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At The Patiala Central Cooperative Bank Ltd. (Branch Gurbax Colony Patiala )
A Report Submitted to Punjabi University in Partial Fulfillment of the Requirements for the Degree of
Master of Business Administration (2009-2011)
Submitted By: Uni.Roll No: Sushil Kumar
VIDYA SAGAR COLLEGE OF MANAGEMENT & TECHNOLOGY
(AFFILIATED TO PUNJABI UNIVERSITY PATIALA)
I hereby declared that the project entitled “Loan Procedure and Schemes ”, A study conducted at The Patiala Central Cooperative Bank Limited Branch Gurbax colony Patiala is an original work carried out by me under guidance of Lect. Ms.Gazzal , submitted in the partial fulfillment of Master of Business Administration and this has not been submitted in part or full towards any other degree or diploma. Signature Date: july 30 2010 Ankush Kumar
Signature Ms Gazzal (Project Guide)
Thanks to the almighty for showering his blessing on completion of my project. I want to thanks all the employees of the Patiala Central Co-operative Bank Ltd. (Patiala) for their cooperation in successfully completion my project works on P.C.C.B. I am very thankful to all employees of Gurbax colony Branch for their co-operation. I am thrilled to find that people here were very co-operative and helped me in all possible ways I am especially thankful to Mr. Karam Chand (Assistant Manager) who is one of the busiest people for giving me actual knowledge about the successful banking, detail knowledge of Loan Procedure, Loan Schemes and giving me time out of his precious schedule.
I would also like to thank to MsGazzal who encourage me time to time and guide me for the completion of my project. At last but not least, I also thanks to all those persons who gave me every necessary knowledge and their heartily help in completion of my project work.
2 – 38
2 – 15
CHAPTER – I : - INTRODUCTION
Introduction to Banking Industry
o o o o •
History of Banking Banking Institutions Functioning of a Bank Role of Banking 16 – 38
Introduction to Cooperative Banks
o o o o o o
Features of Cooperative Banks Cooperative Movement in India . A Historical Perspective Cooperative Banking in India Types of a Co-operative Bank Financial Sector Reforms and Credit Cooperatives Banking Sector Reforms and Urban Cooperative Banks
CHAPTER – II : - INTRODUCTION TO PCCB
40 – 56
Introduction to State Level organization 42 – 44 Profile of The Patiala Central Cooperative Bank 44 – 56
Name of Departments Various Branches of PCCB
120 • • • • • • Definition of Loan 61 Importance of Loans in Today's Life What is a Procedure? 63 Importance of Procedure Manuals Loan Procedure 68 – 73 Loan Schemes 74 .o o o o Mission of the Bank: Objectives of Bank Technology Used In Bank Vision CHAPTER – III : .IV: -ANALYSIS OF LOAN PROCEDURE & SCHEMES 61.120 61 – 62 63 – 68 CHAPTER – V : .FINDINGS AND CONCLUSION CHAPTER – VI : .RECOMMENDATIONS BIBLIOGRAPHY 128-129 122-123 125-126 .RESERCH METHODOLOGY • • • • • 58 – 59 Definition 58 Research Design Objective of Study Collection of Data Limitations of Study 58 59 59 59 CHAPTER -.
which accepts deposits that can be withdrawn on demand. payment of foreign bills. With this practice. You will find that some are depositing money at one counter while some are receiving money at another counter. robbery and other accidents. Behind the counters in the office you will see tables and chairs occupied by officers. You will see some employees sitting behind counters dealing with visitors standing in front of them. It also lends money to individuals and business houses that need it. savings were available for use whenever needed. State Bank of India. etc. etc. Saving of money is also necessary for old age and ill health when it may not be possible for people to work and earn their living. Thus. as we know people earn money to meet their day-to-day expenses on food. These are heavy expenses. Banks also render many other useful services – like collection of bills. people were in need of a place where money could be saved safely and would be available when required.I INTRODUCTION Introduction to Banking Industry While walking in the streets of any town or city you might have seen some signboards on buildings with names-Canara Bank. Punjab National Bank. higher education of children. People who wish to borrow money for business and other purposes can also get loans from the banks at reasonable rate of interest. They used to hoard money in their homes. which can be met if some money is saved out of the present income. Bank is a lawful organization. They also need money to meet future expenses on marriage. The necessity of saving money was felt by people even in olden days. house building and other social functions. Banks are such places where people can deposit their savings with the assurance that they will be able to withdraw money from the deposits whenever required. . On one side of the office you will also see a chamber (small partitioned room) where the manager is sitting with papers on his table. but it also involved the risk of loss by theft.CHAPTER . housing. What do these names stand for? Did you ever try to know about them? If you enter any such building you will find some kind of a business office. clothing. education of children. United Commercial Bank. This is the office of a ‘Bank’. Bank.
It not only provides money for the production of goods and services but also facilitates their exchange between the buyer and seller. and so on. Central banking is the responsibility of the Reserve Bank of India. History of Banking Banking industry in India originated in the last decades of the 18th century. which adds to the original amount of deposit. They can keep their earnings from sales safely deposited in banks to meet their expenses from time to time. the government nationalized the six next largest in 1980. banks give interest. Banks also charge interest on loans. It is a great incentive to the depositor. Safety of deposit. Also banks depend a great deal on public confidence. traders and businessmen for productive purposes. On the basis of deposits banks also grant loans and advances to farmers. the Reserve Bank was nationalized and given broader powers. which in 1935 formally took over these responsibilities from the then Imperial Bank of India. Banks accept deposits from the general public as well as from the business community. banking is an important auxiliary to trade. Depositing money in banks and borrowing from banks are legal transactions. certifying the credit-worthiness of business. a government-owned bank that traces its origins back to June 1806 and that is the largest commercial bank in the country. In 1969 the government nationalized the 14 largest commercial banks. Interest received on loan sand fees charged for services which exceed the interest allowed on deposits are the main sources of income for banks from which they meet their administrative expenses. As we may be aware that there are laws which regulate the banking activities in our country. Without public confidence banks cannot survive. The oldest bank in existence in India is the State Bank of India. and b. Therefore. Businessmen have income from sales out of which they have to make payment for expenses. Any one who saves money for future can deposit his savings in a bank. which they render to the business community and public in general.safe-keeping of jewellery and other valuable items. . ‘Banking’ as an activity involves acceptance of deposits and lending or investment of money. It facilitates business activities by providing money and certain services that help in exchange of goods and services. The activities carried on by banks are called banking activity. The rate of interest is generally higher than the rate of interest allowed on deposits. Thereby banks contribute to the economic development of the country and well being of the people in general. It promotes saving habits among the public. Banks are also under the control of government. Banks give two assurances to the depositors – a. whenever needed On deposits. After India's independence in 1947. Banks also charge fees for the various other services. relegating it to commercial banking functions. Withdrawal of deposit. Hence they enjoy the trust and confidence of people.
It was the effort of the then Prime Minister of India. Bank of Bombay (1840) and Bank of Madras (1843) as independent units and called it Presidency Banks. Phase II Government took major steps in this Indian Banking Sector Reform after independence. During those days public has lesser confidence in the banks. Bank of India. and Bank of Mysore were set up. During the first phase the growth was very slow and banks also experienced periodic failures between 1913 and 1948. major process of nationalizations was carried out. There were approximately 1100 banks. Phase II and III Phase I The General Bank of India was set up in the year 1786. Between 1906 and 1913. This step brought 80% of the banking segment in India under Government ownership. The East India Company established Bank of Bengal (1809). the Government of India came up with The Banking Companies Act. To streamline the functioning and activities of commercial banks. Next came Bank of Hindustan and Bengal Bank. Second phase of nationalisation Indian Banking Sector Reform was carried out in 1980 with seven more banks. mostly small. it nationalized Imperial Bank of India with extensive banking facilities on a large scale especially in rural and semi-urban areas. Abreast of it the savings bank facility provided by the Postal department was comparatively safer. 1969.To make this write-up more explanatory. . The following are the steps taken by the Government of India to Regulate Banking Institutions in the Country: • • 1949 : Enactment of Banking Regulation Act. As an aftermath deposit mobilization was slow. These three banks were amalgamated in 1920 and Imperial Bank of India was established which started as private shareholders banks. Moreover. It formed State Bank of India to act as the principal agent of RBI and to handle banking transactions of the Union and State Governments all over the country. Canara Bank. 14 major commercial banks in the country was nationalised. Indira Gandhi. In 1865 Allahabad Bank was established and first time exclusively by Indians. Punjab National Bank Ltd. I prefix the scenario as Phase I. In 1955. Reserve Bank of India was vested with extensive powers for the supervision of banking in India as the Central Banking Authority. 1955 : Nationalisation of State Bank of India. Bank of Baroda. was set up in 1894 with headquarters at Lahore. Mrs. mostly Europeans shareholders. Reserve Bank of India came in 1935. 23 of 1965). funds were largely given to traders. 1949 which was later changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No. Seven banks forming subsidiary of State Bank of India was nationalized in 1960 on 19th July. Central Bank of India. Indian Bank.
1975 : Creation of regional rural banks. 31 private banks (these do not have government stake. With the growth in the Indian economy expected to be strong for quite some timeespecially in its services sector-the demand for banking services.7 per cent that existed between 199495 and 2002-03.2% and 6. the branches of the public sector bank India rose to approximately 800% in deposits and advances took a huge jump by 11.000%. with the private and foreign banks holding 18. The growth in the Indian Banking Industry has been more qualitative than quantitative and it is expected to remain the same in the coming years. they may be publicly listed and traded on stock exchanges) and 38 foreign banks. In 1991. Banking in the sunshine of Government ownership gave the public implicit faith and immense confidence about the sustainability of these institutions.000 branches and 17. Bank assets are expected to grow at an annual composite rate of 13. and asset sales. Time is given more importance than money. That will comprise about 65 per cent of GDP at current market prices as compared to 67 per cent in 2002-03. Phone banking and net is introduced. One may also expect M & As. the public sector banks hold over 75 percent of total assets of the banking industry. Currently. under the chairmanship of M Narasimham. . takeovers. 000/. a committee was set up by his name which worked for the liberalisation of banking practices. 1980 : Nationalisation of seven banks with deposits over 200 crore. Based on the projections made in the "India Vision 2020" prepared by the Planning Commission and the Draft 10th Plan. The country is flooded with foreign banks and their ATM stations. mortgages and investment services are expected to be strong. a rating agency. 90. 1961 : Insurance cover extended to deposits.• • • • • • 1959 : Nationalisation of SBI subsidiaries. It is expected that there will be large additions to the capital base and reserves on the liability side.27 public sector banks (that is with the Government of India holding a stake). especially retail banking. the report forecasts that the pace of expansion in the balance-sheets of banks is likely to decelerate. After the nationalisation of banks. 1971 : Creation of credit guarantee corporation. India has 88 scheduled commercial banks .000 ATMs. According to a report by ICRA Limited.4 per cent during the rest of the decade as against the growth rate of 16. They have a combined network of over 53. The total assets of all scheduled commercial banks by end-March 2010 is estimated at Rs 40. Phase III This phase has introduced many more products and facilities in the banking sector in its reforms measure.5% respectively. The entire system became more convenient and swift. 1969 : Nationalisation of 14 major banks. Efforts are being put to give a satisfactory service to customers.crores.
1949 defines Banking as "accepting. Lending money to public (Loans) 3. Banks essentially perform the following functions: 1. for the purpose of lending or investment of deposits of money from the public. which started in 1991 has cleared the cobwebs somewhat but a lot remains to be done. Banking Regulation Act of India. The process of financial reforms. governments in most countries regulate this sector rather stringently. order or otherwise. The multiplicity of policy and regulations that a Bank has to work with. Accepting Deposits from public/others (Deposits) 2. repayable on demand or otherwise and withdrawal by cheques. attempts to give an overview of the functions in as simple manner as possible. which is also intended for banking professional. where NPAs are of a very high order. Since Banking involves dealing directly with money." Deriving from this definition and viewed solely from the point of view of the customers. draft.Banking Institution Functioning of a Bank Functioning of a Bank is among the more complicated of corporate operations. the regulation traditionally has been very strict and in the opinion of certain quarters. sometimes bordering on illogical. responsible for the present condition of banks. Transferring money from one place to another (Remittances) . makes its operations even more complicated. In India. This section.
Let us see what the Banks must maintain to provide this service • • • • • • An effective branch network to reach the targeted customer base A system of Intra branch accounting with separate account(s) for each customer A system of reconciliation at the end of the day Availability of adequate funds at each branch Trained staff for effective customer service Infrastructural inputs like space. Government business Banks are organized in a linear structure to performed these activities at the base of which lies a Branch. comfortable environment etc.both domestic and foreign.from one place . Accepting deposits is one of the two major activities of the Banks Banks are also called custodians of public money. Skills to follow up and monitor the end-use of money lent by it. Banks also carry out.. But since the Banks use this money to earn interest from people who need money. Review of credit portfolio. This activity places its own requirements on the resources of the Bank. Legal skills for recovery of its dues through the courts. the Bank acts as an intermediary between the people who have the money to lend and those who have the need for money to carry out business transactions. the money is accepted as deposit for safe keeping. Skills to appraise the potential borrowers and the activity. Acting as trustees 5. stationery. An effective credit delivery system. However. Basically. Keeping valuables in safe custody 6. For effective functioning of this. In a way. The corporate office of a bank is normally called Head Office. Legal skills for documentation. a bank must possess: • • • • • • • Sufficient deposits. on behalf of their customers the act of transfer of money . accepting deposits and keeping track of the money involves a lot of book-keeping and other operations. Remittance Apart from accepting deposits and lending money.4. Lending money to the public Lending money is one of the two major activities of any Bank. Banks share a part of this interest with the depositors.
Banks must possess the following to be effective and retain that: • • • A track record of sufficient length. Such entity necessarily have to have expertise in financial matters and also be of sufficient standing in the market/society to generate confidence in the minds of potential subscribers to the debenture. the Bank must provide: • • • • Physical structures to house the lockers Locker cabinets Security arrangements Record of access to lockers Government Business . Banks also have the facility of quick transfer of money also know as Telegraphic Transfer or Tele Cash Orders. These are stored in the Bank's Strong Room and are fully secure. A system of Inter branch reconciliation A system of reconciliation with the correspondents Availability of funds at all the centers Trustee Business Banks also act as trustees for various purposes. security of valuables is provided through making secured space available to general public for keeping these valuables. Facilities for safe keeping. For example. The latter are small compartments with dual locking facility built into strong cupboards. To make this facility available to its customers. it has to appoint a financial intermediary as trustee who takes charge of the security for the debenture and looks after the interests of the debenture holders. Both must come together and use their respective keys to open the locker. Money Orders etc. a Bank must have: • • • • An effective branch network or correspondent relationships. These spaces are available in the shape of LOCKERS. While Banks are the natural choice for the customers.to another. Lockers can neither be opened by the hirer or the Bank individually. While security of money is taken care of through offering various type of deposit schemes. Banks issue Demand Drafts. This activity is known as "remittance business" . Banker's Cheques. To deliver this service. whenever a company wishes to issue secured debentures. Legal skills to take necessary steps for the trusteeship Safe Keeping Bankers are in the business of providing security to the money and valuables of the general public. for transferring the money.
automobiles. Let us know about the role of banking. small-scale industries and self-employed people as well as to large business houses which lead to balanced economic development in the country. stationery etc. In India. However.Earlier Government business used to be exclusively carried out by Government Treasuries where all type of transactions took place. houses. Co-operative banks are regulated by the . The Banks must provide: • • • • Interface with the public Liaison with local government departments and government treasury Arrangement for reconciliation with the Government Accounts Department Necessary infrastructure. It acts as an intermediary between people having surplus money and those requiring money for various business activities. besides professional and salary classes. While the Banks carry out this business for a fee to be paid by the Government. It also facilitates import export transactions. It facilitates business transactions through receipts and payments by cheques instead of currency. Cooperative banks perform the main banking functions of deposit mobilisation. They provide limited banking products and are specialists in agriculture-related products. etc. They play a significant role in the economy of a nation. It helps in national development by providing credit to farmers. now Banks act on behalf of the Government to accept its tax and non tax receipts. It provides loans and advances to businessmen for short term and long-term purposes. It helps in raising the standard of living of people in general by providing loans for purchase of consumer durable goods. co-operative banks finance small borrowers in industrial and trade sectors. to cater to the numbers Role of Banking Banks provide funds for business as well as personal needs of individuals. providing this service requires a lot of effort and organisation. • • • • • • • It encourages savings habit amongst people and thereby makes funds available for productive use. supply of credit and provision of remittance facilities. Introduction to Cooperative Banks Co-operative banks are small-sized units organised in the co-operative sector which operate both in urban and non-urban centers. Most of the Government disbursements like pension payments and tax refunds also take place through banks.
The scheduled UCBs. one vote". and metropolitan areas also. governmentsupported. The sources of funds for co-operative banks are: central and state government. The urban and non-agricultural business of these banks has grown over the years. and government-subsidized financial agency in India. no loss" basis.Reserve Bank of India and governed by the Banking Regulations Act. Co-operative bank performs all the main banking functions of deposit mobilization. do not pursue the goal of profit maximisation. Co-operative banks. Rural co-operative banks are regulated by state registrar of co-operatives. borrowings and credit also form a significant part of assets and liabilities of co-operative banks Features of Cooperative Banks • • • • • • Co-operative Banks are organised and managed on the principal of co-operation. Reserve Bank of India and NABARD. supply of credit and provision of remittance facilities. as a principle. Intra-sect oral flows of funds are much greater in cooperative banking than in commercial banking. Co-operative bank do banking business mainly in the agriculture and rural sector. from urban to rural. For commercial banks. can lend upto Rs 3 lakh for housing purposes. co-operative banks now provide housing loans also. other co-operative institutions. self-help. ownership funds and deposits or debenture issues. 1949. and mutual help. SCBs. the Reserve Bank of India is lender of last Cooperative Movement in India . The UCBs can provide advances against shares and debentures also. and Banking Laws (Co-operative Societies) Act. However. UCBs provide working capital loans and term loan as well The State Co-operative Banks (SCBs). They get financial and other help from the Reserve Bank of India NABARD. 1965. function on "no profit. They function with the rule of "one member. However. Central Co-operative Banks (CCBs) and Urban Co-operative Banks (UCBs) can normally extend housing loans upto Rs 1 lakh to an individual. UCBs. Inter-bank deposits. The co-operative banks demonstrate a shift from rural to urban. and CCBs operate in semi urban. Co-operative Banks provide limited banking products and are functionally specialists in agriculture related products. however. central government and state governments. while the commercial banks. They constitute the "most favored" banking sector with risk of nationalization. urban. A Historical Perspective . Co-operative banks are perhaps the first government sponsored.
with a membership of more than 200 million. In fact. irrigation. Of the primary (village) level cooperatives. housing. Cooperatives supply about 46 percent of the total rural credit (including agricultural credit). the year in which India attained freedom. dairy and sugar cooperatives have made India a major nation in the world with regard to milk and sugar production. India can claim to have the largest network of cooperatives in the world numbering more than half a million. which examined the problem of rural credit subsequently. around 28 percent with 137 million memberships are agricultural cooperatives.Raiffeisen. distribution/marketing. dealing directly or indirectly with agricultural sector. The policy of the Government towards the cooperative movement was guided by the recommendations of the Saraiya Committee. transport. production. The cooperative network in the country is rather strong covering all the villages in the country and more than 67 percent of the households have been brought under the cooperative hold. During the last century. the cooperative movement has entered several sectors like credit. summed up its findings in the celebrated dictum that . The state patronage to the cooperative movement continued even after 1947. that in the Indian context. respectively. Today. after a detailed examination of the entire gamut of issues including the social ethos of rural society..the cooperative society has an important role to play as the most suitable medium for the democratization of economic planning. paving the way for the establishment of cooperative credit societies in rural and urban areas on the patterns of . processing. account for 36 percent of the total distribution of . have come to the same conclusion.cooperation has failed. and Schulze Delitzch. which stated that . banking. The Rural Credit Survey Committee (1954). textiles and even industries. The Cooperative Societies Act of 1912 recognized the formation of non-credit societies and the central cooperative organizations/federations. the Cooperative Credit Societies Act was passed in 1904.The Indian cooperative movement. The independent India accepted the concept of planned economy and cooperative organizations were assigned an important role. the first comprehensive enquiry into problems of rural credit. without exception. Since 1950s.. there is no alternative from the point of view of structural appropriateness. Various expert committees. Based on the recommendations of Sir Frederick Nicholson (1899) and Sir Edward Law (1901). the cooperatives in India have made remarkable progress in the various segments of Indian economy. but cooperation must succeed. warehousing. like its counterparts in other countries of the world has been essentially a child of distress. to cooperatives at the village level.
Understandably. (ii) poor resource mobilization. 2. The acknowledged operational deficiencies of the cooperative credit structure have been (I) weak recycling of credit. The upwardly transmission of the weaknesses of the primary societies have affected the capabilities of the higher level cooperative federations in so far as their usefulness to the former is concerned. In some areas like dairy. this has resulted in weakening of the cooperative edifice. Governments and policy makers have paid more attention to agricultural cooperatives and thus. certain glaring defects have also developed in the movement. urban banking and sugar. The agricultural credit cooperative system in general has become rather over dependent on external support in terms of participation in share capital by Government and refinance from Government owned Financial Institutions. The following are the unique features of Indian cooperative movement:1. Paradoxically. the growth and development of the Indian cooperative movement is heavily tilted in favour agricultural cooperatives in general and in particular. 3. Though cooperative movement has made remarkable progress in several areas. 6. is a state initiated movement. their increasing officialization and politicization culminating in virtually depriving the cooperatives of their vitality as well as their democratic and autonomous character. have made majority of the cooperatives at the primary level almost moribund. 4. in a way. Dormant membership. 5. (iii) ineffective lending and (iv) poor recovery. undue political and bureaucratic intervention. perhaps. . Historically. defeating the very objectives of these institutions. curiously. produce about 55 percent of the total sugar and constitute for 28 percent of the rural fair shops (distributing consumer articles). although the quantitative expansion has been somewhat satisfactory. The state partnership is.5 percent of the total . which have been. As of today.fertilizers. lack of active participation of the members in the management. the movement continues to suffer from structural defects and operational deficiencies. credit cooperatives. the unique feature of the Indian cooperative movement. Government contribution to the share capital of primary agricultural cooperatives accounts for about 7. The cooperative credit movement in modern India. With regard to agricultural cooperative credit structure. lack of professionalism (and absence of corporate governance). the cooperatives have achieved success to an extent but there are larger areas where they have not been so successful. the state partnership which was conceived as a measure for strengthening the cooperative institutions had paved the way for ever-increasing state control over cooperatives.
Interestingly. District Co-operative banks and the Primary Agricultural Co-operative societies. The rural credit cooperatives may be further divided into short-term credit cooperatives and long-term credit cooperatives. In this category there are again three sub categories of banks which are the State Co-operative banks. It may be mentioned that DCCB and SCB are the federal cooperatives and thus the objective is to serve the member cooperatives. . In other words. only these banks are licensed to conduct full-fledged banking business. The organizational structure of the credit cooperatives in India is illustrated in chart I.000 Primary Agricultural Credit Societies (PACS) dealing directly with the individual borrowers.Cooperative Banking in India Credit cooperatives are the oldest and most numerous of all the types of cooperatives in India. Types of a Co-operative Bank There are two types of co-operative banks in India. some states in the country have unitary structure with state level cooperative operating with through their own branches and in one state an integrated structure prevails. With regard to short-term credit cooperatives. The cooperative credit institutions in the country may be broadly classified into urban credit cooperatives and rural credit cooperatives. At the central level (district level) District Central Cooperative Banks (DCCB) function as a link between primary societies and State Cooperative Apex Banks (SCB). the long-term cooperative credit structure has two tiers in many states with Primary Cooperative Agriculture and Rural Development Banks (PCARDB) at the primary level and State Cooperative Agriculture and Rural Development Bank at the state level. District Central Cooperative Banks and select Urban Credit Cooperatives are qualified to be called as banks in the cooperative sector. only State Cooperative Apex Banks. The first is the short term lending oriented Co-operative Banks. As against three-tier structure of short-term credit cooperatives. at the grass-root level there are around 92. However. There are about 2090 urban credit cooperatives and these societies together constitute for about 10 percent of the aggregate banking business and therefore regarded as an important segment of the banking system. under the Banking Regulation Act 1949. The urban credit cooperatives are also popularly known as Urban Cooperative Banks.
and the sector is dominated by the banking sector which accounts for about two-thirds of the assets of the organized financial sector. 4. Again the Co-operative banking structure in India is divided into five main categories and these categories are: 1. 5. It may be mentioned that the structural reforms in the trade regime and industrial and financial policies have been given utmost priority in order to ensure macroeconomic stability. Primary Urban Co-operative Banks. the second is district level. and the third is the village level. Land Development Banks. First is the state level. Without the help of co-operative banks. The financial system in India has built up a vast network of financial institutions and markets over time. District Central Co-operative Banks. millions of people in India would be lacking the much needed financial support Financial Sector Reforms and Credit Cooperatives: The process of economic and financial sector reforms were initiated in 1991. A healthy financial system being the principal pre-requisite for the globalization process. allowing market forces to improve efficiency and ensuring outward orientation to the economy for bringing about a higher degree of integration of the Indian economy with the rest of the world. The objectives of the reform program have been to remove the structural constraints in the factor and product markets. In this second category there are land developments banks which are at three levels. the banking sector being an important component thereof came into sharper focus. It is very much clear that co-operative banks have very much importance in national development. as a step towards a broader process of international economic integration and globalization of financial markets. 2. State Co-operative Banks. 3.The second is the long term lending oriented Co-operative banks. The first phase of the . Primary Agricultural Credit Societies.
The broad features of the on going banking reforms have been. competition and transparency. an important component of the banking system was a natural corollary as the weaknesses in cooperative segment could pose systemic risks. The impact of the extension of prudential standards to cooperative banks has resulted in an increased intervention by the regulator and the Government in the name of the financial regulation/supervision. the banking sector reforms could be treated as complete only if it encompasses the cooperative segment. Though cooperative banks operate at the district and state level. yet non-disruptive manner has given the confidence to launch what has been described as the second generation or second phase of reforms especially for the banking sector. deregulation of interest rates. 1992). the urgency and importance for extension of the reforms need hardly be emphasized keeping in view of their reach and scale of operations. assistance to banks in debt recovery and reforms in money and forex markets. Thematic Framework for Analysis: The literature relating to the economic reforms. cooperative reforms encompassing legal and administrative aspects have not taken place in India. income recognition.current reform of the financial sector was initiated in 1992 based on the recommendations of the Committee on Financial System (CFS. banking reforms and its impact on credit cooperatives and so on are rather opulent. In . This apart. asset classification and provisioning norms were made applicable to cooperative banks in a phased manner. particularly prudential standards to cooperative banking institutions. improving the quality of supervision. The extension of reforms. partial removal of selective credit controls. The progress that has been made in a substantial. Therefore. This is on account of multiplicity of controls (administrative aspects including registration are under State Cooperative Acts whereas financial supervision and regulation is with the Central Bank of the country). However. the succinct objective of the banking sector reforms has been to improve the efficiency in the system by introducing an element of competition. impact of reforms on cooperative sector. needless to mention. tightening of prudential standards. Accordingly. enabling the latter to function on sound lines at par with other banking institutions. The report of the Committee on Banking Sector Reforms (CBSR. 1998) provides a framework for the second phase of reforms in the banking system. prudential standards covering capital adequacy. gradual removal of pre-emptions (reduction in CRR and SLR).
it is attempted to maintain a special thrust on the cooperative character of UCBs. in practice. . Using this normative analytical framework. b) Urban Cooperative Banks (falling under Banking Regulation Act of 1949) are more influenced by banking sector reforms in the short-run than other credit cooperatives. which is different from the one usually used for capturing the impact of reforms on cooperatives. be it in credit or non-credit segment. Thus. a) Banking sector reforms essentially refers to the guidelines/directions from the regulator (central bank of the country) and the Government during the last ten years. even if one attempts. However. While the difficulties in examining the impact of reforms on the cooperative character of cooperatives are quite understandable. Ramesha (1996) in his empirical study points out that Self Help Groups (SHGs) which are not registered as cooperatives are. What is required perhaps is a normative analytical framework. it does not mean the same can not be attempted meaningfully. And this is particularly true in India. It seems the cooperative researchers. much more closer to cooperative principles than cooperatives themselves. particularly doctoral students are more concerned with the assessment and measurement of the impact of reforms on the performance of cooperatives using a definite and quantifiable parameters. Given the diversity that prevails today in the cooperative sector and the levels of reforms thereof. For the sake of research. all through the discussion. the conclusions could be abstruse. in the present paper an attempt is made to evolve a conceptual framework for further research concerning Urban Cooperative Banks (UCBs) in India against the backdrop of banking sector reforms. a general discussion on the impact of reforms (economic or banking sector) on cooperative character would be almost impossible.so far as the impact of reforms on the cooperative character of the cooperatives is concerned. c) Cooperative character of urban cooperative banks can be captured in terms of the adherence to cooperative principles. one may safely say that neither the policy makers nor the researchers have shown any serious interest. The analytical framework for the aforesaid purpose rests on three basic assumptions.
although owned fund. were essentially credit societies but later converted themselves into urban cooperative banks. the gross Non Performing Assets (NPAs % to total advances) during the same period went up from 16 to 22 percent (3). then the scenario undergoes a complete change. deposits and advances of urban cooperative banks increased somewhat impressively. in the early part of the last century. many urban cooperative credit societies. In so far as the growth and performance are concerned. between 2001 and 2002. is used to denote that the urban cooperative banks perform the role of a primary unit in a 3-tier cooperative credit structure.1 lakh (0. Accordingly. The percentage of the profit making urban cooperative banks to the total stood at 87 percent as at the end of March 31. it may be mentioned that the urban cooperative banks were a shade better than the scheduled commercial banks and public sector banks till 1999 (Ramesha K. However. (ii) the paid up share capital and reserves of which are not less than Rs.e. This is partly on account of historical reasons and partly due to the preferential treatment of cooperative structure in general. an urban cooperative bank was defined as a Primary Cooperative Bank other than a primary agricultural credit society. i. On the whole. which were not engaged in any banking functions. the performance of the urban cooperative banks particularly after 2000 has been on the decline. If one benchmarks the growth and performance of urban cooperative banks with that of the banking industry (which is dominated by public sector banks) after 2000 and onwards. There was no well-defined concept of urban cooperative bank till 1996.084 urban co-operative banks with 7. it has to be recognized that the prudential standards and regulatory system prescribed for urban cooperative banks were relatively soft in comparison with those of commercial banks.primary. has a network of 2. by 27.1 Mn) and (iii) the by-laws of which do not permit admission of any other cooperative society as a member. Over a century old urban cooperative credit movement today. 15 and 14 percents respectively. For instance. The deposits and advances of urban cooperative banks constitute for about 9 and 8 percents of the aggregate deposits and advances of the banking system respectively.bank. when banking laws (provisions of section 5(CCV) of Banking Regulation Act 1949) were made applicable to cooperative banks. urban cooperative credit societies were organized on community basis and their lending operations were confined to meeting the consumption oriented credit needs of their members.368 branch outlets spread all over the country. The word . Interestingly. 2001).Urban Cooperative Banks in India Inspired by the success of urban cooperative movement in Germany and Italy. and a host of factors may be responsible for this which may include increasing competition. also used the word . (i) the primary object of which is the transaction of banking business. 2002. tightening prudential standards and . which were organized initially. Many urban cooperative banks..
The average size of the loan also works out to be relatively low and an overwhelming segment of UCBs have been able to comply with the priority sector lending targets (directive from central bank to lend to certain sectors like small enterprises.. 1) Urban cooperative banks are registered under Cooperative Societies Act of the respective state Governments. Five states account for 80 percent of the total UCBs in the country and one of them accounts for as high as 32 percent of the total UCBs. trade & business. UCBs have been supporting federal units (District Central Cooperative Banks and State Cooperative Banks) by keeping their surplus resources in the form of deposits. 2) The discernible characteristic feature of UCB structure is its heterogeneity. Banking Sector Reforms and Urban Cooperative Banks: The reform measures as applicable to UCB sector may be classified into three broad . Nearly 50 percent of the banks are unitary in nature (with single branch banking). Unlike the agricultural cooperative credit structure. 5) A noticeable feature of urban banking sector is its financial independence. The larger UCBs (scheduled UCBs) numbering just 51 accounts for more than 40 percent of the business from UCB sector as against 800 UCBs accounting for just 6 percent.duality of control. Managerial/Administrative aspects of UCBs continue to remain with the state Governments. housing etc) set by the central bank of the country. 4) Urban cooperative credit movement in general. Heterogeneity in their size is another facet of the UCB structure. multiple control. The Union Government regulates the UCBs having multi-state presence and such banks are registered under Multi-state Cooperative Societies Act. The Reserve Bank of India (Central Bank of the country) is the regulatory and supervisory authority for UCBs for their banking related operations.supervision and regulatory standards. In fact. etc. Following are the features of urban cooperative credit banks in India. the urban cooperative banks are not surviving on external assistance such as refinance support. Controlling of UCBs by state Government and the Central Bank of the country is generally known as . and the number of UCBs in particular is concentrated in few states. 3) UCB structure is exemplified by its pronounced focus on the needs of small men and micro credit sector.
The influence of the reforms on the functioning as well as the cooperative character of UCBs is discussed below. in 1993. it is not yet clear.categories. Prudential Standards: To begin with. legislative frame work and more broadly. RBI introduced Income Recognition and Asset Classification Norms to UCBs. like the latter. to . To put it differently. these banks will have to start dealing with non-members (or nominal members) on a large scale and perhaps may have to shift from . albeit in a phased manner. prescription of a minimum capital the urban cooperative bank (to conduct banking business) may seem to be justified from the viewpoint of ensuring stability in the financial system. whether the prudential standards prescribed for commercial banks would work without distorting the cooperative character of UCBs. While the promotion of prudent financial practices has become a sine quo non in the highly competitive globalize environment (for safeguarding the financial health of the system. If one looks at a cooperative credit society/bank. income recognition and provisioning norms). capital is widely regarded as a measure of the risk taking ability of a financial intermediary and therefore. it should not be forgotten that such standards were contrived essentially for commercial banks. the temptation to prescribe universally valid model codes which do not allow for differences in institutional development. First.profit. in a phased time frame. Although. Subsequently. It is worth mentioning that in India. in particular from UCB sector. different stages of development must be avoided. in particular of the UCB sector). In 1995. For instance. Although. Lastly. while there is no dispute that UCBs should be subjected to prudential standards (capital adequacy. policy initiatives have been introduced (through Monetary & Credit Policies) to contain the systemic risk emanating from cooperative sector. asset classification. while recognizing the differences between commercial and urban cooperative banks. are not permitted to .surplus. as it is happening in India. the capital adequacy norms (capital to risk weighted asset ratio) were also made applicable to UCBs. steps are also being initiated to professionalize the management and manpower of UCBs. urban cooperative banks though on par with commercial banks with regard to prudential standards. the focal point of the reforms has been prudential norms. If capital base is to be strengthened.. then possibly the members (generally with limited means) may not be able to raise the required capital. a majority of the prudential norms introduced for commercial banks are being extended to UCBs. the prudential exposure norms to single/group borrowers were also made applicable to them. duality/multiplicity of control has been recognized as an irritant to their effective regulation and supervision. The need to increase the deposit base as also to gainfully employ the funds generated have made it necessary to have a large number of customers who are not the members. the notion of a code of good practices is intuitively appealing. Second. as a typical cooperative created on the basis self help and mutual help.
While this is to some extent true. Fifthly. credit. It is disheartening to note that the . interests (majority of them are not the members) in the case of urban cooperative banks. Thirdly. needless to mention. Professional Management and Governance: Good corporate governance is critical to efficient functioning of an entity and more so for a banking entity. the regulator’s frequency (as also scope) of intervention increases thereby affecting the cooperative character. investment.boost their capital base through sub-ordinate debts. the former may have to progressively imbibe the character of the latter (identity crisis?). There could be several such dimensions as discussed above. However. In this regard. the solution to this problem certainly is not Government intervention as it would seriously impair the cooperative character. there are ceilings on the value individual share holdings have not been revised since long. Further. is the dilution in the cooperative character (in terms of adherence to the principles). prevents the birth of new credit cooperatives and constrain the existing societies in so far as the expansion is concerned. in India regulator’s intervention has indirectly infringed upon the functional autonomy covering areas like share-linkage. The framework for good governance and professional management in cooperative sector should essentially emanate from the guiding principles and the given legal framework in different countries/states. Secondly. membership prescription as it prevails in India. deposit and so on. in India it is not uncommon that the cooperative banks are superseded and Government officials are posted to head or nominated on the board and unfortunately this trend is increasing in the post reform period. Thus. the strict entry norms in terms of minimum capital. Thus the need for professional management and healthy governance practices in urban credit cooperative societies/banks in the present competitive environment needs no emphasis. Quite often the reason quoted is that there is lack of qualified and competent directors and the protection of depositors. Fourthly. The cost. While one can not remain ignorant of the role of the Government in the promotion of and development of cooperation in India. in order to ensure the adherence to the prudential standards by cooperative credit societies/banks. whether a cooperative or a commercial bank (irrespective of its size). in the name of protecting the interests of the depositors (majority of whom are not the members of cooperative banks). prescribing the number and qualification of the nominee directors would no doubt impair the cooperative character. with the introduction of same prudential standards the difference between urban credit cooperatives/banks and commercial banks get blurred and possibly. not only prudential standards are extended but even the professional content in the management committee of the urban cooperative credit societies/banks is also stipulated in India by the regulator/Government. the human resource comprising of paid staff and elected management has to be highly competent. Nonetheless. it appears that the benefits of the prudential standards to urban credit cooperatives/banks come at a cost. for managing a financial intermediary.
21 % of the District Central Cooperative Banks and 8% of Primary Cooperative Agricultural and Rural Development Banks stood superseded as on March 2000. in the case of co-operative banks it requires the intervention of the Registrar of Cooperative Societies (state Government). As per the prevailing act (and according to the cooperative philosophy/principles) any individual member can get himself/herself elected to the management committee of a cooperative bank. Moreover. Asset-Liability Management and so on. the duality of control not only affects the quality of supervision and regulations. meaning that the administration related aspects are being supervised and regulated by State Government and the banking operations are supervised and regulated by the central bank of the country. marketing plan/strategy. In this regard. Thus. investment management. it is doubtful whether the elected management (as per the existing provisions of cooperative act and principles the individuals without sufficient knowledge/experience in financial markets or management can be at the helm of affairs of a cooperative bank) would be able to take on the emerging challenges. the central bank of the country is not in a position to effectively supervising them. Supervision and Regulation: At present in India. urban credit cooperatives/banks are subjected to duality of control. More than 200 urban cooperative banks are identified as weak/sick banks by the regulator as at the end of March 2002.elected management of 41 % of State Cooperative Banks. a clearcut demarcation of the financial and administrative areas for regulation is almost impossible and even if it is possible it surely acts as an impediment in effective supervision. 37 % of State Cooperative Agricultural and Rural Development Banks. While the central bank of the country has the wherewithal under the Banking Regulation Act for dealing with crucial aspects of functioning of commercial banks. Given this. the need of the hour is to ensure that in cooperative organizations. It is this management committee which is entrusted with the responsibilities like risk management . Given the number of urban credit cooperatives/banks. Perhaps.policy/strategy. understandably resulted in overlapping jurisdiction of the state Government and the central bank of the country. the following issues/areas may be of some interest to the cooperative researchers. It should also be noted that the very concept of banking (financial inter-mediation) is undergoing change in the present competitive environment and the conventional framework for management with which cooperative banks are comfortable may not be sufficient. credit and NPA management. the system of governance including the size and composition of the board of directors (or elected management) is driven by the purpose and objectives of the business. but also the functioning of the urban cooperative . This has.
Although the promotion of prudent financial practices in urban cooperative banks has become a sine quo non in the present competitive environment. it is yet not clear as to whether the same would ensure soundness and stability in the cooperative banking segment. It seems the extension of reforms/prudential standards to urban cooperative banking has provided substantial scope for the external intervention and in the process. . Logically. The framework for such research should essentially be within the guiding principles of cooperation. affecting the cooperative character in terms of adherence to the cooperative principles. However. different stages of development must be avoided. With regard to the extension of reforms to cooperative banking segment. more important amongst them are prudential standards. legislative framework and more broadly. professional management & governance and supervision & regulation. some of them may be good for research as well. if cooperative character of credit cooperatives is to be preserved. system of governance and supervision & regulation all should emanate from the guiding principles of cooperation. There are some areas of concern. then there would not be any difference worth mentioning between these entities. the movement can not be termed as a vibrant one in regard to cooperative values and philosophy as enunciated in cooperative principles. the temptation to prescribe universally valid model codes which do not allow for differences in institutional development.banking sector. in the long run. Needless to mention. if the prudential standards. and supervision and regulation for cooperative banks were same as that of commercial banks. There are several areas that need the intervention of researchers and perhaps. and the cooperative banking in particular has been rather appreciable. It must not be forgotten that the notion of a code of good practices though intuitively appealing. While the progress of the cooperative movement in India in general. one can not afford to ignore that such practices were contrived essentially for commercial banks. the prudent practices. under this regime of duality of control the urban cooperative banks may turn out to be neither cooperative nor commercial banks.
The bank was established to help to provide timely and adequate flow of credit to the farmers for agriculture and allied activities through PACS. Besides this. In 1951 its Head Office was shifted to Jalandhar from where it moved in 1963 to its present building at Chandigarh. It has 3 Divisional Offices in Punjab at Amritsar. The organizational structure is as under:- .CHAPTER – II INTRODUCTION TO THE PATIALA CENTRAL COOPERATIVE BANK LIMITED Introduction to State Level organization The Punjab State Cooperative Bank was established on 31st August. the position of the Punjab State Cooperative Bank is extremely important as the whole credit system revolves around it. 720 has a principle financing institution of the cooperative movement in Punjab. In the cooperative Banking structure. 1949 at Shimla vide registration No. Jalandhar & Bathinda. Bhatinda and Jalandhar. It has 3 Divisional Offices at Amritsar. Organizational Structure The bank operates in the city of Chandigarh having 19 branches and 3 extensions Counters. there are 19 District Central Cooperative Banks having 783 branches and 16 extension counters in the State of Punjab affiliated with it. It has 19 branches and 3 extensions counters operating in the city of Chandigarh.
loans and overdrafts from the Reserve Bank of India. State cooperative banks lend money to central co-operative banks and primary societies and not directly to farmers.Organizational Structure So State co-operative banks are a federation of central co-operative banks and act as a watchdog of the co-operative banking structure in the state. Its funds are obtained from share capital. Expectation of the bank from the public for enhancing its effectiveness and Efficiency:- . deposits.
Arrangements and methods made for seeking public participation/contribution:The Bank has an elected Board of Directors which is the main governing body of the bank. The funds of the bank consist of share capital. HEAD OFFICE. THE PATIALA CENTRAL CO-OPERATIVE BANK LTD. The bank also expects that public should repay the loans taken by it timely so that the bank may be able to channelize the same. 772. the object of the Bank is to Facilitate the operation of. deposits. These banks finance member societies within the limits of the borrowing capacity of societies. The profile of Patiala Central Cooperative bank is as under:• • • • • Name of society. a separate Vigilance Cell has been created at the Head Office of the Bank. Punjab. Cooperative Societies. The affiliated Co-operative societies by. NABARD and State Govt. Providing Banking and credit facilities to its members as convenient and easy terms are possible. Mechanism available for monitoring the services delivery and public grievances resolution:The Bank is governed by an elected Board of Directors which regularly monitors the services delivery system.The Bank expects that the general public should take maximum benefits of the services offered by it. . Customer meets Annual General Body meeting.& Date.No. Registration No. District and State level Technical Committees are established to fix the scales of finance of various crops. To properly handle the public grievances/complaints. 28th September 1949 Area Of OperationAs per bye-law no.The Patiala Central Co-Operative Bank Ltd. PATIALA Central co-operative banks are the federations of primary credit societies in a district and are of two types – those having a membership of primary societies only and those having a membership of societies as well as individuals. The bank expects from the public that they should keep their surplus money in the shape of deposits with the Bank and take maximum benefits of various loan schemes of the Bank. 3. The Bank is regulated and inspected by Reserve Bank of India. There is a statutory audit system in the Bank by the Auditors. Encouraging thrift and saving amongst its members by offering suitable facilities. Annual Cooperative Week celebrations during the month of November every year. loans and overdrafts from state co-operative banks and joint stocks. under the control of Chief Auditor. It will be in the interest of the public also.
Management and Organizational Structure As per bylaws No. 776 on 28-09-1949 by the registrar co-operative. Nabha. Sr. Eight Directors to be elected out of members Co-operative Marketing cum processing Societies. Dera Bassi block transferred to that district. Rajpura. Samana. 1 2 3 4 5 6 7 8 Name of Directors Balraj singh chauhan Bikramjit singh Harkishan singh Umar Ranjit Singh Bharpur Singh Jasbir Singh Bajwa Joginder Singh Jaspal Singh Designation Chairman Vice Chairman Director Director Director Director Director Director Name of Departments . The copy of the application submitted for its registration shows Patiala and Sangrur district as area of operation of the Bank.C. Directors to be elected out of the remaining Co-operatives societies. Co-operative Societies PEPSU although the old bylaws do not mention that area of operation of the Bank. Under the Indian Co-operative Societies Act-ii of 1912 the P.C. of these societies exceeds fifty-one.B with registration no. In case. There are 8 Blocks Patiala. Patran. 28 the Board of Directors shall be constituted as under • • • Three Directors to be nominated by Govt. The No.• • Making arrangement for supervision and inspection of its affiliated Co-operative Societies. There are 4 Sub-divisions namely Patiala. is member. Undertaking such measures as are conductive to the spread of Co-operative education and training. One Director to be elected out of member industrial Cooperative societies. Ghanour and Sanour. With the creation of new district of Mohali . None of elected Directors has incurred any disqualification of director so far and there is no Director who continuously remained absent in three consecutive meeting of Board of Directors. so long as the Govt. Nabha and Rajpura. Bhunerheri. Samana.
bill of employees Salary of employees’ maintained. To maintain Misc. This department keeps up the current A/C related with commercial bank. Furniture fixture.A. Income Tax. and House Loan. GSLI Grievance of public & branches.L.A. We tell about his Head of Department. Pass T. department reconciled the A/c of all the branches. To maintain several records (with service book of employees) Transfer of employees. Functions of Various Departments • • • • • • • • • • • • • To maintain monthly statements etc. its functions & number of members working in the departments. Statements of NABARD. House Loan To issue charge sheets of employees & maintain it. like as – LIC. Sanctioned of cash credit limits of societies. D. Maintain the current A/C with P. Yearly statements. GI. of societies.C. files. state level /aims. Increment concerned with employees. Master policy of holder such as – EDLT.There are various sections / departments which are working in the Bank.B. That department issues the drafts of local. It helps to maintain sundry A/C. Number of Persons Working Under above Section • • • • • In this section number of persons working is ten. Fuctions of Account Section • • • • • • • • • The Misc.C.S. Here we tell us about those departments / sections which play important role in Banking. Passing the M. Maintenance of receipt and dispatch register. 1 Senior Manager 2 Manager 2 Assistant Manager 5 Clerks Functions of Loan Department .
Vehicle loan – two wheeler. like as – cash credit trader Cash credit farmers Loan against property Rural godown Mini dairy Mai Bhago scheme Renewal of cash credit limits.O. Physical verification done before sanctions the limits or loans. • Maintain statements for refinance &send to NABARD. Functions of State Section • • • • • Planning Renewing Compiling Achievements (for net result of the bank) Next year forecasting Number of Persons Working Under are There are seven persons working in stat section • • • • • 1 Senior Manager 1 Manager 2 Assistant Manager 1 Accountant 1 Clerk . & S. three wheeler.• Sanction all types of loans. like as – Consumer Composite /integrated Vehicle Loan Computer loan –only for staff member • Sanction all types of limits.R.T.
pay rolls. There is no extra system for recording the time. preparing budgets. Miscellaneous Activities • Office Time: . Than duty was complete they will entered the departure time 5. • Log Book : -All the vehicles of the company having logbook. how much kilometer are to be used by this log book the person who used the vehicle fill this log book and signed on also fill that for what purpose. Entered the time in the Attendance register in the first column and at time of lunch. Medical loan LTC Loan (Loan Traveling Concession) DA (daily allowance) TA (traveling allowance) .30p. Festival loan. And also entered the total working hours in the full day. The departure time for lunch at 2p. preparing profits and loss accounts. FACILITIES FOR STAFF The following facility is available to staff members. The perform shows that.m.m. recording receipts and payments. All the employees come at 10a. All these are office work and performed by this special office. • • • • • • • House Loan facility at subsidiary rate.m.The P.B. has fixed the timing for all the employees the timing of this company is 10a.m. are office activities of specialized nature. Scooter loan/ motorcycle/ car loan at subsidiary rate.m. preparing statement of assets and liabilities etc.00p. Each vehicle has own separate logbook. The recorded of the arrival & departure was recorded through Attendance register company maintenance the attendance registers.• 1 Typist Account and Finance Department Keeping of account and maintaining books of accounts. To 5p.C. The vehicle was used.C. All the records of this vehicle were kept in this logbook. When they come after lunch they will entered the arrival time 2.m. The entire employee entered.
N. 16 out of the 43 Branches of the Bank are working at the focal points – a scheme started by Govt. The Bank has been in the services of the people through a network of its 43 branches spread over the district of Patiala.Khalsa Daun Kalan Dandrala Dhindsa Dakala Devigarh Ghanour Ghagga Gulzarpura Galwatti Gajju Majra Gurbax Colony Gajewas Jand Mangouli Khera Gajju Kamalpur Lang .Various Branches of PCCB A part from its head office at Patiala. Name of Branches Sr. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Name of Branches Agoul Arya Samaj Bhupinder Nagar Babbarpur Bhadson Banur Basantpura Balbera Bhunerheri B. of Punjab.
Patiala Mandouli Nabha (M) Nabha (E) New Anaj Mandi Patran Sirhind Road Pabri Rakhra Rajpura Sanour Samana Shatrana Sultanpura Shambhu Kalan Tohra Top Khanna Moor Mission of the Bank: Promotion and sustenance of economic interest and providing easy finance.26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 Massingan The Mall. Objectives of the Bank: The objects for which the Bank is established are as under:1. 2. . cost effectives and quality banking services to customers and PACS. To serve as a balancing center for cooperative societies (hereinafter called the society/societies) in the State of Punjab registered under the Act for the time being in force. To promote the economic interest of the members of the Bank and Cooperative Societies in the State in accordance with cooperative principles and to facilitate the development and funding of any Cooperative Society registered under the said Act.
I-flex subsidiary Flexcel will deploy. trusts and convenience designed to benefit the employees or exemployees of the Bank or the dependents or connections of such persons to grant pensions and allowances and make payment toward insurance. To establish and support or aid in the establishment of and support to association. the technology has been successfully deployed in about 40 branches. To solicit or procure insurance business as a Corporate Agent Technology Used In Bank Patiala Central Co-Operative Bank Enhances Its Efficiency By Using Flexcube Rolling out Flexcube core banking technology . At present. To adopt such measures as are conducive to the spread of cooperative education and training. host and manage the core banking system. House Building Societies and members of Group Housing Societies for purchase of house or construction thereof by enrolling member/nominal members. and the next 200 locations are awaiting their turn. Providing Long Term Loan for the maximum period of 15 years to individuals. To promote and develop Cooperative Societies in the State. House Building Societies and members of Group Housing Societies for purchase of house or construction thereof by enrolling members/nominal members. funds. according to Indian fintech vendor I-flex . real-time banking to accounts from any of the 800 bank branches in the network. To provide long term loan for the maximum period of 15 years to the individuals. 8. 4. institutions. Plus it will help PSCB to set the fixed standardization of products and services to customers. Federation of Coop. Coop. 5. To do all such other things as are incidental or conducive to the promotion or advancement or objects of the Bank. .3. 7. To carry on banking and credit business not repugnant to the provisions of the Act and the Rules framed there under for the time being in force and in particular to provide credit facilities to the members. Punjab State Co-operative Bank (PSCB) is about to conduct an operation on deployment of the core banking system across its all 800 branches of the 19 district central co-operative banks. House Building Societies. Coop. The program of deployment was worked out to improve transaction processing and to provide online. powered by Oracle Database and Oracle Real Application Clusters. 6.
maintain the customer intimacy we have created over the years. and develop competitive differentiation because we expect the market to be increasingly demanding. This can be done by developing competitive skills to compete with other private and nationalized banks 2010 onwards To concentrate mainly on industrial sector for application and allocation of banks funds. Oracle Database and Oracle Financial Services On Demand to enhance our efficiency by replacing manual processes. I-flex explained that the new name signs its "close strategic and operational alignment" with parent company Oracle.PS Sidhu. VISION STATEMENTS Year Vision Statements 1931-1980 To concentrate on providing funds at low rate of interest to farmers to protect them from the fund provided by GREEDY SAHUKARS at high rate of interests 1980-2009 To concentrate on all the sectors of the society for providing and acquiring funds." One month before i-flex got a consent of both shareholders and regulatory body sides to change the company name to Oracle Financial Services Limited. which holds an 81% stake in its business. says: "We selected Flexcube. MD. Punjab State Co-operative Bank. CHAPTER – III RESEARCH METHODOLOGY .
Research methodology is the specification of method of accruing the information needed to structure or solve at hand. Research Design Research design is a pattern or an outline of research project working. The two words form a noun to describe a careful and systematic study in some field of knowledge. Redman and Mory defines research as a “Systematized effort to gain new knowledge”. To know the structure and various schemes of loans provided by The Central Cooperative Bank Head Office Patiala . to probe. . that the significance of research lies in its quality and not in quantity. Re means again. It is a statement of essentials elements of a study. keeping in view of the objectives of the research. to test and try. • To know the purpose of granting various types of loans by the bank according to the various categories of customers. Under this project. Research is an organized and systematic way of finding answers to questions. in the planning and development. undertaken to establish facts or principles. Research design carried out was exploratory in nature Objective of Study • • To get information about a cooperative bank & its functions etc. Search means to examine closely and carefully.Research methodology Research is composed of two syllables. • To know the process of granting loans by the bank. a prefix re and a verb search. but also building up to data knowledge and to discover the new facts involved through the process of dynamic change in the society. Research design stands for advance planning of the methods to be adopted for collecting the relevant data and the techniques to be used in their analysis. anew. over again. those that provide the basic guidelines for the details of the project. It is not concerned to decision of the fact. Further a research design is an arrangement of condition for collection and analysis of data in manner that aims to combine relevance to the research purpose with economy in procedure. It may be noted.
These are : I) Primary Sources II) Secondary sources Data has been collected both primary as well as secondary sources as described below: • Primary Sources The primary sources of data were circulars relating to the bank and personal observation. These helped in gaining knowledge about the Bank. and the bank’s profile which includes functions of bank and various schemes of granting loans etc. Limitations of Study • • Lack of personal interest of employees to provide information and adequate time. There are two types sources from where data is collected . CHAPTER – IV ANALYSIS OF LOAN PROCEDURE AND LOAN SCHEMES .Collection of Data Collection of data is most significant stage of every research. Some employees were hesitant in providing complete information. • Secondary Sources The secondary sources of the data were the information about the PATIALA CENTRAL CO-OPERATIVE BANK LTD.
home improvement etc. and the borrower agrees to return the property or repay the money. In anyone's life a situation may come when all of sudden you require cash. personal loans. at some future point(s) in time. purchasing a home etc. loans are available. because there is solution for these queries. Personal loans are available for personal requirements like wedding ceremony. business loan etc. Student loan as it itself suggest is that it is provided basically to students for higher education. . Here lies a question that a person who does not have a good amount of money at particular time has no right to see dreams? Is he not authorized to fulfill his desires on time? Should he stop dreaming? No. Loans are provided to people for such critical circumstances which may occur at any time. You can get business loans to start and well establish a new business in market. There may occur any kind of emergency when you need huge amount of money. there is a predetermined time for repaying a loan. To start a new business you require a huge amount of money. For this business loans are available. going for a holiday trip.Definition of Loan An arrangement in which a lender gives money or property to a borrower. A person willing to setup a business may not have that much cash which can meet out his requirements. educational purpose. Loans are available for these purposes only. and generally the lender has to bear the risk that the borrower may not repay a loan (though modern capital markets have developed many ways of managing this risk). Sometimes it so happens that they have keen desire to purchase their favorite stuff but they are incapable to purchase due to shortage of money. Many of your desires can be fulfilled by this loan. usually along with interest. Usually. For each and every kind of need. student loan. There are various types of loans like home loans. Home loans are available for general home purposes like buying a luxurious car. A moment when you do not want to borrow cash from your relatives. Importance of Loans in Today's Life Everyone needs money at every stage of their life. You can take any type of loan you need. Students who want to study more but can not afford can get apply for such loans and continue their studies.
For example. decisions. Henrik Ibsen once said. lenders are trying their best to attract people by providing different schemes which in turn is good for people. but most neglect efficient. Apply for that loan whichever is needed to you. If the person in charge of travel arrangements is out of the office. the manager should meet with each . Nearly every company prepares job descriptions. need of money explains the importance of loan.people should be able to pitch in and get the job done. Importance of Procedure Manuals One of the worst case scenarios of office problems involves a very important job that cannot be completed by the support staff because of a lack of information on procedures. someone might be in charge of travel arrangements. But before applying you should go through different lender's policies and apply for that lender which is beneficial for you. At the beginning. how to process the invoices by explaining the forms and what department handles them. What is a Procedure? A procedure is a specified series of actions or operations which have to be executed in the same manner in order to always obtain the same result under the same circumstances (for example.Whatever may be the kind of loan. product or outcome. everyone ought to be prepared to take the helm. Managers should see that every support staff employee in his or her department prepares a procedures manual for each job. Appling for loan is very easy. all have full fledged facilities. Due to competition. Above all. Different lenders have different policies. And cooperative bank is also one of them. this word can indicate a sequence of tasks. If you get loan for long term with low rate of interest then it is beneficial for you. that when undertaken in the sequence laid down produces the described result. steps. "A community is like a ship. emergency procedures)." Likewise. the best people to contact. This is possible only if they are provided with the proper instructions and materials. A procedures manual would give the names and phone numbers of various travel agencies used for the firm. A procedure usually induces a change. someone else can open the procedures manual and follow the directions to do the job. exact and up-to-date procedures manuals. A job description entails. Every job entails a certain sequence of paperwork. A job description would state that the job entails making both domestic and foreign travel arrangements and processing invoices for this. Less precisely speaking. routine tasks and contacts. calculations and processes. All kind of loans have their own importance. an office . A procedures manual gives a detailed and informative guide to how the job is done and enables someone to do the job in an emergency.
a description of how they are operated for this particular job (i. Keeping the job "complicated" and being the only one able to do it gives this type of person a sense of job security and self-esteem. addresses. These employees should be helped as much as possible and . One of the problems in every office involves employees who are reluctant to. If a computer sequence is followed to complete forms or reports for the task. forms or materials needed (and where they are kept). If office machines are involved (computers or word processors). Who . If persons. chain of command. Outdated information will only confuse someone and will not get the job done. A "dummy" of each page should be filled out so that it can be easily followed. 4. addresses and phone numbers as well as a brief description of what each does. no less do it well. They do not want someone else to do their job at all. Unfortunately. the procedures manual should give specific names. names or directions need updating. Another important part of the manual is making sure that it is up to date. An outline of what is expected should be prepared and given to each employee to follow. Both the employee and manager should have copies that are accessible to others.employee individually and discuss the preparation of the manual so that its function is fully understood. where information is stored. copies of each screen used should be made and placed in the procedures manual in the proper order. All employees should be instructed to check the procedures manual they have prepared at least once a month to see if phone numbers. agencies or companies outside your company have to be contacted to complete a job.). What . potential problems and solutions based on experience. etc. A good manager must be able to communicate to these employees that a procedures manual is vital and must closely monitor the employee to see that a manual is prepared and is viable. The outline should cover: 1. How To .What people are involved in completing the task. how long it will take. share information because they feel it will diminish their importance. if disks are used.How often it is done. • • • • Important details One of the most important aspects of a procedures manual is that it is detailed and gives all the necessary information to get the job done in the quickest way possible.Sequence of steps to complete the job. what you need from them and what they need from you. this type of thinking does much more harm than good. Some people will be afraid that their writing skills are inadequate and they will be unable to do their part properly. electronic mail.A description of the task. 3. how to retrieve the information. or refuse to. Phone numbers. departments. 2. When . Employee resistance to the idea of doing a procedures manual is to be expected.e.
quit or leave for a variety of reasons ." you have very little idea of what time and effort is involved unless you have done the job yourself (probably unlikely). this and this. there is a big difference in the amount of time expended. This enables the office to run much more smoothly and gives managers a "feel" for what is going on in their departments. A procedures manual is a simple office tool that can save a lot of time and avoid a lot of problems. but it certainly helps. Most employees will welcome the manual when they are called upon to fill in or help out because they will at least have some idea of what is to be done and how to do it. Detailing the steps involved would enable anyone to take care of the job without confusion and problems. Hiring decisions Managers can. whether the job is being done as efficiently as possible.often quite suddenly. can make hiring decisions as to whether or not extra staffing is required or whether people can be let go. obviously retraining is necessary or the employee should not be in the job. make decisions about consolidating certain jobs when there is an obvious lack of work in some jobs and too much in others. dates and times or arranges for audio/video equipment. Their contributions can be polished later on. A procedures manual can help avoid confusion when someone has to step in and do a task that is not normally part of his or her job. by the step outlined in the manual. If the employee seems to go about tasks in the most complicated. A procedures manual would indicate whether the person in charge simply keeps a reservation book noting the names. or have it written down in a procedures manual. What is vaguely written in a job description as "handle board room reservations" could take from five minutes to hours depending on what is involved. provides writing tablets and pens or takes minutes as part of the job. . It also enables the manager to feel more confident about being in charge because he or she knows precisely what is going on in the department. People do get sick. difficult manner. therefore. depending on what steps are involved. A manager should be able to see. resistance is greatest among those who know they have more time on their hands than the job entails. A procedures manual also allows a manager to see what people are doing and estimate how long certain duties take. These people will usually denigrate the whole idea of writing down what they do in detail. Another advantage of the procedures manual is that a manager can see whether or not an employee is suited to a certain position.• • • • • encouraged to do the best they can. including contacting maintenance people to see that the room is cleaned before and after and arranging with the receptionist to make sure the names of all outsiders are given to her and guests are properly directed to the location of the meeting. knowing that keeping the details vague makes the job sound a lot busier than it really is. coffee or other beverages and refreshments. Usually. Obviously. Some tasks can take 10 to 15 minutes if you know exactly what to do and might take most of the day for the uninitiated to muddle through and try to get it right when the usual person in charge is out. "I do this. A procedures manual is not a panacea for all office management problems. extra seating. If you ask an employee what a job entails and she or he says.
student.. For example a person want to take a vehicle loan .Loan Procedure The loan to get passed. trust. Custer may be a farmer . III. individuals . employee of govt. it has passed through many hands as shown in the following figure. Customer Under the above procedure customer means the per who wants to take a loan. Inquires Information Procedure for getting a loan I. interest rate. note) . II. period of time. He is provided this information by the clerk at the reception. cooperative Societies etc. mode of loan disbursement. firm. Reception Here a person (customer) inquires about the loan rates and other prerequisites that are to be submitted. or semi govt. For example: to take a House Loan he submitted various types of documents like: 1. Submission of documents: After getting the information customer submit the required document to bank facility. companies. perquisite documents etc. Demand Pronote note (D. or any institution approved by the board of directors of the bank.P. At this step he is get the information about the amount sanction criteria. mode of repayment.
The borrower shall be also required to submit collateral security @100%of loan amount etc.2. After the satisfaction with all the parameters. To take a loan borrower firstly required to take nominal member ship of bank. This is done as follows. 1. the process is started actually. Non encumbrance certificate. 10. Only after fulfillment and submission of all documents which are required according to take various types of loans. 3.e. the officer verifies the work done by the clerk at the credit rating desk. 7. V. 5. i. 9. Now. Inspection: After having calculated the credit and the amount that can be sanctioned for loan. First the total value of the customer’s assets is calculated. 6. 12. Details of cost/estimate from approved Architecture/valuer/Engineer of the house to be purchased/constructed/ renovated/addition to made. Moreover. For example if loan is on a stock plus if he has provided the papers of his business land. the file is forwarded for inspection. total value = value of stock + value of land 2. according to the rules of bank some percentage of the value of these assets can only be given as loan. Latest jamabandi and girdawri. the credit rating of the customer is done i. Two latest attested passport size photographs of borrower Proof of Residence Source of Finance for own contribution Copy of approved drawing of the proposed dwelling unit to be constructed/purchased from Sarpanch/Numberdar. Certificate of ownership of land/property situated within Red Line of the village from the Sarpanch/Numberdar/Patwari 11. 8.e. This percentage varies for different types of loans and based on it the sanctioned loan amount is calculated. 4. Here. Credit rating: Based on the documents submitted by the customer. VI. Loan Manager: . VI. he hands over the file to the loan manager. then in this case his credit will be calculated as a sum of the value of both these assets. Agreement of sale deed. he checks the bank’s database to see if the loan taker has any previous obligations which are remaining to be met (if he is an old customer). how much the loan amount should be granted to the customer is calculated.
Before the disbursement of loan amount to customer firstly bank require becoming a nominal member of bank.to 500000 Rs. Meeting: If the amount of loan is grater than 5 laces then a meeting is conducted between board of Directors of the bank After having examined the file./-. At this stage loan granting manager recheck all the documents. District Manager : District Manager can grant a loan from 200000 Rs. The maximum amount is granted up to 100000 Rs. the file is then put forward before the Chairman and Managing Director (MD) in a meeting. Moreover. IX. the loan amount or account is handed over to the customer.only Board of Directors: If the loan amount is greater than 500000 Rs. then loan amount is paid to the customer./.At this step . If the loan is consumer loan then it is directly granted by branch manager . So according to different types and different amounts of loans. The powers of granting different types loans of different mangers are as under: • • • • Branch Manager: Branch Manager has power only to grant the consumer loan. Insurance: Before issuing the loan amount or opening of a/c for loan. VIII. But if the loan is personal loan or vehicle loan or any other type of loan then it is granted by senior manager or district manager././. then the insurance is taken on that particular thing also. if any other thing is mortgage for taking loan.only. Senior Manager: Senior Manger has power to grant a loan up to amount 200000 Rs. the customer is required to get insurance on the thing on which he wishes to take loan. the file of customer reexamined by the loan manager. VII.then it is granted by the board of directors of the Patiala Central Cooperative Bank. But he is also liable to give specific reason to the customer about the rejection of loan. Giving away of Loan: After paying the insurance amount. But if there is any thing which is unclear or insufficiency in the documents. This is explained in detail in the coming sections. If all the members of top management are mutually consent then the application of loan is ready for disbursement of loan amount. he has power to reject the loan application. . these are granted by above parties./. This is done by bank with the help of United India (UI) Insurance Company. Loan manager pass the loan if customer fulfill all requirements. This file is then cross examined.
Loan shall be advanced under the scheme for purchase of built up house. After roof level – 25% So above are the various stages into loan procedure adopted The Patiala Central Cooperative Bank.) Eligible Borrower: . Up to roof level – 25% c. . the GOI and State Govt. Bank to start housing finance for acquisition.T. b. Any customer can easily get a loan to fulfill his/her various requirements and get it fastly as per as possible. construction. Like in case of Rural Housing Loan amount is paid into two installments:a.With a view to provide housing facilities to the masses which is a basic need of human beings. The scheme shall be called the “Scheme for Financing Rural Housing” and is applicable to individual/members of house building cooperative societies in the state of Punjab and Chandigarh (U. In case Urban Housing Loan amount of loan is disbursed into three installments: a. This scheme has particularly been designed for rural people. it has been decided by the Coop. For purchase of plot – 50% b. repair/alteration etc. where other financing institutions are reluctant to advance. 1st installment at the time of starting construction up to plinth level. 2nd installment after completion up to roof level. are attaching utmost importance to the financing of housing sector. 50% 50% Loan Schemes * Scheme for Financing Rural Housing * Preamble:. Several housing schemes for this are in operation.1) Individuals 2) Cooperative Housing Societies Purpose of Loan: . With a view to supplement these schemes. construction of a new house or repair/ renovation/addition/alteration of existing house in rural areas.In some type of loan schemes the amount of loan is paid into installments.
Margin money – 15% c. otherwise cost of land should not be included in the project cost Quantum of Bank loan for Individual: .5% concession is allowed to women.e. The first installment shall become due after expiry of 9 months from the date of drawl of first installment in case of construction and whereas in case of purchase of built up house.The security of the loan shall be first mortgage charge on the house property to be financed by the bank by way of registered regular mortgage. Interest Is charged as contract made with the loanee. Income of the co-applicant can also be considered for loan eligibility. Security: . For Renovation/Repair/Addition/Alteration: a. Repayment period – 10 years in monthly/half yearly installments. In case land is being acquired the cost of land may be reckoned as margin money. Maximum loan – Rs.5 lacs (for repair/ addition /alteration of House) b. A reasonable installment to income ratio i.15.At present rate of Rural Housing is 11% and further it shall be determined by financing bank from time to time and debited to loan account. on the default amount for the default period. subject to 85% of cost of construction or value of property to be purchased.The quantum of loan shall depend upon repaying capacity of the borrowers. Maximum loan – Rs.The loan for a dwelling unit may not exceed Rs. normally upto 35% of the gross income can be taken as repayment capacity of the borrower.The maximum period of loan shall be upto 15 years and loan shall be repayable in equated monthly/half yearly installments. Penal interest @ 2% over and above the normal rate shall be charged in case of default. it shall start after expiry of 3 months from the date of purchase. Due date shall be 30th June and 31st December every year. Loan eligibility shall be calculated on the basis of repayment capacity of the borrower. The repaying capacity shall be determined on the basis of land holding and other known sources of income and commitments/subsistence towards his family. For construction/purchase of new House a. 0.00 lacs. Margin Money – 15% Repayment period – Up to 15 years in monthly/half yearly installments. Value of agriculture land as per norms fixed by the District Collector from time to . Period of Loans: . In addition to it collateral security shall be taken @ 100% of the loan amount in the form of agriculture land.15. Rate of Interest: .00 lacs b.Ceiling on the cost: .
. loan shall be disbursed in 2 installments.. however. Source of Finance for own contribution. Payment shall. Application form Loan agreement D. the payment shall be made @ 75% of total value of the house/Loan sanctioned.Following documents are required for financing under Rural Housing Scheme 1.Processing Fees and other charges @ 0. 1st installment at the time of starting construction up to plinth level. d. etc. loan can be advanced on primary security i.time should be taken into consideration. Latest Jamabandi and Girdawari. 6. 4. Proof of residence. Phirni) of the village from the Sarpanch/Numberdar/Partwari.. along with two good sureties and undertaking under section 39 of Punjab Cooperative Societies Act. Boards.e. 2nd installment after completion up to roof level. For construction loan. Non-encumbrance certificate. be made to third party in lump sum after getting margin money from the borrower and remaining 25% shall be released after obtaining Mortgage Deed in favour of the Bank. 9. 5.e. semi govt. 2nd installment shall be disbursed after ensuring proper utilization of previous installment. Sanction and disbursement of Loan: . Certificate of ownership of land/property situated within Red Line (i.. 10. Agreement of sale deed. Details of cost/estimate from approved Architecture/ Valuer/ Engineer of the house to be purchased/ constructed /renovated /addition to be made. In case of employees of the Govt. 11.The loan shall be sanctioned after it is ascertained that the applicant fulfils all the requirements and enjoys reputation as a good pay master. Corporation. 7. 50% 50% .25% of loan amount shall be charged Documentation & general requirements: . P. constructing house within rural areas. Processing Fee & Other Charges: . Copy of approved drawing of the proposed dwelling unit to be constructed/purchased from Sarpanch / Numberdar. 8. In case of built up house. 2. 1961. the borrower should be in possession of plot with unquestionable and indisputable title. 3. which is as under:c. mortgage of house to be financed. Note Two latest attested passport size photographs of the borrowers. 12. For construction of house.
Societies. This scheme may be called Urban Housing Loan Scheme to individual and members of house Building Societies by The Punjab State Cooperative Bank/Central Coop . Punjab Chandigarh decides. Agency. Purpose: . construction of house or repair. flat. if any will be enrolled as nominal members of the bank under the Act. The applicant and co-applicant. house in an existing or proposed Cooperative House Building Society and approved scheme of PUDA. Loans shall also be given for acquiring a plot. etc. Improvement Trust or any other Govt.Bank (s) in the State of Punjab. House fed.An individual residing in the area of operation of the Bank may apply for the loan in his individual name or along with another person being joint owner of the land/property as co-applicant. * Scheme for Urban Housing Loan * Short title Extent and Commencement a. additions. purchase of built up house. . alteration.Loan shall be advanced for the purchase of plot. Salary Certificate. Completion certificate. renovation.13. ii. Loan can also be advanced for take over of an existing loan advanced by any other bank/financial institution subject to the condition that the loan account should have remained in the standard category of assets for at least last 2 years in the previous financial institution Eligibility: . The borrower shall be required to submit collateral security @ 100% of the loan amount. iv. Note: The Borrower should not have defaulted in any other loan. Undertaking U/S 39. b. 14. The scheme shall be implemented through the branches of the PSCB/Central Cooperative banks concerned and shall be limited to urban areas falling in the area of operation of the lending Bank. iii. Rules and Bye Laws. Additional Documents from Employees: i. in the existing house. Post dated Cheques. The borrower shall mortgage his existing property : to be constructed/purchased in favour of the bank for the full value of loan. It shall come into force from the date as the Registrar Coop.
exceeding or up to 50% shall be utilized for construction of house thereon”. purchase of house (cost of construction + cost of plot. purchase of plot + construction thereon under this scheme is Rs. Interest Is charged as contract made with the loanee. Further this loan to employee will be against second charge on the said property. To 45 yrs of age. The employees of the Punjab State Cooperative Bank or Central Cooperative Banks who have already availed house loan under Govt. Penal interest @ 2% over and above the normal rate shall be charged in case of default.5% concession is allowed to women. if plot is to be purchased).The quantum of loan will depend upon the repayment capacity of applicant to be calculated by the bank as under : 21 yrs. if plot is to be purchased) and the loan out of it for purchase of plot will not exceed 50% of the total loan sanctioned. Quantum of Loan: .Maximum period (including moratorium period) shall be 15 years or attaining the age of 65 years whichever is earlier. For addition/alterations in existing house. or Bank Scheme from the Punjab State Coop.25 lacks or 75% of total cost of construction. Maximum loan amount for construction of house or purchase of house/flat. It will be further subject to the repaying capacity of the employee in accordance with their last salary statement. on the default amount for the default period. 0.At present rate of Urban Housing is 11% and further it shall be determined by financing bank from time to time and debited to loan account. The remaining. For repair/renovation maximum amount of loan shall be Rs. whichever is less. 48 times of the net monthly income (NMI) or 4 times of Net Annual Income (NAI) Above 45 years 36 times of Net Monthly Income (NMI) or 3 Times of Net Annual Income of the spouse or family member can be considered if spouse or family member is co-applicant or guarantor. In case of repair/renovation /addition/alteration loan cases maximum period shall be 10 years. maximum loan amount shall be Rs. .10 lacks.5 lacks. Period of Loan/ Repayment of Loan: . Bank or Central Cooperative Banks can also get loan under the scheme subject to maximum of Rs. Interest: . The loan for purchase of plot will not exceed 50% of the total loan sanctioned.25 lacks under both house loan scheme.The applicant shall be eligible for a total house building loan not exceeding 75% of the total cost of house (cost of construction + cost of plot.
4. Residential Proof. However. Documentation . The second and subsequent installment of loan shall be disbursed only after ensuring the utilization of previous installment to Bank’s satisfaction. 6.A processing fee @0. Copy of Income-tax Return for the three years duly acknowledged by ITO concerned.Pre-sanction stage: 1. 3. repayment of loan may be in half yearly installments i. the disbursement shall be in two installments. Identify proof. Bank shall not be bound to accept progress construction as assessed by builder. however. alterations and renovation shall be disbursed in two equal installments. In case of the farmers availing loan under this scheme. Security: . 2. for construction on pre-owned plot.The loan shall be disbursed after the property is technically appraised.Repayment of the loan shall. 30th June and 31st December every year.e. Fee & Other Charges: . Non-encumbrance certificate. Disbursal of Loan: . . Self attested recent passport size photographs of the applicant and co-applicant (two).Security for the loan is a first mortgage of the property to be financed normally by way of deposit of original title deeds. Sources of Finance for own contribution. 5. the disbursement shall be in 3 installments as follows:For purchase of plot – 50% Up to roof level After roof level – 25% – 25% Loan will be disbursed at one go for purchase of a built up house. be in monthly equated installment to be started from 9 months after the first installment of loan disbursed. all legal documentation completed and borrower having invested own contribution in full (own contribution is the total cost of proposed property – Bank loan). 1st Installment for construction after plinth level – 50% 2nd Installment for construction of the building after roof level – 50% Loan for repair.25% of the loan amount sanctioned will be charged. additions. In case of purchase of plot + construction.
Mortgage Deed Letter of Lien and Set Off Letter of Waiver Letter of Guarantee Employed applicants: . Detailed Cost estimate from Registered Architect/ Civil Engineer.Undertaking from the employee under section 39 of Punjab Cooperative Societies Act. Income Proof/J-Form. Loan application Form Post – Sanction Stage 1. 3. 2. Insurance: . Search report & legal opinion along with photograph of the property. Agreement of sale/sale deed/detailed cost estimate from approved engineer. In case of allotment of flat/houses. Loan agreement. 4. b. * Personal Loan * .7. a. Original title deed. 6. 8. Disputes If at any stage any dispute arises. Incase of default bank will be at liberty to get a policy renewed by debit to house loan account of the borrower Additional Documents in construction cases: a. 10. 1961. it will be settled/referred under the Punjab Cooperative Societies Act 1961. Construction Plan approved by a competent authority. riots earthquake lighting floods etc. 11. if any. A photocopy of registered title deeds or allotment letter (in case of member of Cooperative House Building Societies In purchase ofBuilt Up House cases. 12. Demand Promissory Note. 5. b. photocopy of allotment letter and details of balance payment. 9. Spot Physical verification. Purchase agreement of property. c.Comprehensive insurance in the joint names of the borrower and the bank shall be made of the property mortgaged against fire.
p.The Bank offers Personal Loan for various purposes such as meeting medical expenses.a. General: . Boards. traveling. Income: . Aided Schools/Colleges.12 Times of gross monthly salary or Rs.only .000/. Co-operative organizations in the state of Punjab or any other organizations as approved by the Board of Directors of the respective Bank etc.60. No penalty will be charged. which has defaulted in repayment of loan under any other scheme. Rate of Interest: . Loan may be repaid in 36/48/60 Equated Monthly Installments (EMI).Loan is repayable in equated monthly installments in the form of post-dated cheques. The Loan will be repaid before retirement. in case of salaried persons and Annual Income of not be less than Rs. Universities.14% p.Minimum 21 years and Maximum 57 years.No collateral security is required. Security : .000/.000/.Maximum. Service Tenure: .00. Period of Loan: . only two guarantor know to the bank.m. Premier Medical Institutions.salaried employees of Punjab government. Corporations. PSUs.Borrower can make the part pre-payment of loan. Option to repay loan: .1 year after the confirmation/regularization. Public Sector Banks. General Insurance Companies. Repayment of Loan: . whichever is less. * Consumer Durable Loan ( salary / Non Salary Earners) * Scheme for Granting Loans to Individual Salary and non-salary earners by the state and central cooperative banks for socio-economic needs 1. The 1st installment will start after one month. The bank may grant loans to individual salary earners and non-salary earners holding saving bank account or current account with the bank for purchase of consumer durables and meeting other socio-economic needs. 2. renovation of residential accommodation.No employee will be given this loan facility. Eligibility : . Age: .5 years. .in case of others. Loan Amount: .5.Net income of the person should not be less than Rs. marriage etc.
In case of SALARY EARNERS.40000/Amount Loan Rs.40000/Total net emoluments from Rs.Loan .30000/- c.18001/.15001/amount = Rs. Purchase of second hand articles should not be financed in any case.100000/.to Rs.Loan amount = Rs. then his salary or loan amount due will be credited to his loan account till the bank directs to do so. The bank shall inform the employer immediately after the sanction of .75000/Total net emoluments above Rs.5000/Amount = Rs.15000/Rs.to Rs. However he should also produce a copy of authority letter addressed to the bank and also an undertaking to the effect that in case borrower commits default in repayment of his loan installments. The Borrower should be required to produce 2 sureties who should also be nominal members of the Bank.27001/. The bank should obtain salary certificate from the borrower.18000/a.to Rs.25000/Total net emoluments from Rs.2.00 lac per borrower or 75% of the cost of article to be purchased whichever is less.50000/. More than Rs.27000/b. The loan should be repayable in monthly installments but the total duration of loan should not exceed three years in any case. in accordance with the slabs fixed hereunder:Total net emoluments upto Rs. 4.7501/.1.10001/. 6. the amount of loan should not exceed Rs.. The borrower should be enrolled as a nominal member of the Bank.25000/Rs.50000/. 3.per borrower or 75% of the cost of article to be purchased in accordance with the slabs fixed hereunder:Half Yearly Income a) Upto Rs.10000/amount = Rs.15000/. From Rs. the amount of loan should not exceed Rs.50000/5.7500/Amount = Rs. The borrower himself should be responsible for the repayment of his loan.Loan In case of NON-SALARY EARNERS. From Rs.Loan Total net emoluments from Rs.Loan .to Rs.to Rs.40001/Rs.5001/. The loan should be advanced for acquiring new assets only.
The loan should be advanced against hypothecation of the asset/assets acquired/to be acquired. The bank should take original invoice from the dealer and then the loan amount together with margin money should be paid through Bank Draft directly to the dealer to avoid misutilisation of the loan. if any. technical institutions. medical colleges. Demand Promissory Note An authority letter from the borrower under Section 39 of Punjab Cooperative Societies Act. Letter of waiver. At present rate of consumer loan is 14% and further it shall be determined by financing bank from time to time and debited to loan account. The borrower should give standing instruction to debit the amount of installments or overdue installments together with interest due on that loan every month to his saving bank account or current account as the case may be. 8. The bank should also obtain the following documents from the borrower :a. 1961 for repayment of loan in case the borrower fails o repay the loan. 0. Information Technology and professional courses. pharmaceutical colleges. d. g. 9. b. Management etc.5%concession is allowed to women. In case of default by the borrower. so that students from poor & middle classes as well as brilliant . c. on the default amount for the default period. the bank will ask the employer of the borrower to deposit the due amount by deducting from the salary of the employee. f.loan. Salary certificate/proof of income Loan agreement. Penal interest @ 2% over and above the normal rate shall be charged in case of default. * Sehkari Education Loan scheme * Education loan is granted for higher studies in colleges in India and abroad in any educational field in college affiliated with recognized universities. 11. Post dated cheques equal to number of installments should be obtained from the borrower. 10. Interest is charged as contract made with the loanee. An authority letter from the borrower to recovery the installment/interest by debiting to saving/current account. 12. 7. e.
IX. Caution deposit/Building Fund.An Indian National with minimum of 17 years and maximum 35 years of age can apply for this loan.Minimum Qualification for co-operative education loan (CEL) is plus two (+2) and the applicant must have secured at least 50% marks in the last examination passed. Eligibility: Age of student. Education Qualification. 5.00 lacs Rate of interest: .The rate of interest on Cooperative Education Loan Facility(CEL) shall be 7. Admission Fee Purchase of books and stationary Purchase of instrument required for course undertaken by applicant. Laboratory charges if any. This rate is however subject to change from time to time. if any. Duration Of Course: . Air fare for joining the course (for study abroad) Examination Fee. Admission to Course: .The age of Father/Guardian should not be more than 65 years till full recovery of loan amount.25% per annum.The applicant must secured admission or has got the consent of the institution to admit to any one of the above-mentioned courses.00 lacs Rs. II. 10. Library charges. X.The course should not be more than 5 years. XI. VII. VIII. Age of Father.and needy students can take advantages of the scheme. XIII. III. XII. [The scheme will not cover any correspondence course]. Purpose of Loan I. . Boarding and Lodging expenses Computer purchase if required. V. Refundable deposits. IV. Monthly/quarterly tuition fee. Amount of loan: For Studies in India For Studies Abroad Rs. Expenses on projects if any. VI.
7. 5. Applicant should produce year-wise estimated total expenditure which is to be incurred such as Tuition Fees. Disbursement of loan will be made at stages during the duration of the course of the study as per the requirement as mentioned in the schedule of year wise estimated expenditure. 4. Hypothecation of stocks and book debts. 2. Subsequently the loan amount for the next year will be disbursed after successful completion of previous year. In the first year disbursement will be equivalent to the expenses of first yearly only. The disbursement of loan should be by Demand Draft/bank cheque in favour of concerned university /college. Cost of Books. Students going abroad for study will have to submit the necessary documents such as copy of Passport. 6. All other documents and information to be provided as per checklist provided with the Application Form. Disbursement of Loan: . Mark Sheet / Certificate for passing last Board / University examination. The collateral security can be in the form of land/building NSC/KVP/LIC Policy/bank deposits in the name of student/parents/guardian. 3. Admission Letter. Insurance of student: . .The branch will get sanction of whole loan amount from competent authority but will disburse the amount based on yearly expenses of course. Progress Report of the studies of the student from time to time. copy of Form I-20 (for U. Term Fees.S). 9. Traveling. Security: . Bank must be informed and loan amount must be paid immediately.No collateral security is required up to a loan of 25000/-. In case of purchase of equipment/books/computer the payment shall be made to the applicant.The recovery of principle amount will start after one year of total duration of course or after 6 months of getting the job/employment by the applicant. Living Expenses.25000/. The valuation of the collateral security shall be equivalent to the loan amount. If study is discontinued for whatsoever reason.No processing charges shall be charged under CEL. etc.will be advanced against collateral security by the applicant/guardian. Recovery of Loan: . This loan shall be advanced against two good sureties. 8. Basic Requirements: 1. etc. The loan above Rs. copy of Admission Letter. Visa. Any scholarship received during the course of study must be intimated to the bank and as far as possible such amount received should be adjusted in loan account.Life Insurance Policy will be taken on the life of the student borrower for an amount equal to the loan amount and should be assigned in favour of Bank.Processing Charges: . which ever is earlier. Examination Fees.
Rule No.12 Purpose of loan is to provide financial assistance to purchase new vehicles for business and personal use. However farmers may opt for half-yearly installments due on 30th June and 31st December.1 These rules are called the rules for granting of Vehicle Loan to individuals. The cost of the vehicle shall be paid directly by the Bank to the suppliers or authorized dealers on receipt of intimation from the dealer and instructions from the applicant. Trust and Cooperative Societies. The maximum amount that can be sanctioned under the scheme is limited to Rs. HUF. failing which additional interest at the rate of 3% shall be charged. The borrower should agree to produce the vehicle for periodical inspection to ensure that it is maintained in satisfactory condition. * Vehicle Loan * Rule No.2 Rule No. In case loan is above 60% of the cost of vehicle (subject to 80% of the cost as stipulated in the rules).10 Rule No.5% concession is allowed to women The vehicle should be comprehensively insured for the full value covering all risks and the policy should be in the joint names of borrower and the bank with agreed bank clause. loans upto 60% of the cost of vehicle shall be granted against the comprehensive insurance and lien in the registration certificate. . Wherever sanctioning authority is satisfied. At present rate of vehicle loan is 13% and further it shall be determined by financing bank from time to time and debited to loan account.10.5 Rule No. firms.10.8 Rule No.11 Rule No.6 Rule No.4 Rule No.00 lac or 80% of value of the vehicle whichever is less. Interest is charged as contract made with the loanee. on the default amount for the default period. The loan documents should be executed by both the student and the Parent / Guardian as C o-applicant. Companies. The Bank reserves the right to proceed against the borrower and sureties in the event of default in the repayment of loan installment/s.3 Rule No. two good sureties shall also be taken in addition to the insurance and lien in registration certificate in case of buses and trucks for commercial use. The application for loans should be made in the form prescribed by the Bank. 0. Penal interest @ 2% over and above the normal rate shall be charged in case of default. One month moratorium period shall be allowed under the scheme. The repayment of loan should be in the form of monthly installments to be repaid within 5 years. 9 Rule No. The charge of the bank on the vehicle in the form of registration should be registered with the registering authority within 90 days of purchase of vehicle.7 Rule No.
one time road tax paid. Banks in UT and in the State of Punjab. The vehicle to be purchased by the loanee should not be more than 3 years old. this scheme has been diversified.An individual. Quantum of Loan : . should be accident free. d. c. asp or the value approved by the registered surveyor of any GIC with the condition that the insurer has to get insurance cover from the concerned Insurance Company on whose list the name of the surveyor appears. for personal/public use.14 The borrower should agree to be bound by arbitration provisions in the Punjab Cooperative Societies Act 1961 and the Rules framed there under. The scheme shall be implemented through the branches of the State and Central Coop. The applicant will be enrolled as nominal member of the bank under the Act. Societies Punjab Chandigarh. Chandigarh or the State of Punjab.T. b. extent and commencement:a.com/Sah & Sanghi price index. Present value shall be the value as provided by Sah & Sanghi in the current price Index and also available on Website htpp. Short title. which is lowest shall be the . sole proprietor.wwwautomartindia. Purpose: . This scheme may be called ‘Second Hand Vehicle Loan Scheme’ to individual sole proprietor professional and partnership concern residing in the area of operation of the lending bank by the State and Central Banks as the case may be. Rules and Bye-laws. sumo. The borrower should give an undertaking stating that all the terms and conditions stipulated by the Bank while sanctioning the loan and those conditions that may be stipulated in future by the bank are acceptable to him. jeep. etc. qualis. professional and partnership concern residing in the area of operation having permanent account number provided by the Income Tax authority in urban areas and in case of rural area having at least 5 acres of agriculture land and should not be defaulter.The quantum of loan shall depend upon the model and present value of the vehicle.Loan shall be advanced for the purchase of second hand vehicle such as car. Eligibility: . bearing Registration Number of U.13 Rule No.Rule No. It shall come into force from the date of approval by the Registrar Coop. * Second Hand Vehicle Loan Scheme * In the modern era there is a heavy demand for purchase of second hand vehicles and the banks have surplus loan-able funds to diversify the loan portfolio and to provide financial assistance to the borrowers for purchase of second hand vehicle.
Fee and Other Charges : . on the default amount for the default period. Interest is charged as contract made with the loanee. Security: .The loan will be disbursed after the appraisal of all legal documentation completed and borrower having deposited his share of margin in the SB account. in case the borrower is not willing to give sureties. pledge of NSCs. be in monthly equated installment.25% of the loan amount sanctioned shall be charged. Documentation : 1.A processing fee of 0. 0.quantum of loan.5% concession is allowed to women Period of Loan/Repayment of Loan: . Two self attested recent passport size photographs of the applicant and sureties each. Two good sureties residing in area of operation of the bank and having a PAN Card in case of urban areas and two sureties of the status of borrower in case of rural area. The maximum loan amount shall be Rs.At present rate of second hand vehicle loan is 13% and further it shall be determined by financing bank from time to time and debited to loan account. Copy of Income Tax Return for last three years duly acknowledged by ITO 6. A photocopy of the RC of the Vehicle and case of rural people copy of Fard. Residential proof 3. Disbursal of Loan: . Photocopy of the PAN 5. Repayment of the loan shall. The sureties shall be enrolled as nominal member of the bank under the Act. In case of urban borrowers and half yearly equated in case of rural borrowers due on 30th June and 31st December.5 lacs or 75% of the assessed price of the vehicle whichever is less. Term Deposits of own bank. KVPs. 4. The disbursement will be third party payment by way of banker cheque/Demand Draft in the name of the seller (owner of the vehicle) delivered through and under receipt from borrower. Penal interest @ 2% over and above the normal rate shall be charged in case of default. Jamabandi. .Maximum period of loan shall be five years. Interest: .The security for the loan is 1st Hypothecation of the Vehicle in the name of the bank entered in RC of the vehicle. Photocopy of the Driving License 7. Identity proof 2. OR A collateral security to the extent of 100% of loan in the shape of assignment of life insurance policy. Moratorium period of one month shall be allowed under the scheme.
Loan agreement 10. if any.Comprehensive insurance in the joint names of the borrower and the bank shall be made at the cost of the borrower. Societies Act. partly for term loan and partly . Punjab. U. however be not avail for speculative purpose. Dispute: .8. The applicant and co-applicant. Societies. Periphery by Punjab State Cooperative bank and at urban areas (within Municipal Limit) by Central Cooperative bank through its urban branches. Hypothecation deed/Collateral Security/Agreement Bond from Sureties. It shall come into force from the date as the Registrar. and is designed to offer instant solutions relating to socio-economic needs such as children’s higher education. Agreement of Sale. Purpose: . Insurance: . The scheme shall be implemented through the branches of the Punjab State Cooperative Bank Limited & Central Cooperative Banks only through an urban branch in the State of Punjab and shall be available to Individuals. travel. Certificate of present value of car assessed by Surveyor of company guide or as determined on the basis of guidelines of the Punjab Govt. Employees of the PSCB/DCCB can avail this loan against property already mortgaged with the bank by creating second charge of property subject to the repaying capacity of the employee as per the scheme of loan. Chandigarh decides. b. DP Note 11.e. on the Subject. medical emergencies. Type and Quantum of Loan: . Loan application form 9. An individual residing in and having a self occupied immovable property in the area mentioned in the Purpose Clause no. Rules and Bye-laws.3 may apply for the loan in his individual name or along with another person being joint owner of the land/property as co-applicant. In case of default bank will be at liberty to get a policy renewed by debiting to loan account of the borrower.If at any stage any dispute raised. 1961 and rules frames there under and bye-laws of the bank * Scheme of granting Loan against Property * Short title.The loan can be given in the shape of Term Loan or Credit Limit. The age of borrower should not exceed 65 years at the time of applying for the loan. Beneficiaries should be enrolled as Nominal Member of the bank. Eligibility: a. will be enrolled as nominal members of the bank under the Act. 12.The scheme is for providing finance against mortgage of immovable property situated at Chandigarh. extent and commencement: . The loan will.T. Loan can also be given for both purposes i. daughter’s marriage. etc. it shall be settled/referred for arbitration under the provisions of Punjab Coop. 13. Coop.This scheme may be called Scheme of LOAN AGAINST PROPERTY(LAP).
Loan application Form. D. 9.a.00 lacs.Interest shall be charged @ 15% p. Letter of lien and set off. The guarantor should have its net worth equal to or more than the loan amount to advanced. II. Repayment of Loan: a.for credit limit subject to quantum of loan for both the loan and limit will not exceed from Rs. 4. against which loan/limit is granted. he/she must be taken as guarantor.P. Original Title Deed. Non-Encumbrance Certificate. Note. Processing Fees: . Approved Architect. .25.a. III. 3. 7. over. by way of deposit of title deeds. Overdraft facility is to be renewed/reviewed annually.25% will be levied every year on the credit limit. Security: I. Letter of continuity 10. In case of defaults a penal interest @18% p. Post dated cheques for the months for which repayment of term loan option is due. Search report and legal opinion along with the photo. Income of family member can be considered for the purpose of eligibility of loan. Quantum of loan will be three times of net annual income or 50% of value of property.5% of the sanctioned amount shall be charged. In case the income of family member is taken while calculating loan eligibility. b. In case of limit of 0. 2. 5. Mortgage Deed.0. Loan Agreement. 8. it will be the official rates of registration fixed for the same by respective Municipal or Registration Authority or current market value whichever is lower. Documentation: 1. Interest: . Loan together with interest is repayable in maximum 72 equal monthly installments. For the properties situated out side the Chandigarh. whichever is less. Security for the loan is a first mortgage of the property. However maximum loan amount will be Rs. The valuation of the property will be based on the basis of last reserve price of the auction fixed by the Chandigarh Administration. Suitable one guarantee acceptable to the bank. compounded quarterly or as may be revised by the bank from time to time. 6.25 lacs. Map and Current Valuation Report of the property from Govt.
5. Purpose: . 4. Chandigarh. housing agencies.Comprehensive Insurance in the joint names of the borrower and the bank shall be made of the property mortgaged against fire.If at any stage any dispute arises. 4. riots. 6. urban Development Authorities like PUDA. 2. Proof of Identity – Any one of Voters Card/Drivers License/Employer Card/PAN Card. lightning. 5. etc.To meet the financial requirements towards Earnest Money deposit to book residential plots/ built up house/ flats being sold by Govt. 6. 2. Copy of Income Tax Returns for last two years. cooperative Housing Building societies. In case of default bank will be at liberty to get a policy renewed by debit to loan account of the borrower. Income proof. * Loan scheme for Earnest Money * In order to meet requirements of the public of Punjab and U. Proof of Residence – Any one of Ration Card/Telephone Bill/Electricity Bill/Voters Card. . Copies of all Property Documents. 3.Insurance: . it will be settled/referred under the Punjab Cooperative Societies Act 1961 or any other relevant act at the sole discretion of the Bank. earthquake. Documents required from the non-salaried individuals 1. HUDA and Housing Boars. Latest Bank Statement/Passbook (where salary/Income is credited for past 6 months). Documents required from applicants: Documents required from Salaried Individuals 1. Self attested recent passport size photographs of the applicant and co-applicant (two). 3. Disputes: . Proof of Identity – Any one of Voters Card/Drivers License/Employer Card/Passport/PAN Card. Latest Bank Statement/Passbook (where salary/Income is credited for past 6 months). 7. Copies of all Property Documents. Latest 3 months Salary Slip with all deductions & Form 16 for last 2 years. House fed and Improvement Trust. Proof of Residence – Any one of Ration Card/Telephone Bill/Electricity Bill/Voters Card. Copy of Income-tax Returns for last two years. the Cooperative Banks of launches one more. floods.T.
Borrower to give an authority that the representative of the bank is to collect refund order/letter of intent/ allotment letter on his behalf from the agency. No prepayment penalty will be levied. Interest will be charged initially for a period as stipulated by the concerned DCCB and will be non refundable. Two latest Photographs.As fixed by bank from time to time. 5. earnest money can be adjusted from the same. Documents 1. bak will charge interest as fixed by it. 3. In case of delay in allotment. Signature Proof.No security required.The Bank shall enter into agreement with the concerned housing agencies for collection of applications on behalf of the agencies and to get direct refund of unsuccessful applicants financed by the bank within specified time. Security : . refund of money beyond stipulated period . Repayment of Loan • • • • In case of unsuccessful candidates – on receipt of refund from the housing board/Urban development authority etc. In case of successful applicants – lump sum repayment. 2. Interest rate : . Bank may extent the period at its discretion by getting the amount of interest in advance. Two Post Dated Cheques in favour of the bank. repayment.No margin required.Beneficiaries: .Individuals of 21 years of age and above. Proof of residence in the form of copy of Passport. Loan agreement. borrower shall repay amount in lump sum on demand. Margin: . 6. otherwise bank will charge penalty. 4. In case applicant avails housing loan from the bank. .As per scheme of the agency. Maximum Loan : . In case of delay of allotment as per scheme. Driving License Voter’s ID Card etc. Processing Fee :. Disbursement: . Agreement with Housing Agencies : .As fixed by PSCB/ concerned DCCB.The loan would be disbursed by the issuance of draft/banker’s cheque favoring the concerned agency.
7. Power of Attorney. 8. Declaration for signing in vernacular language.
* Coop Rent Loan Against Rental Incomes Scheme *
Introducing a new scheme for property owners having their property situated in are of operation of the bank and who have let or proposes to et out such properties to PSUs, reputed Govt./Semi-Govt. corporate, banks, financial institution, insurance companies, cooperative societies, trust and MNCs. Eligibility: - Owners of the property who have or propose to let out the same companies/commercial/industrial/software companies, MNcs, Bank, PSUs/Reputed Govt.Semi-Govt. Institution/Organization, Financial Institution, Insurance companies. Owner of properties who have rented out their premises to cooperative bank are also eligible. In case of residential flats/house leased out to Cooperative Bank Officers. Note: - The facility is available only to resident customers and not NRIs. Purpose: - For meeting business/personal needs. Loan Amount: - Maximum to the extent of 75% of post TDS rent receivable for a period not exceeding 120 months or unexpired period of lease, whichever is less. (The rent receivable is calculated as per rental/lease agreement and if there is any inbuilt provision for increase in rentals during next 120 months or unexpired period of least/tenancy the same is considered for calculation of loan amount). The minimum loan amount under the scheme is Rs. 1.00 lacs. There is no upper limit but it must be within prudential exposure norms. Security : Primary : - Assignment of lease Rentals. Collateral: - Equitable Mortage of relative immoveable property to the extent of 150% of the proposed loan (For any reason if the relative property cannot be given as security any other commercial or residential property is acceptable. OR Other chargeable securities such as NSCs, IVPs, Bank’s deposits to the extent of 100% of loan amount. OR
150% cover partly by immoveable property and partly by securities such as NSCs, IVPs, Bank’s deposits. In case the property/security is in the name of third party, personal guarantee of the owner of assets proposed to be taken as collateral security. Rate of Interest: - As decided by the bank from time to time. Period of Loan: - Maximum period of loan shall be 10 years or unexpired period of lease, whichever is earlier. Repayment of Loan: - By way of equated monthly installments from the proceeds of monthly rentals, to be repaid within 120 months or unexpired period of lease, which is less. Margin: - Minimum 25% Processing Charges: - 0.50% of the loan amount. These are changed time to time. Insurance: - Insurance for full market value of properties in the name of borrower(s) to be mortgaged to bank with bank clause. Insurance to cover risk such as fire, riot, earthquake etc. Documents: 1. 2. 3. 4. 5. Loan application. Certified Copy of Less Deed. Proof of income for applicant and lessee. Copy of IT return. Certificate copies of title deeds of the properties leased out and mortgaged along with latest tax receipts. 6. Copy of approved building plan. 7. Authority letter by the borrower to the bank for receiving rent directly from the tenant/lessee and letter of undertaking from tenants/lessee to pay rent directly to bank. 8. Tripartite Agreement between borrower, lessee and the bank. 9. Copy of partnership deed/memorandum and articles of Association (not for individual applicant). 10. Copy of lease/tenancy agreement. 11. Copy of latest tax receipt of the property. 12. Latest IT/WT Assessment, if available. 13. Audited Balance Sheets of Firm/Company. 14. Certificate of outstanding balance in loan a/c against the property. 15. Copy of latest rent receipts ( in case existing tenant/lessee).
* Cash Credit Facility to Traders and Others *
Name of Cash Credit Facility to Traders and Others the Scheme Rule These Rules shall be called The Punjab State Coop. Bank / No.1 Central Coop. Bank rules for granting Cash Credit Facility to Traders and others. Rule 1. The bank means The Punjab State Coop. Bank Ltd., No.2 or Central Coop. Banks of Punjab. 2. The Board of Directors and the Executive Committee means the Board of Directors and Executive Committee constituted under the Bye-laws of the Bank. 3. Authorized Officer means the Officer authorized by the BOD/Executive Committee of the Bank to receive and take appropriate action on the applications for loans under the scheme. 4. Borrower means and individual, sole proprietor, firm, cooperative society or a company doing manufacturing/ trading business/providing services having an assured income. 5. Cooperative Societies Act means The Punjab Cooperative Societies Act,1961 as amended from time to time. 6. Cooperative Societies Rules means the Punjab Cooperative Societies Rule, 1963, as amended from time to time. 7. Registration means the Registration under the Shops Act or under Company’s Act. Cash Credit Facility under the Scheme shall be granted for meeting working capital requirements. The applicant should not have availed cash credit facility from any other financial institution for the purpose. The maximum amount of Cash Credit Limit under these Rules shall be Rs.25 lac. The application for cash credit limit shall be made by the borrower on the prescribed form of the bank. The sanctioning of the Cash-Credit by the Bank shall be made only in case it is satisfied of the viability of the Project /proposal. The borrower shall hypothecate in favour of the bank the entire current assets created besides collateral security of the value of 150% of the Cash Credit Limit sanctioned. Limit upto Rs.50,000/- may be granted with two good sureties only
Rule No.3 Rule No.4 Rule No.5 Rule No.6 Rule No.7 Rule No.8
Interest is charged as contract made with the loanee. The Bank shall be at liberty to call for additional/collateral security/securities at any time. Institutions and to encase the same.16 Failure to furnish stock statements will attract penal interest @ 2% p. purchases. sales and closing stock.and hypothecation of stock/assets with the Bank.12 Rule No. Borrower shall furnish stock statement as per following periodicity indicating the opening stock. At present rate of cash credit traders is 12% and further it shall be determined by financing bank from time to time and debited to loan account. Amount of limit upto Rs.1 lac – Monthly Rule No.9 Rule No. The Cash Credit Limit shall be sanctioned for a period of one year. Rule No.13 Rule No. fee. on upstanding amount for period of nonsubmission of statements. The Cash Credit Limit sanctioned should be kept current by regular drawls and repayments.11 Rule No. The legal expenses. The licensed contractors approaching the Bank for CashCredit Facility should give a power of Attorney in favour of the Bank to receive the cheque from Government/ Quassi Govt. In other words. Penal interest @ 2% over and above the normal rate shall be charged in case of default.14 Rule No. Aggregate credits during the year in the limit account should be two times of the sanctioned limit or highest availed limit. registration charges and other incidental charges incurred in connection with the financing shall be borne by the borrower. .10 The borrower shall produce clear marketable title to the property to be mortgaged in favour of the bank to the satisfaction of the bank.a. Renewal of the Cash Credit Limit will be allowed by the bank at its discretion based on the performance of the unit and also the operation in the cash credit limit account. the business transaction of the unit should be deposited in the Cash Credit Account.15 Rule No. 0.1 lac – Quarterly Above Rs.5% concession is allowed to women The borrower shall maintain the books of account as prescribed by the bank. on the default amount for the default period.
22 The borrower should insure the assets created out of loan and the policy should be in the joint name of the borrower and the bank with agreed bank clause.Agriculturists.17 Rule No. The borrower should be member of co-operative societies Loan Amount: . . The borrower shall be liable to make good of the expenses and legal charges that has been incurred by the Bank in this regard. Eligibility: .21 Rule No. limit. The Borrower shall execute all the loan documents prescribed by the bank. Processing fee @ 0.18 Rule No. Whenever the borrower fails to discharge the loan as agreed upon the Bank should take legal action against him to recover the loan outstanding with interest and cost.25% shall be levied every year.20 Rule No. The borrower shall agree to be bound by the provisions regarding arbitration in the cooperative Societies Act and Cooperative Societies Rules. Tenant farmers and Share Croppers who actually cultivate the lands are eligible for these loans.19 Rule No.Loan amount is worked based on the cost of cultivation incurred for each crop per acre of crop cultivated and 75 % of the cost of cultivation (Scale of Finance) is given as loan. The Borrower should become the nominal member of the bank by paying necessary membership fee as fixed by the Bank. Margin at the rate of 25% shall be maintained on the present value of stock.25% shall be charged at the time of sanctioning of the C. All categories of farmers .24 * Various Agriculture Loan Schemes * Agriculture loan provided in various forms for various agriculture purposes. The various types of agriculture loans are as under: - A) Short term agriculture loan Purpose: .Rule No. Rule No.23 Rule No.Small/Marginal (SF/MF) and others are included. These charges of 0. Deleted.Financial assistance to meet cultivation expenses for various crops.C.
helps in arranging inputs in time and facilitates access to the markets. pesticides etc) B) Medium Term Agriculture Loan Purpose: .The repayment period should not exceed 5 years.Borrower should be an agriculturist and own agricultural land either in his own name or in the name of his family members. Disbursement of the loan: . The acquisition of Two Wheelers by farmers increases their mobility. C) Two Wheeler Loan for Farmers Financing of Two Wheelers to farmers is considered as direct finance to agriculture.Cash Credit and Drafts. The Age of the borrower should not be less than 21 years at the time of application and not more than 60 years at the time of maturity (repayment of loan). The borrower should be member of co-operative societies. Land records to ascertain cultivation rights. reduces the cost of traveling.75 % of the cost of product (Scale of Finance) is given as loan. In case the sanctioned loan/limit exceeds Rs.He has his own land. . 000 security of agricultural land also to be taken. Sources of other borrowings e. The value of security including the value of vehicle should be at least double the value of loan. The borrower's repayment capacity is to be considered on the basis of crop grown.As per the cultivation requirements of the crop the loan amount is disbursed in cash and kind (for fertilizer.25.After 6 months. 3. saves their valuable time on travel. income from other sources and income of spouse Security: . The borrower should be member of co-operative societies Repayment: . 2.Hypothecation of vehicle to be purchased with bank loan. Loan Amount: . The salient features of the scheme are as under – Eligibility: .Documents needed to provide: 1.To purchase Trali and which are helpful in agriculture Eligibility: . Repayment of Loan: . Nature of Loan: . Acreage under different crop.g. Co-operative Societies and Banks. Bank has drawn a special scheme for financing of Two Wheelers to farmers.
The borrower should be member of co-operative societies. 000/- D) Cash Credit Fertilizers Purpose: . Nature of Loan: .The Age of the borrower should not be less than 21 years at the time of application and not more than 60 years at the time of maturity (repayment of loan). Terms & Conditions: .00 Lakh Repayment of Loan: 12/18 months. E) Cash Credit Limit to Cooperative Sugar Mills This is Scheme for Financing Farmers Growing Sugar Cane Crop in Tie up Arrangement with Sugar Mill Acting as Business Facilitator Purpose: To provide Crop Loans for cultivation of sugar Cane under tie up arrangement with Sugar Mills acting as Business Facilitator.The loan shall be repayable in 3 years depending upon the activity. Nature of Loan: Cash Credit Extent Of Loan: Need based Maximum Rs. the Bank has been giving loans for the Purchase of Tractors. Eligibility: .per hector only Repayment of Loan: . To be synchronized with harvesting of crop F) Tractor loan In order to mechanize farming and improve the output of the farmers.Cash credit and Cheque.50. 000/. Extent of Loan: .: .24.3. Eligibility: Farmers growing and supplying Sugar Cane .Limit: .To provide fertilizer to Farmers for production of crops.Cost of two wheeler to be purchased should not exceed Rs.Need based Maximum Rs.
Insurance of Tube well is necessary. Terms & Conditions • • Area should not be Dark.10% margin money & 5% shares) & with the second purchase30% of the total cost is to be spared by the loanee as down payment out of his own pocket. 16 blocks are Grey where there is some more scope for installation of new tubewells. G) Tube well Loan To bring the Barani unirrigated agricultural lands under irrigation. where tubewells to the full capacity have since been installed. The insurance of the tractor is must. Diesel Engine / Electric Motor should be ISI marked. Presently. The payment of the tractor is given to the Supplier Firm. Loan is given only for those Tractors which are Budhni tested and are ISI approved. In the purchase of the first Tractor the loanee has to spend 15% of the total cost of the Tractor (including shares . The tractor should be registered by the Transport Authority. For the purpose of exploitation of underground water. The repayment period for Tractor Loan is 9 years. The Bank is a major financier in the installation of tubewells in the Punjab State. as third party payment. the beneficiary availing loan should own or purchase a minimum of 3 Agricultural Implements (including Trailor) to be used with the Tractor. the bank has been giving loans for installation of shallow Tubewells to the farmers in the State. where there is greater scope for installing new tubewells. Unit cost varies from area to area according to the depth of underground water and credit is given up to the actual cost of tube well installation. but should be White or Grey for installation of new tube well. For the Purchase of the Tractor.• • • • • • • The work load with the owner of the tractor should be so that he has to use the tractor for at least 1000 hrs/year. and 38 blocks are White. Every 3rd Tubewell running in the field in the State is installed with the Credit help of this Bank. 84 blocks are Dark. the State has been divided into 138 blocks which are further earmarked as White. Repayment period is 9 years. • • • . with Grace period of 1 year. Grey and Dark.
the loan is provided for the following purposes : • • • • • Land Leveling Sand scraping Under-ground Pipe-lines Reclamation of Alkaline soils Reclamation of Shallow Ravine Details : Purpose Sand Scrapping (1 hectare) Underground Pipeline (1 ha) If water source is within the field Alkali Soil Reclamation (1 ha) Shallow Ravine Reclamation (1 ha) Units cost (in Rs. Chandigarh or from Punjab Government.000 10.. * Dairy Development Loan * .The Bank raises its resources with the collection of share capital strengthening on its owned funds by taking deposits and borrowings from the NABARD. Only ISI marked pipes and other material should be used Resources: . Punjab State Co-operative Bank Ltd. Punjab. Applications should be accompanied by the lay-out plan and estimate cost approved by the Soil Conservation Department.500 11.400 9. The loanee should have the proper irrigational facilities with him. The loan is to be returned within 9 yearly equal installments which includes 1 Grace year.H) Soil cultivation and water management Under this scheme.250 13. The loanee is advanced 85% of the total loan.) 14.000 Terms & Conditions: • • • Loan Applications under the above scheme be recommended by the Soil Conservation Department.
The applicant contributes minimum 15% of the total cost of animal as margin money. IV. Rate of Interest: . He should have sufficient experience/knowledge in dairy farming. The bank also has a greater role in the success of Dairy Farming in Punjab. II. 35000/. To increase the income and supply of milk to Cooperative Milk Producers societies. V. However margin for scheduled caste. Repayment of Loan: . To increase the income of members of Cooperative Milk Societies helping them to purchase higher yielding cattle.The bank shall charge interest @ 10. Under the Dairy Development Scheme.Dairy business has been very successful in Punjab.The loan shall be repay\able in 5 years in equal monthly installments along with interest.The Central Cooperative Bank through its branches shall extend loan facility for the purchase of one cow.or the animal whichever is less. Margin Money: . three. He should be the cultivating green fodder or should have definite arrangements for its supply. b. He should be the supplier of milk to the society during at least past one year. He should have cattle shed arrangements enough to house the existing animals and also proposed to be purchased. loans are provided to Individual/Milk Unions for the establishment of two.The bank shall provide loan for one cow with ceiling of rs. The bank's schemes have proved very beneficial for the rural areas of Punjab. . VI. Eligibility Criteria: I. Backward Class and Economically backward members shall be 10%. III. He should be the nominal member of the Central Cooperative bank.5 % per annum from the member of the Milk Producer’s Cooperative Societies which will be subject to change as per prevalent market rates from time to time. five and ten milch animals units as under: Objectives: a. Amount of Finance: . Minimum Economic Size: . The applicant should be a member of cooperative milk producer’s society.
After the application along with resolution of the society is received in the branch of the bank the branch manager shall apprise the loan case as the appraisal from (attached at Annexure “B”). Procedure to be followed: . If the managing committee approves the application then the president shall forward it to the branch manager of the branch of the central cooperative bank in whose area of operation the society falls. He shall sign and get signed tripartite agreement between the borrower the Cooperative Milk Producer’s society and the bank. He shall apprise project as per Performa annexed as Annexure “B”. Appraisal : .The members shall furnish the following security/document to the Central Cooperative bank. Guarantee by two persons who should be nominal members of the bank and who should be the owner of at least 2 acre of agriculture land.Securities/documents: . Time pronote b.An eligible person shall apply for the loan prescribed Performa attached as annexure “A” to the Branch Manager of central cooperative bank through the Village Milk producer Cooperative society. Hypothecation of milk animal to financed by the bank.The branch Manager of the central Coop. The President of the milk producer cooperative society shall place the application before the managing committee of the society for consideration of the application for its recommendation to the bank. a.The application form for dairy loan will be submitted by the member on prescribed from as per annexure ‘a’ through the Cooperative Milk Producer’s Society. After the execution of documents the manager shall get margin money deposits from the applicant in his saving bank account. d. Bank shall visit the farm to appraisal the technical feasibility and economic viability of the proposal. Application Form: . . c. After the appraisal of the loan case the branch manger will sanction the loan and get the necessary documents executed from the borrower. The manager shall disburse the loan through draft/pay order/cheque in favor of third party from whom the borrower has purchase cow by debiting the loan account for the amount of loan and saving account for margin money.
and according to market requirements bank increase and develop its products time to time like initially bank provide most of the agricultural loan schemes but now it also preferred . Also it has become quite difficult for a bank to a gain a unique market share. The service of loan granting is very fast under P. The Patiala Central Cooperative Bank also provide some non collateral loan schemes only on the basis of guarantee like personal loan scheme which benefited to a normal person. regulating and supervising banks. B.C.C. The main purpose of PCCB is to serving the people in both rural and urban area.B.C. Under PCCB most of the staff is old aged and there is a lack skills of new blood. Breadth.CHAPTER – V FINDINGS AND CONCLUSION Findings of the study o o o o o o o o Patilala Central Cooperative Bank is the district level bank and it has 43 branches in rural and urban areas to serve the all types of customers. Conclusion The repaid changes in the banking sector are creating opportunities and challenges.C. A loan can be passed into 3 or 4 days. The procedure getting a loan is very simple and understood able under P. complexity and geographic scope of banking have increased challenges of managing. Still the bank is old one. Increasing size. bear 50% share of the bank Most of the branches of PCCB are still non-computerized and employees are doing their work manually. PCCB is aided by NABARD and Punjab Govt.
to other types of loan schemes which really help to general people. . The bank should explain clearly all the terms and conditions of loans that the customer wants to avail in the local language and nothing should be concealed. the bank should inform him. 3. If the interest rate has been reduced or has become disfavourable to the customer. But to meet the competition of market in proper manner Patiala Central Cooperative Bank Ltd. and thus avoid inconvenience. CHAPTER – VI RECOMMENDATIONS Recommendations 1. The bank should act as per the standing instructions of the customers. Need some more hard work and management should pay more attention. 2.
11.4. 8. there is a great operation risk in the Bank and management should pay attention about it. 9. 5. Branches should be computerized. Since 1980 no recruitment made in this Bank. There should be complaint boxes installed in the bank that are opened weekly and proper redressal of complaints is done. Rate of interest should be reviewed periodically. All the counter staff should be thoroughly trained with all the schemes/rules and regulations of the bank. 12. The loan documents should be filled in the presence of the customer. 10. Staff should be recruited for smooth working. . PCCB should open new branches in the Rural and Urban Areas to achieve the targets. The bank should keep the information of the Account’s of the customer confidential. 13. In today’s world most of the banks provides ATM facility . 11 Single men Branches are functioning so. So to meet competition in the market PCCB should also provide the ATM facility. so that the customer gets one window service. 14. 7. 6. The sanction of rejection of the loan applied by the customer should be conveyed in writing.
html 13.html http://www. http://www.moneyguideindia.html 16. http://www. http://www. 4.com/what-are-co-operative-banks/ 8. http://www.in/PSCB.com/management/125039-1.scribd.in/Secbuscour/15. 5. http://www.php? page=1&submit.BIBLIOGRAPHY Bibliography I) Documents and Circulars 1. Previous years’ Reports are analyzed.com/banking/ucb.com/CMEdit/SFArtDis.punjabcooperation. 3.html 11.org/wiki/Procedure_(term) . 2.petra.in/html/pscb_history1.nios.allbusiness.com/loans-articles/importance-of-loans-in-todays-life184411. http://digilib. http://pbcooperatives.ac.x=0&submit.ac.gov. Documents and Circular II) List of Websites 1.html 14.htm 9. http://en.id/viewer.wikipedia.pdf http://finance.wikipedia.com/banking/bfunc.org/wiki/Banking_in_India http://www.banknetindia. 2.com/news/punjab_state_co_operative_bank_enhan ce_its_efficiency_by_means_of_flexcube 10.com/investment_in_india/banking_in_india.investorwords.articlesbase.indiamart. http://www.html http://en.ecommercejournal.asp? SFSNO=356&SFESNO=19 6.pdf 15.capitalmarket. http://www.htm 7.y=0&qual=high&fname=/jiunkpe/s1/hotl/2008/jiun kpe-ns-s1-2008-33403003-9666-food_lucky-chapter4. http://www.banknetindia. http://www.com/2858/loan.com/doc/17319280/CoOperative-Bank-Mgt 12.gov.
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