Project report on DCC Bank, APMC Yard, Shimoga

Chapter-1

1.1 Introduction:
Co-Operative banks in India are more than 100 years old. these banks came into existence with the enactment of the agricultural credit co-operative societies act in 1904. cooperative banks from an integral part of the banking system in India. These bank operate mainly for the benefit of rural areas, particularly the agricultural sector. They are the main source of institutional credit to the formers. Co-operative banks are chiefly responsible for banking the monopoly of moneylenders in providing credit to the agriculturist. They have also been an important instrument for various development schemes. Particularly subsidy based programmes for poor. Co-operative banks operate for non-agricultural sector also but, their role is small. Co-operative banks in India are registered under co-operative societies Act. The cooperative bank is also regulated by the RBI. They are governed by the banking regulation Act 1949 and banking laws (co-operative societies) Act, 1965. Though the co operative movement originated in the West, the importance such banks have assumed in India is really parallel anywhere else in the world. The co-operative banks in India play an vital role even today in rural financing. The business of co-operative bank in the urban areas also has increased phenomenally in recent years due to the sharp increase in the number of primary co-operative banks. These banks operate mainly for the benefit of rural areas, particularly the agricultural sector they mobilize deposits and purvey agricultural and rural credit with a wider outreach. They are main source of institutional credit to the farmers.
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Project report on DCC Bank, APMC Yard, Shimoga

Though much smaller as compared to scheduled commercial banks, co-operative banks constitute an important segment of the Indian banking system. They have an extensive branch network and reach out to people in remote areas. They have traditionally played an important role in creating banking habits among the lower and middle-income groups and in strengthening rural credit delivery system. The cooperative movement in India owes its origin to agriculture and allied sectors. Towards the end of the 19th century, the problems of rural indebtedness and the consequent conditions of farmers created an environment for the chit funds and cooperative societies. The farmers generally found the cooperative movement an attractive mechanism for pooling their meager resources for solving common problems relating to credit, supplies of inputs

and marketing of agricultural produce. The experience gained in the working of cooperatives led to the enactment of cooperative credit Societies Act, 1904. Subsequently, a more comprehensive legislation called the Cooperative Societies Act was enacted. This Act, inter alia, provided for the creation of the post of registrar of cooperative societies and registration of cooperative societies for various purposes and audit. Under the Montague-Chelmsford Reforms of 1919, cooperation became a provincial subject and provinces were authorized to make their own cooperative laws. Under the Government of India Act 1935, cooperatives were treated as a provincial subject. The item Cooperative Societies is a State Subject under entry No 32 of the State List of Constitution of India.

1.2 Statement of Problem:

The present study is directed towards understanding performance of Shimoga district co-operative central Bank. The DCCBs form an integral part of the rural banking system in performing their activities on co-operative principles. These banks function as the central agency between SCBs and PACS in the district. The effective credit delivery requires equally efficient and
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Project report on DCC Bank, APMC Yard, Shimoga

effective mobilization of resources. Therefore, the analysis and appraisal of efficiency of the vital functions of the DCCBs i.e., mobilization of resources and deployment of credit receives more attention of all especially in the context of management planning and decision-making. And there by helps in enhancing the public faith, confidence assurance and guarantee on the worked flow of bank while performing the banking activities.

1.3 Need for the study:

The DCCBs play a decisive role in the development of both agriculture sector of the economy. With the passage of time, DCCBs developed in their growth, nature of the their operation and scope of their activities. In the process of expansion certain problems and difficulties cropped up in the various areas of their operation. In such a situation, management of finances is one of the activities, where DCCBs have to perform more efficiently. In this connection, DCCBs have to perform more efficiently and have to mobilize recourses. So, as to enhance their confidence and faith in the public. Therefore, DCCBs expect to widen their lending base more effectively in order to survive in the changed liberalized era. Hence, an evaluation of the performance of SDCCB is examined under the ambit of changed economic scenario.

1.4 Objective of the study:

1. The study the performance of district co-operative central banking activities. 2. To analyze the extent of recovery and over dues of Shimoga district co-operative central bank, APMC branch. 3. To examine the performance of Shimoga district co-operative central bank in the light of pre and post economic reforms. 4. To offer suggestions for improving the performance of Shimoga district co-operative central bank. 5. To study about loans and advances provide by the bank.
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Project report on DCC Bank, APMC Yard, Shimoga

1.5 FUNCTION:
1. As per the policy of the RBI, the establishment of cooperative banks in the district is mainly to fulfill the needs of the farms though PACS. 2. The Shimoga DCC bank accepting deposits from the publics in the form of savings bank account, fixed deposit account, and other types of deposits to raise the resources. The bank is refinanced from Apex Bank, NABARD, Government and other financial agencies.

1.6 Scope of the study:

The present study made an attempt to study the performance and problems of SDCCB. The study covered the origin of co-operative movement, growth of credit structure, place and status of DCCBs. In resource mobilization, loans recovery and overdue of the banks.

1.7 Sources of data:

The data is collected from primary as well as secondary source. Primary Data Primary data gathered through interactions and discussions with the Manager and staff members of the bank. Secondary Data The secondary data extracted from banks annual reports, and gathered from the published sources in the academic libraries and the study also had planned to use different source through internet.

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Project report on DCC Bank, APMC Yard, Shimoga

1.8 Limitation of the study:

The present study is being conducted from the performance of co-operative central bank. it is not free from limitation. 1. The study is restricted only to the limits of APMC branch Shimoga district. 2. Time limit is also one limitation of the study. 3. The most agriculturists are illiterate and they dont have any idea about the study. 4. The bank doesnt have much online transaction and information. 5. The bank doesnt have ATM facility.

1.9 Chapter Schemes:

The present study is divided in to following chapter. 1st chapter: This chapter is an introductory chapter of the study it covers introduction, statement of problem, objective of the study, need for the study , scope and limitation of the study and chapterization. 2nd chapter: Profile of the Bank. It cover brief profile of the district bank, Membership of SDCC Bank, branch profile and Organizational Structure.

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Project report on DCC Bank, APMC Yard, Shimoga

3rd chapter: Profile of the schemes, deposit schemes, loan schemes, agricultural other service of SDCC Bank, funds of district co-operative bank, Management of district Co-Operative Banks, functions of D.C.B, CRR, SRR 4th chapter: This chapter is including Financing Strategy, Human Resource Management strategy, Recruitment Policy and Marketing Strategy 5th chapter: Findings, Suggestions, and Conclusion.

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Project report on DCC Bank, APMC Yard, Shimoga

Chapter-2

2.1Profile of the Bank:

The co-operative movement was started in India in 1904 with objective of providing finance to agriculturists for productive purposes at lower rate of interest and there by a large number of agricultural credits societies was setup in village under the co-operative societies act of 1912. This act contributed to the establishment of central co-operative bank and state co-operative bank to provide are finance to primary agriculture credit societies. Up to 1949 co-operative banks were not came under Banking Regulation Act. The government of India made banking regulation act applicable to co-operative societies in 1949 by enacting banking regulation act 1949. The Shimoga District Co-operative Central Bank Ltd. Shimoga came into existence as Central Financing Agency of Co-operative Societies in the District in 1953 with its Head Office at Shimoga vide, Register No: ARS/1041/18-10-1953 under all India Co-operative Societies Act 1912 to cater to the needs of the co-operative institutions and render valuable services to the general public in the banking field. Initially it was started with Rs.30,000 as a share capital having single branch, at present this bank is operating with a own capital of Rs.3711.83 lakh and is having 21 branches across the district. The District Central Co-operative Bank are the federations of Primary Agricultural Credit Societies operating in specified area, normally extending to a district. The Head Offices are established at district headquarters.

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Project report on DCC Bank, APMC Yard, Shimoga

Membership of SDCC Bank:

The membership of the bank is restricted to co-operative societies. Which have registered with in the area of operation referred in law 1(IV) the state government is eligible for admission. Any individual residing in the year of operation of the bank over 18 years of age and of sound mind shall be eligible for admission as a nominal member. When applying for admission, a societies shall submit along with its application a resolution of the board, may from time to time prescribe both a form and amount for the purpose of becoming member and may sanction or refuse the application at its discretion. Every member shall hold more share than the number of shares. Which shell be represent one fifth of the paid-up share capital of the bank. The total member of the bank stood at 613 of which 160 are PACS, 22 marketing and processing societies, 86 urban banks and urban societies and 345 are other types of societies

Branch Profile:
DCC bank APMC yard branch shimoga was established in the year 2001. It is the sub branch of shimoga city. It is located in APMC yard sagar road, in this place many small scale firms, arecanut market and gowdens. As the bank it is helpful for the business persons, agriculture people and for a common man with limited by this bank.

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Project report on DCC Bank, APMC Yard, Shimoga

Bank Name: Branch Name: Director: Assistant director: Branch Manager: No.Of employees: Deposit Account holders: Loan account holders: Under S.H.Groups:

DCC Bank. APMC yard. Dr. R.M. Manjunath. Vijaidev Mr.Umesh 7 5,000 701 28

Total loan lending Amount: 13, 62, 68, 000 Address: DCC bank APMC Branch 1st Flore RMC building. Near RMC police station APMC yard Shimoga: 577 201 City: State: Shimoga. Karnataka.

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Project report on DCC Bank, APMC Yard, Shimoga

Organizational Structure:

President (director)

Managing director

Assistant director

General Manager

Manager

Cashier

Clerk

Clerk

Clerk

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Project report on DCC Bank, APMC Yard, Shimoga

Chapter 3 Profile of the scheme

In DCC bank there are different types of deposit schemes, loan scheme and other schemes, they are:-

Deposit schemes:

Account types

No. of accounts

Saving account Current account Fixed deposit Recurring deposit S.C deposit

2500 50 200 50 2200

Loan schemes:
Security for Loan For crop loan following securities are accepted Land Crop 1 or 2 sureties

For Medium Term Loan: Normally level is accepted as security from concerned member of PACS. In case of default agriculture income and land are attached till the amount is recovered.
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Project report on DCC Bank, APMC Yard, Shimoga

Maximum Limit for Crop Loan: Maximum amount of loan granted to the members. Following is the details of loan that can be sanctioned for different crops under kiss and credit loan for 1 care of land

Types of loan Home loan Vehicle loan Salary earning loan Over draft loan to business Gold loan Medium term industry loan Rural gowden loan Home pledge

No.of beneficiar 20 300 56 7

Total loan amount 95,00,000 1,54,00,000 19,00,000 11,00,000

Rate of interest 14% 14% & 15% 16% 16%

250 3

1,00,00,000 33,00,000

13% to 13.5% 15%

9 28

8,00,00,000 1,41,00,000

13.5% 15.75% to 15.5%

Agricultural Schemes and Other Services of SDDC bank:

Self Help Group. Kisan Credit Card Scheme. Gramin Bhandaran Yojana(GBY). Scheme for cattle farming and dairy farming. Kisan Chakra Scheme. Establishment of Bio-Fertilizer Units.

Produce Marketing Loan (PML).

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Project report on DCC Bank, APMC Yard, Shimoga

Self Help Group:

Self-help Group has been promoted to reach the un-reached rural poor. The bank had taken several steps to promote and to credit link the Shimoga. In the year 1999 bank has started promoting Shimoga in the district. To promote the SHGS, bank has taken assistance from NGOS, government department, PACS along with the bank staff. At present bank has promoted 4819 SHGS in the district, distributed the savings and linkage with bank and PACS. The APMC branch also providing loan for Self-help group in the last year the bank was distribute the loan for Rs 2,50,000 @12% interest for 28 Self-help groups. The state government give the 8% subsidy SHG.

Kisan credit card:

The government of India has directed the commercial/co-operative/RRBS to

introduce kisan credit card scheme for enabling formers to meet their production credit requirement in a cost effective and flexible manner. our bank caters to the credit requirement of about 71,300 former. At present bank has issued 64865 kisan credit card and 63583 member are covered under PAIS. So for, 71 formers are benefited under the scheme to the tune of Rs 31.50lakhs. out of the beneficiaries 56 formers are disabled. This bank has to provide 7,18,000 kisan credit card loan for the former. Which formers are taking a kisan credit card loan up to 1 lakh there is no interest, 1 lakh to 3 lakh 1% interest and 3lakh and above 12% interest.

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Project report on DCC Bank, APMC Yard, Shimoga

Medium Term Schematic:

Bank had disbursed medium term schematic loans to the formers during the year 2011-12 to the tune of Rs 64.96 lakhs for 43 members. The major finance is involved in pump sets, drip irrigation, pipelines and areca dryers.

Funds of district Co-operative Banks:

The funds of district co-operative banks consists of share capital reserve fund. Deposits from members and the general public and loans from the reserve banks of India, the state Govt. and commercial Banks, however, loans and advances from the reserve Banks constitute the major part of their funds.

Management of district Co-Operative Banks:

The district co-operative Banks are managed by board of management constituted by the representative of district co-operative banks and the individual shareholders, however, district co-operative banks have majority representation in the board of management.

Functions of district co-Operative Bank:

The functions of district co-operative banks are as follows. 1. The main function of district co-operative bank is to lend fund to the central cooperative banks, which in term advance loan the primary credit societies. 2. They serve as the balancing centers between district central co-operative banks they attract the surplus funds of some district central co-operative banks and make them available to the needs central co-operative banks.
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Project report on DCC Bank, APMC Yard, Shimoga

3. They borrow funds from the RBI and lend the same to the central co-operative banks to be used for financing the primary credit societies. So, they act as a link between the RBI on the one hand. And the central co-operative banks and the primary. credit societies on the other hand. 4. They accept deposits from the general public in eh urban areas and make them available for rural credit. Thus, they help the transfer of funds from urban areas to the rural areas. 5. They exercise general supervision and central over the activities of he central cooperative banks. 6. They help not only co-operative credit institution but also promote other co-operative societies.

Cash Reserve Ratio:

CRR is the percentage bank reserve to deposits and notes. The cash reserve ratio also known as the cash asset ratio. Central bank ordered commercial banks to hold a larger share of deposits in cash, and raised a key short term lending rate in a bid to high inflation that has stoked fears of overheating. Calculation of CRR formula:

Actually maintained-Required to be maintained= surplus/deficit

124043 - 124043

36254
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Project report on DCC Bank, APMC Yard, Shimoga

Statutory Liquid Ratio:

This is infact to protect us, RBI demands that there should be certain amount that bank needs to keep in the form of cash, gold or government approved securities and the remaining is only they have to give it customers either as credit in any form, as loan, mortgage or something. This will really help to RBI to control the expansion of bank credits. Reserve Ratio Of SDCC Bank, Cash Reserve Ratio is 9% and statutory liquid Ratio is 25%.

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Project report on DCC Bank, APMC Yard, Shimoga

THE SHIMOGA DISTRICT COOPERATIVE CENTRAL BANK LTD, SHIMOGA APPENDIX - I

Name of the Bank: The Shimoga District Co-op. Central Bank Ltd., Shimoga Monthly Statement showing the daily position of maintenance of Cash Reserve under Section 18 of the Banking Regulation Act 1949 (as Applicable to Co-op. Societies ) during the month of February - 2012
(Rs rounded off to the nearest thousand) Date Amount of Cash Reserve Required to be Actually maintained maintained Deficit Surplus Remarks

01-02-2012 02-02-2012 03-02-2012 04-02-2012 05-02-2012 06-02-2012 07-02-2012 08-02-2012 09-02-2012 10-02-2012 11-02-2012 12-02-2012 13-02-2012 14-02-2012 15-02-2012 16-02-2012 17-02-2012 18-02-2012 19-02-2012 20-02-2012 21-02-2012 22-02-2012 23-02-2012 24-02-2012 25-02-2012 26-02-2012 27-02-2012 28-02-2012

87789 87789 87789 87789 87789 87789 87789 87789 87789 87789 87789 87756 87756 87756 87756 87756 87756 87756 87756 87756 87756 87756 87756 87756 87756 88158 88158 88158

124043 111125 136654 107562 99640 99640 117529 128390 122848 126855 125215 126711 126711 126053 126436 126436 130870 133525 151296 151296 126651 139257 153330 148075 130734 114956 114956 125897

--------------------------------

36254 23336 48865 19773 11851 11851 29740 40601 35059 39066 37426 38955 38955 38297 38680 38680 43114 45769 63540 63540 38895 51501 65574 60319 42978 26798 26798 37739 0 0 0

--------------------------------

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Project report on DCC Bank, APMC Yard, Shimoga

THE SHIMOGA DISTRICT COOPERATIVE CENTRAL BANK LTD, SHIMOGA APPENDIX - II

Name of the Bank: The Shimoga District Co-op. Central Bank Ltd., Shimoga Monthly Statement showing the daily position of maintenance of Liquid Assets under Section 24 of the Banking Regulation Act 1949 (as Applicable to Co-op. Societies ) during the month of February - 2012
(Rs rounded off to the nearest thousand) Date Amount of Liquid Assets Required to be Actually maintained maintained Deficit Surplus Remarks

01-02-2012 02-02-2012 03-02-2012 04-02-2012 05-02-2012 06-02-2012 07-02-2012 08-02-2012 09-02-2012 10-02-2012 11-02-2012 12-02-2012 13-02-2012 14-02-2012 15-02-2012 16-02-2012 17-02-2012 18-02-2012 19-02-2012 20-02-2012 21-02-2012 22-02-2012 23-02-2012 24-02-2012 25-02-2012 26-02-2012 27-02-2012 28-02-2012

731574 731574 731574 731574 731574 731574 731574 731574 731574 731574 731574 731303 731303 731303 731303 731303 731303 731303 731303 731303 731303 731303 731303 731303 731303 734652 734652 734652

787254 774336 799865 770773 762851 762851 780740 791601 786059 790066 788426 789955 789955 789297 789680 789680 794114 796769 814540 814540 789895 802501 816574 811319 803978 787798 787798 798739

-----------------------------

55680 42762 68291 39199 31277 31277 49166 60027 54485 58492 56852 58652 58652 57994 58377 58377 62811 65466 83237 83237 58592 71198 85271 80016 72675 53146 53146 64087

-----------------------------

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Project report on DCC Bank, APMC Yard, Shimoga

Chapter 4

Financing Strategy:
Providing kisan credit card facility. Providing loan facility to farmers and commercial business. Lending loan to purchasing agriculture machines and tools to eligible account holders. Providing loan to farmers up to 1lakh there is interest for craft loan .

Human Resource Management strategy:

The DCC bank APMC yard branch in Shimoga district. The working staffs of this bank are very effective because human resource strategy. In this branch 7 human resource members working in place, one manager, one cashier,3 clerks are there.

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Project report on DCC Bank, APMC Yard, Shimoga

Recruitment Policy:
They have recruiting the required staff through conducting written test and oral test through the issued by the government and they have some recruitment prociger. Any candidate can applied the application for job. Eligible candidate are the selected the job. Transfer will be made with in the district not other district banks. Employees are get the equal rights. Employees get the promotion after 5 years experience. Increment also considering based on experiance.

Marketing Strategy of APMC Branch Bank:

Advertising through newspaper. Three field officers in DCC bank. DCC bank has own website and doing promotional activities through the website. Arranging press conference for special issue.

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Project report on DCC Bank, APMC Yard, Shimoga

Chapter 5

Findings:
The administration of the head office is very systematic ATM Center facility is not there in DCC Bank. The DCC Bank is a focusing on full utilization of the available source of without keeping any assets idle. The deposits of the bank are raised over the year and the advance also moving upward DCC Bank has good HR strategies to develop the Human resources. Maximum customers have a savings bank account in the bank.

Suggestion:
a) The resources of the co-operative banks should be improved. Their dependence on outside resources mush be reduced considerably. b) The liability of the members of the primary co-operatives should be make limited. c) Loans should be given not on the basis of the assets of the member but on the basis of estimated values of production. d) There is a need of ATM centers. e) Insurance facilities should be extended for all crop. f) More employment opportunity provided by the bank to meet the excess work load. g) The bank has to adopt E-banking system. It reduces the time as well as quick service to the customer. h) reduces the time as well as quick service to the customer. i) The APMC branch is need for good building and internal structure.
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Project report on DCC Bank, APMC Yard, Shimoga

Conclusion:

Courtesy of the employee is found excellent which reveals the fact that bank has made a unique place for itself in the mind of customers. Staff members will interact immediately when customers approach them, as the result a good customer relationship is built. And also Co-operative

societies suffer from various weaknesses and their performance has been far from satisfactorily in certain respects. The heavy over dues of co-operative societies are a cause for concern. The bank should increase the loan facility to the former at reasonable or lower interest
rate. The bank should provide E- Banking facility and ATM facility for the customer.

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Project report on DCC Bank, APMC Yard, Shimoga

Bibliography

Bank: DCC Bank main branch Shimoga. DCC Bank, APMC yard branch Shimoga. Website:

www.karnatakaapex.com

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