the assumption that their concentration should be towards production credit.

15

The group reviewed the functioning of the co-operatives and Commercial Banks in disbursement of rural credit and found that both the institutions were not able to cater to the requirements of the rural poor. Therefore, the committee felt that RRBs have to be created with the participation of Central and State Govt. under the sponsorship of a Commercial Bank. The group has broadly outlined the way in which these banks are to be organized to meet the challenges of rural credit. This report is considered very important as RRBs emerged on the recommendations of this working group. The credit for initiating the first study on RRBs goes to the Reserve Bank of India. For this purpose, a committee was set up in June, 1977 under the chairmanship of Professor M.L. Dantwala to review the working of RRBs in the light of the objectives for which they were setup, to indicate their precise role in the rural credit structure and to make recommendations with regard to their scope, methods, and procedures. The main conclusion of the committee was that with suitable modification in their organization and functions, the RRBs could become a very useful component in the totality of the rural credit structure. The committee was convinced that within a short span of two years, the RRBs had demonstrated their ability to achieve the purpose for which they were established. The committee also discussed various issues related to the financial viability of these banks and concluded that the financial reports obtained on their working did show that the RRBs possess a potential and capability to attain viability and become a profit making institution. The committee to Review Arrangements for Industrial Credit for Agriculture and Rural Development (CRAFICARD) 1979, headed by Sri B. Siva Raman, recommended for the establishment of a National Bank for Agriculture and Rural Development under the control of RBI to decentralize its functions. It made several suggestions for improving the rural credit like: (1) identification of target groups like small/ marginal farmers, rural artisans, Scheduled Caste and Scheduled Tribe. (2) Simplification of terms and procedures of credit, (3) updating of landrecords and (4) project lending. The main recommendation is that preference should be given to RRBs in regard to licensing of branches to the rural areas because of its low cost operations and much concentration on weaker sections. Regarding over dues it did not favour the state governments giving total exceptions to all classes of defaulters. It described that there should be strict observance of financial discipline by all concerned for sound and sustained growth of the

16

Rural Banks Credit system in India. Based on the recommendations of this committee, NABARD was established on 1st 1982. Another committee set up by under RBI under the chairmanship of Sri Sundravardhan committee in 1980 to suggest appropriate guidelines for uniform system of internal management of rural banks and their branches. They suggested various aspects of internal management to be strengthened. Further, a working group was constituted by the Govt. of India in 1984 under the Chairmanship of S.M.Kelkar to go into various aspects of the functioning of RRBs and make suitable recommendations for further policy. The Kelkar working group found that the RRBs could cover considerable part of the rural participation through its branch network at a comparatively lower cost of operation and with the local involvement through appropriate staffing pattern. The group felt that the operations of RRBs are more in time with the national objectives of serving the weaker section. However, the group recommended that more attention should be paid to the consolidation of existing RRBs. In addition, it was felt that initiative should be taken to establish new RRBs in the areas where weaker sections are large in number. The group also recommended that the State Governments should play a major role in helping the RRBs in the recovery of over dues. The group also made several other recommendations regarding the viability, participations of NABARD, Credit Deposit Ratio (CDR), the relations between sponsoring that the measures In the year 1987 Mr. V. Anand Kumar a Research Scholar conducted a study on the organization and management of RRBs in A.P. with special references to Nagarjuna Grameena Bank (NGB) during 1978-1985. In his thesis, an attempt has been made to evaluate the performance of RRBs in A.P. in general an NGB in particular. His study is mainly concerned with deposits, advances, recoveries of loans, and working performance of NGB. Further, his study is focused on the impact of banking operations on the rural masses. Dr. M. Sunder Rao and K. Umamahesh Patnaik have published an article on the impact of Shri Vishaka Grameena Bank (SVGB) on beneficiary households. They have concluded that the impact was significant interns of the income levels, consumption position, improvement in family employment, level of infrastructure etc. Sri Venkateshwarlu (1990) made a study on rural credit by Grameena Banks with special reference to Golkonda Grameena Banks in A.P. in this study the author has examined the role of

17

Grameena Banks In rural development. The study concluded that the RRBs performance in providing credit is impressive which in turn helps in development of rural areas. Mr. Ssinha Roy (1994) has made a study on comparative performance of 8 RRBs in West Bengal. The performance is evaluated in terms of branch expansion, growth in deposits, advances, credit deposit ratio, and profits/loss. The study concluded that the working of RRBs in West Bengal showed a remarkable trend in respect of deposits and advances but most of the RRBs suffered losses in many of the years. Smt. Sita Kumari (1995) evaluated the performance of KGB and SSGB in A.P. in this study an attempt is made to evaluate the comparative performance of KGB and SSGB in terms of resource mobilization credit dispensation, recovery and other aspects related to operational performance. Sri K. Someshwar Rao(1996) examined in his study the economic viability of RRBs in A. P. A comparative study of Sri Saraswathi Grameena Bank has been undertaken. This study has examined the economic viability of selected banks by attempting cost- volume-profit analysis. His study has also enquired into the working of selected RRBs in A.P in terms of deposits, advances, over dues, capital investments in fixed assets etc. The study concluded that RRBs are becoming unviable not because of the increasing operating cost but mainly due to the commitment of RRBs in financing the Govt. sponsored schemes, priority sector advances, restriction in banking operations and banking in unstable and complex environment. Subbaraidu and others have examined in their study the role of rural banks in the implementation of IRDP. They concluded that banks should assume full responsibility through continuous evaluation. They also suggested that a separate cell have to be created for the effective implementation of the IRDP. R.K. Mittal has conducted a study on the performance evaluation of RRBs with a focus on Hisar-sirsa Kshetriya Grameena bank, Hisar. The another has examined the profitability of Rural Bank on the basis of nineteen profitability parameters. A few other studies of Mr. Sinha, Punna Rao& Satyanarayana, Navin Chandra Joshi, Anand, Shankaraiah & Bhagavan Reddy, Banoo Prem Kumar Pandya, Jagat Ram, J.P. Dupey, Mandal & Reshamwala, Asif Ali Khan, and Nawab Ali Khan, M.L. Pagaria & Dr. Ram Jass Yadav, Sajla Kalra & Karam Singh, examined the performance and working of RRBs in general

18

and their findings are consistent with the research findings and conclusions of other research studies. 1.8). OBJECTIVES OF THE STUDY The research study titled Performance evaluation of RRBs a study of APGVB in Warangal district with special focus on poverty alleviation schemes is aimed to achieve the following objectives. 1. To study the evolution of RRBs with special reference to APGVB and the operational performance of RRBs at macro level.
2. To examine the performance of APGVB in the implementation of poverty alleviation

schemes sponsored by Government agencies.

3.

To examine the nature and extent of rural development achieved through APGVB Bank in terms of assistance to poorest of the poor.

4. To assess the customer perception about the lending policies and recovery performance of the bank. 5. To investigate the problems involved in the implementation of poverty alleviation schemes by the bank 6. Finally to offer suitable suggestions for improvement of performance of APGVB. 6). SCOPE OF THE STUDY The study covers the problem of investigation of the implementation of poverty alleviation schemes by RRBs with a special focus on APGVB bank only. The study does not cover the other schemes implemented by the APGVB bank. The study also restricted to the opinion of select beneficiaries (respondents of Warangal District). 7). RESEARCH METHODOLOGY The methodology to be adopted for collection of the data, selection of samples, and analysis of data and interpretation of data is discussed below. i). Collection of data

19

The data for the research study will be collected from using both the sources of data. The primary data will be collected through a questionnaire used for the beneficiaries and bank managers. Further, the observation, direct interview will also be adopted as part of primary data collection. The secondary data will be collected from existing sources which include various reports of APGVB bank and RRB reports and also researches done on the present problem, internet, books, magazines and journals etc. ii). Sampling Technique & Sample Size While selecting the samples, the convenience sampling technique will be applied. For the purpose of obtaining information and analyzing the data, the sample size of 255 customers and 51 managers will be selected. These 255 samples include the beneficiaries who are getting the services from the APGVB Bank of Warangal District and residing in Warangal District. The detailed table is given below. TABLE - 2 S. no 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Branch name AKNEPALLY AKU.GHANPUR AZAMNAR BACHANNAPET BALAPALA BHUPALAPALLY BHUDHARAOPET CHALLAGARIGE CHELPUR DAMERA DHARMASAGAR DPO ELLANDA ENUGALLU FORT WARANGAL GHANPUR MULUGU GHANPUR Stn HANAMKONDA HASNPARTY JANGAON KASHIBUGGA KAZIPET KESAMUDRAM KHANAPUR Branch code 5101 5102 5103 5104 5105 5106 5107 5108 5149 5109 5152 5151 5110 5142 5111 5144 5112 5113 5147 5114 5115 5116 5117 5148 No. of Respondents 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 20

25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51

KOMURAVELLY KORIVI KOTHAPALLY GORI LINGALA GHANPUR MAHABUBABAD MALLAMPALLY MALLUR MAMNOOR MANDAPALLY MARIPEDA MUCHERLA MULUG NALLABELLY NANCHARIMADUR NEKKONDA OORUGONDA PALAKURTHY PARKAL PASARA RAGHUNATHPALLY REGONDA SANGEM TEKUMATLA THARIGOPPULA THORRUR VENKATAPUR ZAFFARGADH Total

5118 5119 5120 5121 5122 5123 5124 5150 5125 5126 5127 5128 5129 5130 5131 5132 5133 5134 5135 5146 5136 5141 5138 5137 5139 5140 5143

05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 05 255

iii). Hypothesis Statement For the present research study, the following hypothesis statements will be used. 1. Financing by the bank under poverty alleviation schemes has improved the economic position of the borrower. 2. The bank management is efficient in ensuring the proper utilization of loans by the borrowers. 3. Employment in rural areas has been increased by adopting different schemes by bank. vi). Techniques Applied 21

For the purpose of analyzing the statistical information, the following techniques will be used for the study. They are 1. Correlation Analysis 2. ANOVA (Analysis of Variance) 3. Factor Analysis 4. Scaling techniques

vii). Method of Presentation While presenting the data, tables and charts will be used at relevant places. Abbreviations will be used for the terms which are repeated a number of times. The index of abbreviations will be given at the beginning for ready reference. 8). LIMITATIONS OF THE STUDY The proposed research study will be restricted to Poverty Alleviation schemes of APGVB Bank only. The study further restricted to the scheme implementation to the people of Warangal District only. 9). CHAPTERISATION SCHEME Keeping in view of the objectives, the study will be organized into 6 chapters, including introduction and conclusions. CHAPTER I: Introduction This chapter I presents the introductory part of the research which include introduction to the RRBs, conceptual frame work of poverty alleviation in India, Government regulations, need and importance of the study, objectives, scope, methodology and limitations of the study.

22

CHAPTER II: Evolution of RRBs and overview of APGVB Bank This chapter presents the evolution of Regional rural banks and the evolution of APGVB bank. This chapter also aims at presenting the various acts that were passed and the government initiatives in the development of APGVB bank.

CHAPTER III: Performance evaluation of APGVB with reference to Poverty Alleviation schemes. This chapter proposed to provide analytical evaluation with reference to the evaluation of the APGVBs performance regarding poverty alleviation schemes implementation. This chapter also proposes the various problems in the implementation of the poverty alleviation schemes. CHAPTER IV: Role of APGVB in Rural Development This particular chapter focuses on the success of the APGVB in achievement of rural development through its poverty alleviation schemes. This chapter also studies the coverage of the scheme and its result in the rural development. CHAPTER V: Analysis of Survey results This chapter aims at providing the survey on the beneficiaries of the scheme and their opinions and perceptions regarding the performance of the APGVB with reference to the poverty alleviation schemes. CHAPTER VI: Summary and Conclusions

23

This chapter presents the conclusions and suggestions emerged from the study.

REFERENCES Books: 1. GOI Report on the working group of the RRBs(1984) 2. C. GananDesingan Poverty eradication a Road map, Employment News, 16-22 October 2004 P.3. 3. Krishnama Raju. S., Bank Finance and Rural Development, New Delhi; Discovery Publishing House, 1992. 4. Rayudu C. S., Agricultural Credit and Rural Development. New Delhi; Concept Publishing Company, 1992. 5. Verma M.L. Rural Banking in India , Rawat Publications, Jaipur, 1988. 6. Maheshwari, S.R., Rural Development in India, Sage Publications, New Delhi, 1985. 7. Wadhva Charan D., Rural Banks for Rural Development, Macmillan Company, Madras, 1980.

ARTICLES 1. Kaul, R.K., Role of Banks in uplifting people above the line of poverty, Prajnan, April June, 1982. 2. Bhupat M. Desai and Namboodri., Policy Strategy and Instruments for Alleviation of Rural Poverty ,- Economic and Political Weekly, Vol.33,No.41,1998. 3. GOAP(2003) Consolidating Andhra Pradesh s Poverty Eradication Action Plans, Government of Andhra Pradesh, Hyderabad. 4. Dr. Neeraja Sharma., Role of RRBs in Poverty Alleviation Through Micro, Book Marks and Share, 13 January 2011.

24

WEBSITES 1.www.google.com 2.www.wikipedia.org 3. www.apgvb.com 4. www.rbi.org.in

25