Executive summary With a view to cater the seasonal financial requirements for agriculture & other allied activities at state level, The Rajasthan State Co-operative Bank Limited (RSCB) was established & registered under Rajasthan Cooperative Societies Act on 14 th October 1953. It is an Apex institutions of the District Central Cooperative Banks (DCCBs) functioning in the state. The governance of village level Primary Agriculture Cooperatives, District Central Cooperative Banks RSCB is ensured by elected board through a democratic election system under The Rajasthan Cooperative Societies Act. Willingness of Cooperative banks to adopt SHG concept as “Social banking with profits” and its interest in trying innovation. Bank should provide adequate incentives to their branches in financing the Self Help Groups and established linkages with them, making the procedures absolutely simple and easy while providing for total flexibility in such procedures to suit local conditions. With micro credit, loan amounts are reduced and lending methods are adapted to accept the collateral and reimbursement capacity of disadvantaged clients, thus giving them access to financial resources, a valuable tool.
Transcript
Executive summary
With a view to cater the seasonal financial requirements for agriculture & other allied activities
at state level, The Rajasthan State Co-operative Bank Limited (RSCB) was established &
registered under Rajasthan Cooperative Societies Act on 14th October 1953. It is an Apex
institutions of the District Central Cooperative Banks (DCCBs) functioning in the state. The
governance of village level Primary Agriculture Cooperatives, District Central Cooperative
Banks RSCB is ensured by elected board through a democratic election system under The
Rajasthan Cooperative Societies Act.
Willingness of Cooperative banks to adopt SHG concept as “Social banking with
profits” and its interest in trying innovation. Bank should provide adequate incentives to their
branches in financing the Self Help Groups and established linkages with them, making the
procedures absolutely simple and easy while providing for total flexibility in such procedures to
suit local conditions.
With micro credit, loan amounts are reduced and lending methods are adapted to accept
the collateral and reimbursement capacity of disadvantaged clients, thus giving them access to
financial resources, a valuable tool.
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8. INTRODUCTION OF INDUSTRY
1.1 The Housing Finance and Development Scenario
Pre-Independence Scenario
Taking up records of the bygone century, it is notable that the deficit-housing problem in
India was not so aggravated till the first half of the century. Census records reveal that
in 1901, there were 55.8 million houses for 54 million households, which means that
there were 1.8 million surplus houses. This surplus continued till 1941. But then a phase
came, where this surplus turned into a deficit to 1.7 million, in correspondence to 64.3
million houses for 660 households. The maximum surplus period between 1911 to 1931
was because, many urban centre during the period were affected by plague and famine
which caused death on a large scale, resulting in households to grow slowly, leaving
enough room for house construction to cope with the household growth.
The Second World War (1939-1945) totally changed the situation. Labourers’ migration
was seen to the towns to work in factories for producing ammunitions and other war
supplies. During this period, there was a scarcity of labour and materials for housing
construction. After the War, many labourers continued to stay in urban centers and
adding pressure on the housing situation. This became the initial turning point towards
housing requirements.
The situation continued and aggravated in 1947. In the wake of the partition of the
country about 7.5 million of displaced persons migrated into India and Pakistan. With
India achieving independence and taking a giant leap in terms of progression and
industrialization, improvement of health facilities and the death rate coming down and
the considerable growth in population and the influx of job seekers into urban India,
mounted up pressure on the housing problem. By 1971, the ratio of total number of
households to the number of houses was 100.4/90.7 million, taking up the deficit to 9.7
million.
The Present Scenario
Despite considerable investment and efforts over successive Plan periods, the housing
problem continues to be daunting in terms of the large number of homeless households,
rapid growth of slums and unauthorized colonies, spiraling prices and rents of land and
houses, rampant speculation, deficient availability of water, sanitation and basic
services top bulk of the population and the increasing struggle of the poor and
vulnerable sections to secure affordable and adequate shelter. The housing shortage
was estimated by the National Buildings Organization in 1991 to be about 31 millions
units, composed of 20.6 million in rural areas, and 10.4 million in urban areas, with; the
bulk of the backlog consisting of “kuchcha” unserviceable units.
By 1997 the total housing shortage came down in the country and was estimated to be
13.66 million units, out of which 7.57 million units were in the urban areas. More than
90% of this shortage was for the poor and the low-income category. The rapid growth of
urban population and its concentration in 300 cities with a population exceeding 0.1
million started showing congestion and overcrowding in small houses, leading to steady
growth of slums, informal settlements and severe pressure on the civic services. The
population explosion and cross migration further led to the inadequate supply of
affordable housing by public & private sector, the acute shortage of funds of the
development of settlements and extension of city level infrastructure. This has been
aggravated by institutional deficiencies of housing agencies and local bodies, and
insufficient attention to the shelter needs of the poor.
Future Prospects
It is estimated that by 2012 and with the current rate of growth in population, India would
require at an average of 2.5 million to 3 million additional dwelling constructions
annually. Presently, only a meager 20 % of India's new housing units are financed
through formal housing finance institutions, although there is a remarkable prospective
to augment the figure of home credit. With Government’s timely intervention housing
finance on its own has become a major industry in India. With the semi government and
nationalized Banks, the private sector too has shown a tremendous interest in the race.
With various plans to suit one’s necessity and with attractive interest rates, these
housing finance institutions offer most attractive finance options for home seekers.
1.2 The National Housing Bank
To give a boost to the housing scenario in India and to narrow down the margin
between the housing demand and the availability of houses, the National Housing Bank
was set up in the year 1988. This was done by keeping in mind that a home seeker
though does have a desire for a house but lacks the resources for construction or
buying it, hence to give an enhancement to private housing finance institutions the
National Housing Bank came into the existence. NHB has emerged as a principal
agency to promote housing finance institutions both at local and regional levels while
providing financial and other support to such institutions. It is important to keep in mind
that the National housing Bank itself does not give loans or finance individuals or a party
as such but it is only a corporate body to promote, establish, support or aid the housing
finance institutions.
The housing finance institutions can be segregated into three categories namely Public
Sector Financial Institutions, Banks and Private Sector Financial institutions.
Public Sector Financial Institutions
There are a no. of financial institutions working in the field of housing finance:-
HUDCO (Housing and Urban Development Corporation Limited): HUDCO is an
influential Government of India Enterprise. Its main aim is for funding state governments
for infrastructure development and intends to surface as the only organization of its kind
for dealing with the needs of shelter and infrastructure development in the human
Saya Housing Finance , Vyasa Bank Housing Finance , Vijaya Home Loans , VI Bank
Housing Finance and Weizmann Homes.
It is interesting to note that Tata Homes Finance Ltd., and Birla Home Finance Ltd.,
Reliance Industries and GE Capital have joined the housing finance providers race. A
boost to the housing finance industry can push up the Indian economy scenario in a
large scale. Housing has a tremendous tendency to create income and insist for
resources, tools and services.
Various housing finance companies have their own set of offerings as far as housing
loan interest rates in India are concerned. There are a variety of housing loans available
in India which includes:-
□ Home Purchase loan
□ Home Construction loan
□ Home Extension loan
□ Existing Home Improvement loan
□ Land Purchase loan
INTRODUCTION TO ORGANIZATION
A Co-operative bank is an autonomous association of persons united voluntarily to
meet their common economic, social, cultural needs & aspiration.
It is a jointly owned and democratically controlled enterprise organized and operated under
cooperative principles.
Cooperative 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 fulfill,
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 banks in India play an
important role even today in rural financing. The business of cooperative 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.
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:
· Farming
Cattle
Milk
Hatchery
Personal finance
Cooperative banks in India finance urban areas under:
Industries
Self-employment
Small scale units
Home finance
Consumer finance
Personal finance
Apex Bank (Rajasthan State Cooperative Bank Ltd.)
With a view to cater the seasonal financial requirement for Agriculture & other allied
activities at the level, The Rajasthan State Cooperative Bank LTD.(RSCB) was
established & registered under Rajasthan State Cooperative Societies Act on 14th
Oct ,1953.It is an apex intuition of the District of village level Primary Agriculture
Cooperative Societies, District Central Cooperative Banks functioning in the state .
RDCB is ensured by elected board through a democratic election system under The
Rajasthan Cooperative Societies Act.
RSCB has successfully completed more than five decades of services to the state of
Rajasthan in general and to the rural and farming community in particular.
In Rajasthan, RSCB has converted its regional offices into regional branches and
presently Udaipur and Jodhpur branches are catering the financial needs of DCCB
situated in their area of operation since financial year now Kota, Bikaner &
jaipur.Regional branches are also providing short- term agricultural loans to DCCBs
situated at head quarter in their respective area of operation
RSCB has successfully completed more than five decades of services to the state of
Rajasthan in general and to the rural and farming community in particular.
The bank has shifted its new Head-Office premises at Tonk Road Jaipur. The bank was
established to provide short term agriculture loan for agricultural, rural development, non-
agricultural loans, employment oriented schemes and short term loans. The bank has an image at
national level and it has been honored several times.
APEX BANK
RSCB being one of the good cooperative banks opened its branch at Jaipur on 14th
October 1953. Jaipur is a big market of jewels import export and with new opportunities
of business and personnel growth this fact was noticed by the organization and finally a
branch of RSCB was inaugurated by Chief Minister Vasundra Raje. Branch is now
working efficiently and has a good deal of investments.
Branch is located AT Tonk Road which is one of the most suitable areas for such
organizations. The bank address is
Head Office
Registered office and Group Head Office
Lal Kothi,DC-1,Tonk Road Near Nehru Place, Jaipur
Branch Office
- Jawahar Nagar,CC 212, Gola Market, Jaipur
- C-Scheme J.D.A Complex,Ahinsa Circle, Jaipur
- Barkat Nagar,Sharma Store Lane- Tonk Phatak, Jaipur
- Nehru Bazar,22/32/01 Jaipur
- Malviya Nagar,A-87, Shivanand Nagar,
Near Kailgiri Hospital, Malviya Nagar, Jaipur
Introduction of Corporation
Historical Background
50 years constitute an important milestone in the growth and progress, as much in the
case of an individual, as of an institution. The Rajasthan State Co-operative Bank Ltd.(RSCB)
can look back with satisfaction about the contribution it has made for the improvement in the
quality of life in the rural areas. progress is a continuous process without a full stop. Bi-
centenary celebration should also provide an occasion for drawing up a road map of
development for the years to come, say, at least 20 years, if not 50 years.
A quick glance through the published figures regarding the financial position of the RSCB
from 1953-54 to 2002-03 indicates the following:
1 The share capital has gone up by 700 times.
2 The reserves have gone up by about 19000 times.
3 The growth of deposit has also been equally phenomenal from a small Rs.36, 000 to Rs.
992.00 crores.
4 Similarly, outstanding loans have gone up from mere Rs. 25,000 to Rs. 1,111.00 crores.
5 The working capital,which was less than Rs.6.00 lacs,has also gone up to over
Rs.1,970.00 crores.
6 The profit from Rs. 1,000 has gone up to over Rs. 15.00 crores.
financial picture also reflects some specific years, which constitute turning points. For
instance, the loans outstanding in 1968-69 were almost double what they were during
the previous year. In 1974-75, there was a two-fold growth compared to 1972-73.
During 1980-81, the loans outstanding crossed Rs.100.00 crores marks.
Network
In order to achieve the objectives of the Cooperatives, an extensive network is
available to cater the need of rural masses at their doorstep with a three tier short-term
cooperative credit delivery system.
At the Apex level, Rajasthan State Cooperative Bank (RSCB) with its 5 Regional
& 8 local branches in the State.
At the District level 29 DCCBs covering 32 Districts of the State having 390
branches.
At the grass-root level 5255 PACS which covers 100% of the geographical area
of the state, i.e., 41353 villages.
Out of total 53.64 laces cultivators in the State, about 42.27 laces are the
members of PACS/LAMPS, of which 21.36 laces are borrowing members of the
societies.
Mission
The corporate mission is to become a strong and competitive cooperative banking
network which offers innovative financial products along with varied range of service to
serve rural masses with rejuvenated short-term cooperative credit structure to serve the
people of Rajasthan.
Vision
cater with both the rural and urban sector and to become a bank which can establish new RSCB envisages itself to become a bank which will be able to standards.
PRIORITIES
1 by the To issue Kisan credit card to all eligible farmers.
2 To increase the borrowing membership up to 21 lacs end of March 2008.
3 To inculcate thrift habits in rural areas by mobilizing rural savings through
PACS(Primary Agricultural Cooperative Credit Societies) and branches of
DCCBs.
4 To implement personal accidental insurance scheme covering borrowers and
customer of cooperative sector.
5 To release farmers from the clutches of money lenders by providing cheaper and
timely institutional credit.
6 To increase investment credit to farmers to create/enhance capital formation in
the state.
7 To support state Government’s efforts to implement the revival package for short-
term cooperative credit structure.
8 To bring about technological changes in the short-term cooperative credit
structure.
9 To enhance corporate image of cooperative banking in general and Apex Bank in
particular.
Financial growth at glance
NET PROFIT
19.3421.15 21.36
0
4
8
12
16
20
24
2004-05 2005-06 2006-07
2004-05
2005-06
2006-07
Deposits
1139.26 1198.171305.84
0100200300400500600700800900
10001100120013001400
2004-05 2005-06 2006-07
2004-05
2005-06
2006-07
Objective of the Bank
According to Bye-laws main objectives of RSCB are as under
1 To promote the economic interest of the bank in accordance with cooperative
principles;
2 To receive money on current/various fixed deposits or other accounts and to
raise or borrow from time to time such sums of money as may be required for the
purpose of the bank.
3 To grant loans to cooperative institutions registered or deemed to be registered
under the act and other members enrolled as per provisions of the Bye-laws;
4 To lend money or grant overdrafts to, or open cash credit for, depositors and
members of the bank’s staff on the security of:
Fixed deposits,
Government securities, and
Other securities approved by the Registrar, also grant clean
overdrafts to depositors, who are at least nominal members according to the rules
framed by the board
5 To serve as a balancing center for all-cooperative bank and societies in the state;
6 To undertake inland exchange business by collecting or discounting bills of
exchange and hundies or to issue demand drafts. The discounting of bills shall be
for those who are at least nominal members according to rules framed by the
board;
7 To receive for safe custody securities, ornaments and valuables;
8 To open branches where necessary in its area of operation
9 As federal organization, its play leadership role by providing consultancy, guidance
and technical support to its affiliates.
GOALS OF THE FUTURE (2008-09)
1 Disbursement of Rs.1300.00 crores loan under short term Agriculture loan.
2 Disbursement of Rs.70.00 crores loan under Investment Credit (Agriculture & Non
Agriculture).
3 Attain the level of Rs.1350.00 crores in deposits of the Bank.
4 Attain the level of Rs.2200.00 crores in total loan outstanding of the Bank.
5 Attain the level of Rs.3200.00 crores in the working capital of the Bank.
6 Computerization of All Branches of the Bank.
7 To open a new branch in Jaipur city.
OTHER ACTIVITIES
CREATING INNOVATIVE FINANCIAL PRODUCT FOR THE POOREST OF THE POOR (SELF HELP GROUPS):
Under the micro-credit system promoted by short-term cooperative credit structure in
the state, the DCCBs/PACS have been playing the role of facilitators to organize self
help groups of homogeneous class to address their common socioeconomic needs by
pooling their resources to make available small interest bearing loans to their members.
The process helps them to imbibe the essentials of financial intermediation including
prioritization of needs, setting terms & conditions, accounts keeping and building financial discipline by handling of a size beyond their individual capacities. These
groups are graduated to be linked with DCCBs/PACS. So far approximately 16000
SHGs have been linked with DCCBs/PACS and an amount of Rs. 4709.21 lacs has
been advanced to SHGs up to 31.3.07.
PERSONAL ACCIDENTAL INSURANCE SCHEME:
Personal Accidental Insurance Scheme has been introduced in the state through District
Central Coop. Banks with an objective to provide financial security to its loanee
members, customers, Depositors &staff members at a nominal premium against the
accidental losses. During the year 2006-07 and 07-08 (1-1007); 10.71 lacs loanee KCC
holder and staff members were insured and an amount of Rs. 74.99 lacs was remitted
to the Insurance Company against which 74 claims have been settled.
CROP INSURANCE SCHEME:
State Govt. has launched crop Insurance Scheme from Kharif crop, 2003 under which
prescribed crops in the notified area are being insured. As insurance premium of
Rs.2251.24 lacs for kharif crop, 2006 and Rs.1300.26 lacs for Rabi crop during the year
2006-07 has been remitted to the insurance company. Due to failure of crop, claims of
Rs.10214.50 lacs for kharif, 2006 crop and Rs.2380.65 lacs for the Rabi. 2007-08 crop
were paid to the affected farmers.
HIGHLIGHTS AND IPSO-FACTO
YEAR 2007-08
v RSCB registered an annual growth of 0.99 percent in earning net profit.
v RSCB registered an annual growth of 2.34 percent in own fund.
v RSCB registered an annual growth of 8.47% in advances.
v RSCB registered an annual growth of 15.135 in working fund.
v Cost of Management of RSCB reduced to 0.25% which is far below the norms
prescribed by Reserve Bank of India. It is also lowest amongst State Cooperative
banks in the country.
v The level of recovery against demand stood at 98.22%.
v Per employee productivity was to tune of Rs.10.58 crores and per branch
business was Rs.218.82 crores.
v RSCB has established India’s first currency chest in the cooperative sector in
its Nehru Bazaar Branch, Jaipur.
v RSCB has been awarded at national level by NAFSCOB for its performance in
the year 1994-95, 1996-97, 1997- 98, 1998-99, 2000-01, and 2001-02 to 2002-
03.
v RSCB is the playing dividend regularly to its Shareholders and maximum
dividend permissible as per Cooperative Societies Act,i.e, 10% was paid during
the year 2000-01 to 2002-03, 8.35 & 8.85% during the year 2003-04 to 2005-06
respectively.
ole of NABARRD
also known for its 'SHG Bank Linkage Programmed'
which encourages 1. Serves as an apex financing agency for the
institutions providing investment and production credit for promoting the various
developmental activities in rural areas
2. Takes measures towards institution building for improving absorptive capacity
of the credit delivery system, including monitoring, formulation of rehabilitation
schemes, restructuring of credit institutions, training of personnel, etc.
3. Co-ordinates the rural financing activities of all institutions engaged in
developmental work at the field level and maintains liaison with Government of
India, State Governments, Reserve Bank of India (RBI) and other national level
institutions concerned with policy formulation
4. Undertakes monitoring and evaluation of projects refinanced by it.
NABARD's refinance is available to State Co-operative Agriculture and Rural
Development Banks (SCARDBs), State Co-operative Banks (SCBs), Regional Rural
Banks (RRBs), Commercial Banks (CBs) and other financial
institutions approved by RBI. While the ultimate beneficiaries of investment credit can
be individuals, partnership concerns, companies, State-owned corporations or co-
operative societies, production credit is generally given to individuals.
NABARD has its head office at Mumbai, IndiaNABARD operates throughout the country
through its 28 Regional Offices and one Sub-office, located in the capitals of all the
states/union territories. Each Regional Office[RO] has a Chief General Manager
[CGMs]as it's head, and the Head office has several Top executives like the Executive
Directors[ED], Managing Directors[MD], and the Chairperson. It has 336 District Offices
across the country, one Sub-office at Port Blair and one special cell at Srinagar. It also
has 6 training establishments.NABARD is India's banks to lend to self-help groups
(SHGs). Because SHGs are composed mainly of poor women, this has evolved into an
important Indian tool for microfinance. As of March 2006 2.2 million SHGs representing
33 million members had to been linked to credit through this programmer.
Organizational Setup
Presently power of Board of Director are Vested in Administrator who is appointed
by the State Government. The Chief Executive Officer of the Bank is designated as
Managing Director and is an officer drawn on deputation from State Govt. One General
Manager and 5 Dy.General Managers are there to assist M.D in day in day
management .The bank has 5 departments at HO level which are:
1. Administration &Personnel (A&P)
2. Operation (Opr.)
3. Planning & development(P&D)
4. Accounts & Finance (A&F)
5. Inspection & Supervision (I&S)
6. Training.
2.6 7P’s Of APEX Bank
Place: - In the dynamic market of housing loans the distribution channels and the
increased penetration has emerged to be new mantra of success. The APEXBANKhas
realized that and is offering the housing loan counseling at the doorstep of customer
through its DSE s, also AXIS BANK is trying to exploit some innovative distribution
channels like builders and property brokers who can direct their customers towards
APEX
Promotion: -This is the weakest link in the whole chain, although APEX BANKis trying
to educate the customers about the various kinds of services available in this sector
through property fair etc, it is not doing things at pace fast enough to meet the
requirements of market.
Price: - Although APEX BANK offers the highest interest loan in the market but still it is
one of the major players in the market, the reason being APEX BANK wants to
differentiate itself over service level provided, moreover it does not involve itself in short
term gimmicks like waving the processing fees but instead charging the interest for the
one extra month by starting the installment late, while such practices are very common
in the market among competitors.
Physical environment: -APEX BANK tries to project itself as customer caring
company, so the physical environment is designed accordingly, there is always enough
space to sit and relax, the furnishing is good and there are no physical barriers between
the employees and the customers that is the desks of frontline employees do not have
raised physical barriers.
Process: -The processes OF APEX BANK are scientifically designed and the paper
work requirement is made clear to the customers in the beginning itself, as soon as the
frontline staff gets all the documents, the file of customer moves in a sequential way, is
evaluated by the technical staff and finally the loan is processed in as short time as 24
hours.
People: -The service perception is largely formed by the customer based on the
moments it interacts with its frontline staff, the organization make sure the staff is
courteous polite and helpful to customer thus enhancing the brand value of APEX
