“A Summer Project Report on banking and Schemes ”

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)

DECLERATION

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)

ACKNOWLEDGEMENT
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.

Ankush Kumar

INDEX
PARTICULARS

PAGE NO.
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
o o

Name of Departments Various Branches of PCCB

120 61 – 62 63 – 68 CHAPTER – V : .FINDINGS AND CONCLUSION CHAPTER – VI : .IV: -ANALYSIS OF LOAN PROCEDURE & SCHEMES 61.RESERCH METHODOLOGY • • • • • 58 – 59 Definition 58 Research Design Objective of Study Collection of Data Limitations of Study 58 59 59 59 CHAPTER -.RECOMMENDATIONS BIBLIOGRAPHY 128-129 122-123 125-126 .o o o o Mission of the Bank: Objectives of Bank Technology Used In Bank Vision CHAPTER – III : .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 .

Bank is a lawful organization. Punjab National Bank. payment of foreign bills. savings were available for use whenever needed. 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. which can be met if some money is saved out of the present income. higher education of children. They used to hoard money in their homes. You will find that some are depositing money at one counter while some are receiving money at another counter. etc. It also lends money to individuals and business houses that need it. . They also need money to meet future expenses on marriage. 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. housing. The necessity of saving money was felt by people even in olden days. house building and other social functions. as we know people earn money to meet their day-to-day expenses on food. etc. You will see some employees sitting behind counters dealing with visitors standing in front of them. Banks also render many other useful services – like collection of bills. but it also involved the risk of loss by theft. Thus.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. These are heavy expenses. State Bank of India. Bank. This is the office of a ‘Bank’. people were in need of a place where money could be saved safely and would be available when 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. People who wish to borrow money for business and other purposes can also get loans from the banks at reasonable rate of interest.CHAPTER . With this practice. robbery and other accidents. Behind the counters in the office you will see tables and chairs occupied by officers. clothing. education of children. which accepts deposits that can be withdrawn on demand. 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. United Commercial Bank.

traders and businessmen for productive purposes. Withdrawal of deposit. banking is an important auxiliary to trade. Banks accept deposits from the general public as well as from the business community. whenever needed On deposits. relegating it to commercial banking functions. certifying the credit-worthiness of business. As we may be aware that there are laws which regulate the banking activities in our country. which they render to the business community and public in general. It promotes saving habits among the public. Thereby banks contribute to the economic development of the country and well being of the people in general. which adds to the original amount of deposit. Also banks depend a great deal on public confidence. It facilitates business activities by providing money and certain services that help in exchange of goods and services. Hence they enjoy the trust and confidence of people. They can keep their earnings from sales safely deposited in banks to meet their expenses from time to time. History of Banking Banking industry in India originated in the last decades of the 18th century. Safety of deposit. and so on. ‘Banking’ as an activity involves acceptance of deposits and lending or investment of money. On the basis of deposits banks also grant loans and advances to farmers. Central banking is the responsibility of the Reserve Bank of India. Therefore. Businessmen have income from sales out of which they have to make payment for expenses. 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. . Depositing money in banks and borrowing from banks are legal transactions.safe-keeping of jewellery and other valuable items. the Reserve Bank was nationalized and given broader powers. 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. It not only provides money for the production of goods and services but also facilitates their exchange between the buyer and seller. which in 1935 formally took over these responsibilities from the then Imperial Bank of India. Banks also charge fees for the various other services. Banks also charge interest on loans. It is a great incentive to the depositor. and b. The oldest bank in existence in India is the State Bank of India. After India's independence in 1947. Banks are also under the control of government. In 1969 the government nationalized the 14 largest commercial banks. banks give interest. the government nationalized the six next largest in 1980. Banks give two assurances to the depositors – a. a government-owned bank that traces its origins back to June 1806 and that is the largest commercial bank in the country. Without public confidence banks cannot survive. Any one who saves money for future can deposit his savings in a bank.

I prefix the scenario as Phase I. During the first phase the growth was very slow and banks also experienced periodic failures between 1913 and 1948. Second phase of nationalisation Indian Banking Sector Reform was carried out in 1980 with seven more banks. 14 major commercial banks in the country was nationalised. To streamline the functioning and activities of commercial banks. Seven banks forming subsidiary of State Bank of India was nationalized in 1960 on 19th July. Bank of Baroda. Bank of India. There were approximately 1100 banks. 23 of 1965). This step brought 80% of the banking segment in India under Government ownership. mostly small. It was the effort of the then Prime Minister of India. 1949 which was later changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No. Indira Gandhi. In 1865 Allahabad Bank was established and first time exclusively by Indians.To make this write-up more explanatory. major process of nationalizations was carried out. the Government of India came up with The Banking Companies Act. These three banks were amalgamated in 1920 and Imperial Bank of India was established which started as private shareholders banks. mostly Europeans shareholders. it nationalized Imperial Bank of India with extensive banking facilities on a large scale especially in rural and semi-urban areas. 1969. Phase II and III Phase I The General Bank of India was set up in the year 1786. and Bank of Mysore were set up. Abreast of it the savings bank facility provided by the Postal department was comparatively safer. The following are the steps taken by the Government of India to Regulate Banking Institutions in the Country: • • 1949 : Enactment of Banking Regulation Act. was set up in 1894 with headquarters at Lahore. Indian Bank. Phase II Government took major steps in this Indian Banking Sector Reform after independence. 1955 : Nationalisation of State Bank of India. Next came Bank of Hindustan and Bengal Bank. In 1955. Mrs. Reserve Bank of India was vested with extensive powers for the supervision of banking in India as the Central Banking Authority. Between 1906 and 1913. Moreover. . Bank of Bombay (1840) and Bank of Madras (1843) as independent units and called it Presidency Banks. Canara Bank. Punjab National Bank Ltd. During those days public has lesser confidence in the banks. The East India Company established Bank of Bengal (1809). Central Bank of India. As an aftermath deposit mobilization was slow. funds were largely given to traders. Reserve Bank of India came in 1935. 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.

the branches of the public sector bank India rose to approximately 800% in deposits and advances took a huge jump by 11. 1969 : Nationalisation of 14 major banks. According to a report by ICRA Limited. the public sector banks hold over 75 percent of total assets of the banking industry.5% respectively. with the private and foreign banks holding 18. 90.crores. In 1991. a rating agency. 31 private banks (these do not have government stake. 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. 000/. It is expected that there will be large additions to the capital base and reserves on the liability side. 1971 : Creation of credit guarantee corporation. The total assets of all scheduled commercial banks by end-March 2010 is estimated at Rs 40. The country is flooded with foreign banks and their ATM stations.4 per cent during the rest of the decade as against the growth rate of 16. Efforts are being put to give a satisfactory service to customers. 1961 : Insurance cover extended to deposits. The entire system became more convenient and swift. They have a combined network of over 53.• • • • • • 1959 : Nationalisation of SBI subsidiaries. 1980 : Nationalisation of seven banks with deposits over 200 crore. Phase III This phase has introduced many more products and facilities in the banking sector in its reforms measure.7 per cent that existed between 199495 and 2002-03.000 ATMs. takeovers. Based on the projections made in the "India Vision 2020" prepared by the Planning Commission and the Draft 10th Plan. One may also expect M & As. a committee was set up by his name which worked for the liberalisation of banking practices. they may be publicly listed and traded on stock exchanges) and 38 foreign banks.000 branches and 17. Banking in the sunshine of Government ownership gave the public implicit faith and immense confidence about the sustainability of these institutions. . After the nationalisation of banks. Bank assets are expected to grow at an annual composite rate of 13. That will comprise about 65 per cent of GDP at current market prices as compared to 67 per cent in 2002-03.2% and 6.27 public sector banks (that is with the Government of India holding a stake). under the chairmanship of M Narasimham. With the growth in the Indian economy expected to be strong for quite some timeespecially in its services sector-the demand for banking services. Time is given more importance than money. the report forecasts that the pace of expansion in the balance-sheets of banks is likely to decelerate. Currently. 1975 : Creation of regional rural banks. and asset sales. especially retail banking.000%. India has 88 scheduled commercial banks . mortgages and investment services are expected to be strong. Phone banking and net is introduced.

draft. where NPAs are of a very high order. the regulation traditionally has been very strict and in the opinion of certain quarters. which is also intended for banking professional. sometimes bordering on illogical. responsible for the present condition of banks. attempts to give an overview of the functions in as simple manner as possible. repayable on demand or otherwise and withdrawal by cheques. Since Banking involves dealing directly with money. Transferring money from one place to another (Remittances) . Lending money to public (Loans) 3. In India. 1949 defines Banking as "accepting. The multiplicity of policy and regulations that a Bank has to work with. Banking Regulation Act of India. Accepting Deposits from public/others (Deposits) 2. 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. order or otherwise.Banking Institution Functioning of a Bank Functioning of a Bank is among the more complicated of corporate operations. governments in most countries regulate this sector rather stringently. makes its operations even more complicated." Deriving from this definition and viewed solely from the point of view of the customers. This section. The process of financial reforms.

a bank must possess: • • • • • • • Sufficient deposits.from one place . comfortable environment etc.4. For effective functioning of this. Remittance Apart from accepting deposits and lending money. But since the Banks use this money to earn interest from people who need money. Review of credit portfolio. Banks share a part of this interest with the depositors. Legal skills for recovery of its dues through the courts. Acting as trustees 5. the money is accepted as deposit for safe keeping. Accepting deposits is one of the two major activities of the Banks Banks are also called custodians of public money. This activity places its own requirements on the resources of the Bank. An effective credit delivery system. Lending money to the public Lending money is one of the two major activities of any Bank. In a way. Legal skills for documentation.both domestic and foreign. The corporate office of a bank is normally called Head Office. 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. 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. Keeping valuables in safe custody 6. Basically. Skills to appraise the potential borrowers and the activity. on behalf of their customers the act of transfer of money .. stationery. accepting deposits and keeping track of the money involves a lot of book-keeping and other operations. Government business Banks are organized in a linear structure to performed these activities at the base of which lies a Branch. Banks also carry out. Skills to follow up and monitor the end-use of money lent by it. However.

security of valuables is provided through making secured space available to general public for keeping these valuables. 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. 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. for transferring the money. 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. To deliver this service. The latter are small compartments with dual locking facility built into strong cupboards. This activity is known as "remittance business" . While security of money is taken care of through offering various type of deposit schemes. To make this facility available to its customers. Both must come together and use their respective keys to open the locker. These are stored in the Bank's Strong Room and are fully secure. the Bank must provide: • • • • Physical structures to house the lockers Locker cabinets Security arrangements Record of access to lockers Government Business . Banks must possess the following to be effective and retain that: • • • A track record of sufficient length. Facilities for safe keeping. Banks issue Demand Drafts. These spaces are available in the shape of LOCKERS. Banks also have the facility of quick transfer of money also know as Telegraphic Transfer or Tele Cash Orders.to another. a Bank must have: • • • • An effective branch network or correspondent relationships. Money Orders etc. For example. While Banks are the natural choice for the customers. 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. Banker's Cheques. Lockers can neither be opened by the hirer or the Bank individually.

houses. 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. co-operative banks finance small borrowers in industrial and trade sectors. They play a significant role in the economy of a nation. to cater to the numbers Role of Banking Banks provide funds for business as well as personal needs of individuals. It acts as an intermediary between people having surplus money and those requiring money for various business activities. Most of the Government disbursements like pension payments and tax refunds also take place through banks.Earlier Government business used to be exclusively carried out by Government Treasuries where all type of transactions took place. Co-operative banks are regulated by the . now Banks act on behalf of the Government to accept its tax and non tax receipts. supply of credit and provision of remittance facilities. etc. It also facilitates import export transactions. However. In India. It facilitates business transactions through receipts and payments by cheques instead of currency. It helps in raising the standard of living of people in general by providing loans for purchase of consumer durable goods. besides professional and salary classes. small-scale industries and self-employed people as well as to large business houses which lead to balanced economic development in the country. They provide limited banking products and are specialists in agriculture-related products. automobiles. Let us know about the role of banking. It helps in national development by providing credit to farmers. stationery etc. providing this service requires a lot of effort and organisation. • • • • • • • It encourages savings habit amongst people and thereby makes funds available for productive use. Cooperative banks perform the main banking functions of deposit mobilisation. It provides loans and advances to businessmen for short term and long-term purposes. 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. While the Banks carry out this business for a fee to be paid by the Government.

Co-operative bank do banking business mainly in the agriculture and rural sector. from urban to rural. and CCBs operate in semi urban. 1965. SCBs. self-help. The scheduled UCBs. Reserve Bank of India and NABARD. Intra-sect oral flows of funds are much greater in cooperative banking than in commercial banking. ownership funds and deposits or debenture issues.Reserve Bank of India and governed by the Banking Regulations Act. and government-subsidized financial agency in India. co-operative banks now provide housing loans also. Rural co-operative banks are regulated by state registrar of co-operatives. A Historical Perspective . 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. urban. For commercial banks. the Reserve Bank of India is lender of last Cooperative Movement in India . function on "no profit. and metropolitan areas also. UCBs provide working capital loans and term loan as well The State Co-operative Banks (SCBs). can lend upto Rs 3 lakh for housing purposes. 1949. one vote". however. while the commercial banks. However. They get financial and other help from the Reserve Bank of India NABARD. no loss" basis. The urban and non-agricultural business of these banks has grown over the years. UCBs. However. Central Co-operative Banks (CCBs) and Urban Co-operative Banks (UCBs) can normally extend housing loans upto Rs 1 lakh to an individual. and mutual help. supply of credit and provision of remittance facilities. Co-operative banks. They constitute the "most favored" banking sector with risk of nationalization. Co-operative bank performs all the main banking functions of deposit mobilization. governmentsupported. The co-operative banks demonstrate a shift from rural to urban. Co-operative Banks provide limited banking products and are functionally specialists in agriculture related products. do not pursue the goal of profit maximisation. and Banking Laws (Co-operative Societies) Act. The sources of funds for co-operative banks are: central and state government. as a principle. The UCBs can provide advances against shares and debentures also. central government and state governments. They function with the rule of "one member. other co-operative institutions. Co-operative banks are perhaps the first government sponsored. Inter-bank deposits.

The Cooperative Societies Act of 1912 recognized the formation of non-credit societies and the central cooperative organizations/federations. transport. dealing directly or indirectly with agricultural sector. respectively. The state patronage to the cooperative movement continued even after 1947.. Based on the recommendations of Sir Frederick Nicholson (1899) and Sir Edward Law (1901). dairy and sugar cooperatives have made India a major nation in the world with regard to milk and sugar production. distribution/marketing.The Indian cooperative movement. which examined the problem of rural credit subsequently.. The Rural Credit Survey Committee (1954). which stated that . Various expert committees. the first comprehensive enquiry into problems of rural credit. housing. but cooperation must succeed. Of the primary (village) level cooperatives.the cooperative society has an important role to play as the most suitable medium for the democratization of economic planning. irrigation. production. textiles and even industries. after a detailed examination of the entire gamut of issues including the social ethos of rural society. to cooperatives at the village level. summed up its findings in the celebrated dictum that . that in the Indian context.Raiffeisen. there is no alternative from the point of view of structural appropriateness. and Schulze Delitzch. The policy of the Government towards the cooperative movement was guided by the recommendations of the Saraiya Committee. the year in which India attained freedom. the Cooperative Credit Societies Act was passed in 1904. Today. warehousing. banking. In fact. account for 36 percent of the total distribution of . 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. without exception. like its counterparts in other countries of the world has been essentially a child of distress. paving the way for the establishment of cooperative credit societies in rural and urban areas on the patterns of . have come to the same conclusion. around 28 percent with 137 million memberships are agricultural cooperatives. Cooperatives supply about 46 percent of the total rural credit (including agricultural credit). the cooperative movement has entered several sectors like credit. During the last century. India can claim to have the largest network of cooperatives in the world numbering more than half a million. with a membership of more than 200 million. the cooperatives in India have made remarkable progress in the various segments of Indian economy. The independent India accepted the concept of planned economy and cooperative organizations were assigned an important role. processing. Since 1950s.cooperation has failed.

. 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. Historically. Paradoxically. 3. perhaps. defeating the very objectives of these institutions. lack of active participation of the members in the management. curiously. Though cooperative movement has made remarkable progress in several areas. The state partnership is. (iii) ineffective lending and (iv) poor recovery.fertilizers. 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. 2. With regard to agricultural cooperative credit structure. The acknowledged operational deficiencies of the cooperative credit structure have been (I) weak recycling of credit. Dormant membership. the cooperatives have achieved success to an extent but there are larger areas where they have not been so successful. the growth and development of the Indian cooperative movement is heavily tilted in favour agricultural cooperatives in general and in particular. In some areas like dairy. 6. the unique feature of the Indian cooperative movement. 5. this has resulted in weakening of the cooperative edifice. the movement continues to suffer from structural defects and operational deficiencies. Governments and policy makers have paid more attention to agricultural cooperatives and thus. 4. in a way. The cooperative credit movement in modern India. undue political and bureaucratic intervention. 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. certain glaring defects have also developed in the movement. The following are the unique features of Indian cooperative movement:1. As of today. produce about 55 percent of the total sugar and constitute for 28 percent of the rural fair shops (distributing consumer articles). which have been. is a state initiated movement. Government contribution to the share capital of primary agricultural cooperatives accounts for about 7. their increasing officialization and politicization culminating in virtually depriving the cooperatives of their vitality as well as their democratic and autonomous character. Understandably. lack of professionalism (and absence of corporate governance).5 percent of the total . although the quantitative expansion has been somewhat satisfactory. have made majority of the cooperatives at the primary level almost moribund. (ii) poor resource mobilization. credit cooperatives. urban banking and sugar.

only State Cooperative Apex Banks. Interestingly. 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. The first is the short term lending oriented Co-operative Banks. At the central level (district level) District Central Cooperative Banks (DCCB) function as a link between primary societies and State Cooperative Apex Banks (SCB). In other words. The rural credit cooperatives may be further divided into short-term credit cooperatives and long-term credit cooperatives. However. District Co-operative banks and the Primary Agricultural Co-operative societies. The cooperative credit institutions in the country may be broadly classified into urban credit cooperatives and rural credit cooperatives. at the grass-root level there are around 92.000 Primary Agricultural Credit Societies (PACS) dealing directly with the individual borrowers. 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. With regard to short-term credit cooperatives. under the Banking Regulation Act 1949. The organizational structure of the credit cooperatives in India is illustrated in chart I. 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. . Types of a Co-operative Bank There are two types of co-operative banks in India.Cooperative Banking in India Credit cooperatives are the oldest and most numerous of all the types of cooperatives in India. only these banks are licensed to conduct full-fledged banking business. 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. District Central Cooperative Banks and select Urban Credit Cooperatives are qualified to be called as banks in the cooperative sector. As against three-tier structure of short-term credit cooperatives. The urban credit cooperatives are also popularly known as Urban Cooperative Banks.

The first phase of the .The second is the long term lending oriented Co-operative banks. the second is district level. Land Development Banks. District Central Co-operative Banks. The objectives of the reform program have been to remove the structural constraints in the factor and product markets. and the sector is dominated by the banking sector which accounts for about two-thirds of the assets of the organized financial sector. Primary Urban Co-operative Banks. Primary Agricultural Credit Societies. First is the state level. 2. In this second category there are land developments banks which are at three levels. State Co-operative Banks. The financial system in India has built up a vast network of financial institutions and markets over time. and the third is the village level. Again the Co-operative banking structure in India is divided into five main categories and these categories are: 1. 3. It is very much clear that co-operative banks have very much importance in national development. 5. 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. as a step towards a broader process of international economic integration and globalization of financial markets. Without the help of co-operative banks. A healthy financial system being the principal pre-requisite for the globalization process. the banking sector being an important component thereof came into sharper focus. 4. 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. 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.

Thematic Framework for Analysis: The literature relating to the economic reforms. However. needless to mention. This apart. Therefore. improving the quality of supervision. income recognition. 1998) provides a framework for the second phase of reforms in the banking system. 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). an important component of the banking system was a natural corollary as the weaknesses in cooperative segment could pose systemic risks. asset classification and provisioning norms were made applicable to cooperative banks in a phased manner. 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. impact of reforms on cooperative sector. banking reforms and its impact on credit cooperatives and so on are rather opulent.current reform of the financial sector was initiated in 1992 based on the recommendations of the Committee on Financial System (CFS. Accordingly. particularly prudential standards to cooperative banking institutions. 1992). cooperative reforms encompassing legal and administrative aspects have not taken place in India. deregulation of interest rates. The report of the Committee on Banking Sector Reforms (CBSR. enabling the latter to function on sound lines at par with other banking institutions. Though cooperative banks operate at the district and state level. partial removal of selective credit controls. gradual removal of pre-emptions (reduction in CRR and SLR). The progress that has been made in a substantial. The extension of reforms. The broad features of the on going banking reforms have been. prudential standards covering capital adequacy. the urgency and importance for extension of the reforms need hardly be emphasized keeping in view of their reach and scale of operations. In . competition and transparency. the succinct objective of the banking sector reforms has been to improve the efficiency in the system by introducing an element of competition. 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. the banking sector reforms could be treated as complete only if it encompasses the cooperative segment. tightening of prudential standards. assistance to banks in debt recovery and reforms in money and forex markets.

in practice. Thus. . all through the discussion. 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. Using this normative analytical framework. which is different from the one usually used for capturing the impact of reforms on cooperatives. even if one attempts. The analytical framework for the aforesaid purpose rests on three basic assumptions. For the sake of research. the conclusions could be abstruse. a general discussion on the impact of reforms (economic or banking sector) on cooperative character would be almost impossible. be it in credit or non-credit segment. While the difficulties in examining the impact of reforms on the cooperative character of cooperatives are quite understandable. 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. However.so far as the impact of reforms on the cooperative character of the cooperatives is concerned. much more closer to cooperative principles than cooperatives themselves. one may safely say that neither the policy makers nor the researchers have shown any serious interest. It seems the cooperative researchers. And this is particularly true in India. Given the diversity that prevails today in the cooperative sector and the levels of reforms thereof. 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. What is required perhaps is a normative analytical framework. it is attempted to maintain a special thrust on the cooperative character of UCBs. c) Cooperative character of urban cooperative banks can be captured in terms of the adherence to cooperative principles. 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. Ramesha (1996) in his empirical study points out that Self Help Groups (SHGs) which are not registered as cooperatives are. it does not mean the same can not be attempted meaningfully.

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. is used to denote that the urban cooperative banks perform the role of a primary unit in a 3-tier cooperative credit structure.Urban Cooperative Banks in India Inspired by the success of urban cooperative movement in Germany and Italy. In so far as the growth and performance are concerned. Over a century old urban cooperative credit movement today. by 27. Accordingly. also used the word . tightening prudential standards and .1 Mn) and (iii) the by-laws of which do not permit admission of any other cooperative society as a member. The word . For instance. 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. were essentially credit societies but later converted themselves into urban cooperative banks. Many urban cooperative banks. and a host of factors may be responsible for this which may include increasing competition. has a network of 2. 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. 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. an urban cooperative bank was defined as a Primary Cooperative Bank other than a primary agricultural credit society. 2001). although owned fund. i. Interestingly.1 lakh (0. many urban cooperative credit societies. the performance of the urban cooperative banks particularly after 2000 has been on the decline. 15 and 14 percents respectively.084 urban co-operative banks with 7. when banking laws (provisions of section 5(CCV) of Banking Regulation Act 1949) were made applicable to cooperative banks.368 branch outlets spread all over the country.e. However. (i) the primary object of which is the transaction of banking business. (ii) the paid up share capital and reserves of which are not less than Rs. deposits and advances of urban cooperative banks increased somewhat impressively. between 2001 and 2002.primary. There was no well-defined concept of urban cooperative bank till 1996. the gross Non Performing Assets (NPAs % to total advances) during the same period went up from 16 to 22 percent (3). The percentage of the profit making urban cooperative banks to the total stood at 87 percent as at the end of March 31. then the scenario undergoes a complete change. 2002. which were not engaged in any banking functions. 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. in the early part of the last century. This is partly on account of historical reasons and partly due to the preferential treatment of cooperative structure in general. which were organized initially.bank.. On the whole.

the urban cooperative banks are not surviving on external assistance such as refinance support.supervision and regulatory standards. 5) A noticeable feature of urban banking sector is its financial independence. Nearly 50 percent of the banks are unitary in nature (with single branch banking). etc. 3) UCB structure is exemplified by its pronounced focus on the needs of small men and micro credit sector. 1) Urban cooperative banks are registered under Cooperative Societies Act of the respective state Governments.duality of control. 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. multiple control. The Reserve Bank of India (Central Bank of the country) is the regulatory and supervisory authority for UCBs for their banking related operations. The Union Government regulates the UCBs having multi-state presence and such banks are registered under Multi-state Cooperative Societies Act. Unlike the agricultural cooperative credit structure. UCBs have been supporting federal units (District Central Cooperative Banks and State Cooperative Banks) by keeping their surplus resources in the form of deposits. Following are the features of urban cooperative credit banks in India. 4) Urban cooperative credit movement in general. Controlling of UCBs by state Government and the Central Bank of the country is generally known as . Banking Sector Reforms and Urban Cooperative Banks: The reform measures as applicable to UCB sector may be classified into three broad . Heterogeneity in their size is another facet of the UCB structure. trade & business. 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. In fact. and the number of UCBs in particular is concentrated in few states. housing etc) set by the central bank of the country.. 2) The discernible characteristic feature of UCB structure is its heterogeneity. 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. Managerial/Administrative aspects of UCBs continue to remain with the state Governments.

policy initiatives have been introduced (through Monetary & Credit Policies) to contain the systemic risk emanating from cooperative sector. Although. these banks will have to start dealing with non-members (or nominal members) on a large scale and perhaps may have to shift from . the notion of a code of good practices is intuitively appealing. Prudential Standards: To begin with. The influence of the reforms on the functioning as well as the cooperative character of UCBs is discussed below. Lastly. steps are also being initiated to professionalize the management and manpower of UCBs.surplus. For instance. albeit in a phased manner. different stages of development must be avoided. as a typical cooperative created on the basis self help and mutual help. To put it differently. the focal point of the reforms has been prudential norms. capital is widely regarded as a measure of the risk taking ability of a financial intermediary and therefore.. In 1995. are not permitted to . urban cooperative banks though on par with commercial banks with regard to prudential standards. Subsequently. legislative frame work and more broadly. a majority of the prudential norms introduced for commercial banks are being extended to UCBs. as it is happening in India. asset classification. then possibly the members (generally with limited means) may not be able to raise the required capital. 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. duality/multiplicity of control has been recognized as an irritant to their effective regulation and supervision. it should not be forgotten that such standards were contrived essentially for commercial banks. It is worth mentioning that in India. 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. Although. the temptation to prescribe universally valid model codes which do not allow for differences in institutional development. Second. in particular of the UCB sector). to . while recognizing the differences between commercial and urban cooperative banks. the capital adequacy norms (capital to risk weighted asset ratio) were also made applicable to UCBs. income recognition and provisioning norms). the prudential exposure norms to single/group borrowers were also made applicable to them. in a phased time frame. like the latter. If capital base is to be strengthened. 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. it is not yet clear. while there is no dispute that UCBs should be subjected to prudential standards (capital adequacy. in particular from UCB sector.categories. RBI introduced Income Recognition and Asset Classification Norms to UCBs. in 1993. If one looks at a cooperative credit society/bank.profit. First.

Secondly. investment. is the dilution in the cooperative character (in terms of adherence to the principles). Nonetheless. credit. the former may have to progressively imbibe the character of the latter (identity crisis?). the strict entry norms in terms of minimum capital. in order to ensure the adherence to the prudential standards by cooperative credit societies/banks. for managing a financial intermediary. in India regulator’s intervention has indirectly infringed upon the functional autonomy covering areas like share-linkage.boost their capital base through sub-ordinate debts. While this is to some extent true. prevents the birth of new credit cooperatives and constrain the existing societies in so far as the expansion is concerned. While one can not remain ignorant of the role of the Government in the promotion of and development of cooperation in India. 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. needless to mention. interests (majority of them are not the members) in the case of urban cooperative banks. deposit and so on. It is disheartening to note that the . Further. Fourthly. 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. the human resource comprising of paid staff and elected management has to be highly competent. the regulator’s frequency (as also scope) of intervention increases thereby affecting the cooperative character. Quite often the reason quoted is that there is lack of qualified and competent directors and the protection of depositors. with the introduction of same prudential standards the difference between urban credit cooperatives/banks and commercial banks get blurred and possibly. whether a cooperative or a commercial bank (irrespective of its size). membership prescription as it prevails in India. prescribing the number and qualification of the nominee directors would no doubt impair the cooperative character. There could be several such dimensions as discussed above. Thus. However. the solution to this problem certainly is not Government intervention as it would seriously impair the cooperative character. in the name of protecting the interests of the depositors (majority of whom are not the members of cooperative banks). Thirdly. Fifthly. Professional Management and Governance: Good corporate governance is critical to efficient functioning of an entity and more so for a banking entity. there are ceilings on the value individual share holdings have not been revised since long. The cost. Thus the need for professional management and healthy governance practices in urban credit cooperative societies/banks in the present competitive environment needs no emphasis. In this regard. 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. it appears that the benefits of the prudential standards to urban credit cooperatives/banks come at a cost.

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. Supervision and Regulation: At present in India. urban credit cooperatives/banks are subjected to duality of control. 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. 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. 37 % of State Cooperative Agricultural and Rural Development Banks. Given the number of urban credit cooperatives/banks. the duality of control not only affects the quality of supervision and regulations. In this regard. 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. understandably resulted in overlapping jurisdiction of the state Government and the central bank of the country. Thus. Perhaps. Given this. the following issues/areas may be of some interest to the cooperative researchers. 21 % of the District Central Cooperative Banks and 8% of Primary Cooperative Agricultural and Rural Development Banks stood superseded as on March 2000.policy/strategy. the central bank of the country is not in a position to effectively supervising them. but also the functioning of the urban cooperative . Moreover. More than 200 urban cooperative banks are identified as weak/sick banks by the regulator as at the end of March 2002. 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. investment management. 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. This has. marketing plan/strategy. the need of the hour is to ensure that in cooperative organizations. 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.elected management of 41 % of State Cooperative Banks. It is this management committee which is entrusted with the responsibilities like risk management . Asset-Liability Management and so on. credit and NPA management. in the case of co-operative banks it requires the intervention of the Registrar of Cooperative Societies (state Government).

It must not be forgotten that the notion of a code of good practices though intuitively appealing. The framework for such research should essentially be within the guiding principles of cooperation.banking sector. it is yet not clear as to whether the same would ensure soundness and stability in the cooperative banking segment. legislative framework and more broadly. However. Although the promotion of prudent financial practices in urban cooperative banks has become a sine quo non in the present competitive environment. Needless to mention. under this regime of duality of control the urban cooperative banks may turn out to be neither cooperative nor commercial banks. With regard to the extension of reforms to cooperative banking segment. the temptation to prescribe universally valid model codes which do not allow for differences in institutional development. some of them may be good for research as well. . one can not afford to ignore that such practices were contrived essentially for commercial banks. more important amongst them are prudential standards. if cooperative character of credit cooperatives is to be preserved. affecting the cooperative character in terms of adherence to the cooperative principles. There are several areas that need the intervention of researchers and perhaps. While the progress of the cooperative movement in India in general. then there would not be any difference worth mentioning between these entities. professional management & governance and supervision & regulation. system of governance and supervision & regulation all should emanate from the guiding principles of cooperation. There are some areas of concern. different stages of development must be avoided. the movement can not be termed as a vibrant one in regard to cooperative values and philosophy as enunciated in cooperative principles. Logically. It seems the extension of reforms/prudential standards to urban cooperative banking has provided substantial scope for the external intervention and in the process. and supervision and regulation for cooperative banks were same as that of commercial banks. if the prudential standards. the prudent practices. in the long run. and the cooperative banking in particular has been rather appreciable.

The organizational structure is as under:- . the position of the Punjab State Cooperative Bank is extremely important as the whole credit system revolves around it. Jalandhar & Bathinda. It has 3 Divisional Offices at Amritsar. 1949 at Shimla vide registration No. Organizational Structure The bank operates in the city of Chandigarh having 19 branches and 3 extensions Counters. In the cooperative Banking structure. The bank was established to help to provide timely and adequate flow of credit to the farmers for agriculture and allied activities through PACS. there are 19 District Central Cooperative Banks having 783 branches and 16 extension counters in the State of Punjab affiliated with it.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. 720 has a principle financing institution of the cooperative movement in Punjab. Bhatinda and Jalandhar. 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 19 branches and 3 extensions counters operating in the city of Chandigarh. It has 3 Divisional Offices in Punjab at Amritsar.

loans and overdrafts from the Reserve Bank of India.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. deposits. Expectation of the bank from the public for enhancing its effectiveness and Efficiency:- . State cooperative banks lend money to central co-operative banks and primary societies and not directly to farmers. Its funds are obtained from share capital.

The Bank expects that the general public should take maximum benefits of the services offered by it. Annual Cooperative Week celebrations during the month of November every year. There is a statutory audit system in the Bank by the Auditors.& Date. Punjab. HEAD OFFICE. The profile of Patiala Central Cooperative bank is as under:• • • • • Name of society. 28th September 1949 Area Of OperationAs per bye-law no. THE PATIALA CENTRAL CO-OPERATIVE BANK LTD. under the control of Chief Auditor. The affiliated Co-operative societies by. It will be in the interest of the public also. . 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. 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. District and State level Technical Committees are established to fix the scales of finance of various crops. Cooperative Societies. Registration No. 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. deposits. Providing Banking and credit facilities to its members as convenient and easy terms are possible. These banks finance member societies within the limits of the borrowing capacity of societies. loans and overdrafts from state co-operative banks and joint stocks. 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. NABARD and State Govt.The Patiala Central Co-Operative Bank Ltd. To properly handle the public grievances/complaints.No. 3. 772. The Bank is regulated and inspected by Reserve Bank of India. Customer meets Annual General Body meeting. the object of the Bank is to Facilitate the operation of. The funds of the bank consist of share capital. Encouraging thrift and saving amongst its members by offering suitable facilities. a separate Vigilance Cell has been created at the Head Office of the Bank. 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.

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. Samana. Directors to be elected out of the remaining Co-operatives societies. The No. 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 . Patran. Nabha. Management and Organizational Structure As per bylaws No. Ghanour and Sanour. Nabha and Rajpura. Under the Indian Co-operative Societies Act-ii of 1912 the P. Sr. The copy of the application submitted for its registration shows Patiala and Sangrur district as area of operation of the Bank.B with registration no. One Director to be elected out of member industrial Cooperative societies. Eight Directors to be elected out of members Co-operative Marketing cum processing Societies.C. Undertaking such measures as are conductive to the spread of Co-operative education and training. There are 8 Blocks Patiala. is member. 28 the Board of Directors shall be constituted as under • • • Three Directors to be nominated by Govt. Samana. With the creation of new district of Mohali . Co-operative Societies PEPSU although the old bylaws do not mention that area of operation of the Bank. of these societies exceeds fifty-one. In case. so long as the Govt. Rajpura. Dera Bassi block transferred to that district. There are 4 Sub-divisions namely Patiala.C. 776 on 28-09-1949 by the registrar co-operative. Bhunerheri.• • Making arrangement for supervision and inspection of its affiliated Co-operative Societies.

That department issues the drafts of local. its functions & number of members working in the departments. Statements of NABARD. To maintain Misc. Here we tell us about those departments / sections which play important role in Banking. We tell about his Head of Department.B. To maintain several records (with service book of employees) Transfer of employees. GI. and House Loan.A. This department keeps up the current A/C related with commercial bank. Functions of Various Departments • • • • • • • • • • • • • To maintain monthly statements etc.S.C. like as – LIC. Increment concerned with employees. Number of Persons Working Under above Section • • • • • In this section number of persons working is ten. Income Tax.There are various sections / departments which are working in the Bank. 1 Senior Manager 2 Manager 2 Assistant Manager 5 Clerks Functions of Loan Department . files. state level /aims. Pass T. Passing the M. bill of employees Salary of employees’ maintained. Fuctions of Account Section • • • • • • • • • The Misc. House Loan To issue charge sheets of employees & maintain it. Maintain the current A/C with P. department reconciled the A/c of all the branches. D. Master policy of holder such as – EDLT. Sanctioned of cash credit limits of societies.L.A. of societies. GSLI Grievance of public & branches. Yearly statements. Maintenance of receipt and dispatch register. Furniture fixture. It helps to maintain sundry A/C.C.

R. like as – Consumer Composite /integrated Vehicle Loan Computer loan –only for staff member • Sanction all types of limits.T. three wheeler. like as – cash credit trader Cash credit farmers Loan against property Rural godown Mini dairy Mai Bhago scheme Renewal of cash credit limits. Physical verification done before sanctions the limits or loans. Vehicle loan – two wheeler.• Sanction all types of loans. & S.O. 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 . • Maintain statements for refinance &send to NABARD.

pay rolls.30p. There is no extra system for recording the time. preparing statement of assets and liabilities etc. All the records of this vehicle were kept in this logbook.• 1 Typist Account and Finance Department Keeping of account and maintaining books of accounts. The recorded of the arrival & departure was recorded through Attendance register company maintenance the attendance registers.m. Medical loan LTC Loan (Loan Traveling Concession) DA (daily allowance) TA (traveling allowance) . Each vehicle has own separate logbook.m. Scooter loan/ motorcycle/ car loan at subsidiary rate. Miscellaneous Activities • Office Time: . When they come after lunch they will entered the arrival time 2. To 5p.m.00p.B. • • • • • • • House Loan facility at subsidiary rate. Entered the time in the Attendance register in the first column and at time of lunch. recording receipts and payments. 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. FACILITIES FOR STAFF The following facility is available to staff members. Festival loan.m. The vehicle was used. has fixed the timing for all the employees the timing of this company is 10a. • Log Book : -All the vehicles of the company having logbook.C. Than duty was complete they will entered the departure time 5. The entire employee entered. preparing profits and loss accounts.The P. are office activities of specialized nature.C. The perform shows that.m. All the employees come at 10a.m. The departure time for lunch at 2p. And also entered the total working hours in the full day. All these are office work and performed by this special office. preparing budgets.

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. Name of Branches Sr.N.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. of Punjab. 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.

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. 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. cost effectives and quality banking services to customers and PACS.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. 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. . 2.

the technology has been successfully deployed in about 40 branches. Federation of Coop. 4. To do all such other things as are incidental or conducive to the promotion or advancement or objects of the Bank. At present. . Plus it will help PSCB to set the fixed standardization of products and services to customers. institutions. Coop. according to Indian fintech vendor I-flex . 8. 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. 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. I-flex subsidiary Flexcel will deploy. To promote and develop Cooperative Societies in the State. Coop. Providing Long Term Loan for the maximum period of 15 years to individuals. powered by Oracle Database and Oracle Real Application Clusters.3. 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 . 6. House Building Societies. 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. funds. 7. House Building Societies and members of Group Housing Societies for purchase of house or construction thereof by enrolling members/nominal members. host and manage the core banking system. The program of deployment was worked out to improve transaction processing and to provide online. and the next 200 locations are awaiting their turn. 5. House Building Societies and members of Group Housing Societies for purchase of house or construction thereof by enrolling member/nominal 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. To adopt such measures as are conducive to the spread of cooperative education and training.

which holds an 81% stake in its business. MD. and develop competitive differentiation because we expect the market to be increasingly demanding." 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. 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. says: "We selected Flexcube. CHAPTER – III RESEARCH METHODOLOGY .PS Sidhu. I-flex explained that the new name signs its "close strategic and operational alignment" with parent company Oracle. Punjab State Co-operative Bank. 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. maintain the customer intimacy we have created over the years. Oracle Database and Oracle Financial Services On Demand to enhance our efficiency by replacing manual processes.

Research methodology Research is composed of two syllables. Search means to examine closely and carefully. Research is an organized and systematic way of finding answers to questions. Research methodology is the specification of method of accruing the information needed to structure or solve at hand. that the significance of research lies in its quality and not in quantity. . those that provide the basic guidelines for the details of the project. to test and try. Redman and Mory defines research as a “Systematized effort to gain new knowledge”. It may be noted. • To know the purpose of granting various types of loans by the bank according to the various categories of customers. To know the structure and various schemes of loans provided by The Central Cooperative Bank Head Office Patiala . It is not concerned to decision of the fact. undertaken to establish facts or principles. • To know the process of granting loans by the bank. anew. Research Design Research design is a pattern or an outline of research project working. over again. The two words form a noun to describe a careful and systematic study in some field of knowledge. Under this project. in the planning and development. a prefix re and a verb search. Research design carried out was exploratory in nature Objective of Study • • To get information about a cooperative bank & its functions etc. but also building up to data knowledge and to discover the new facts involved through the process of dynamic change in the society. 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 is a statement of essentials elements of a study. Re means again. 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. keeping in view of the objectives of the research. to probe.

There are two types sources from where data is collected . Some employees were hesitant in providing complete information. 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. • Secondary Sources The secondary sources of the data were the information about the PATIALA CENTRAL CO-OPERATIVE BANK LTD. These helped in gaining knowledge about the Bank.Collection of Data Collection of data is most significant stage of every research. Limitations of Study • • Lack of personal interest of employees to provide information and adequate time. CHAPTER – IV ANALYSIS OF LOAN PROCEDURE AND LOAN SCHEMES . and the bank’s profile which includes functions of bank and various schemes of granting loans etc.

usually along with interest. In anyone's life a situation may come when all of sudden you require cash. home improvement etc. For each and every kind of need. There are various types of loans like home loans. Students who want to study more but can not afford can get apply for such loans and continue their studies. Many of your desires can be fulfilled by this loan. You can take any type of loan you need. For this business loans are available. Personal loans are available for personal requirements like wedding ceremony. because there is solution for these queries. 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. 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. Loans are available for these purposes only. There may occur any kind of emergency when you need huge amount of money. at some future point(s) in time. 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). business loan etc. purchasing a home etc. Home loans are available for general home purposes like buying a luxurious car. You can get business loans to start and well establish a new business in market. going for a holiday trip. Student loan as it itself suggest is that it is provided basically to students for higher education. Loans are provided to people for such critical circumstances which may occur at any time. loans are available. A person willing to setup a business may not have that much cash which can meet out his requirements. personal loans. and the borrower agrees to return the property or repay the money. A moment when you do not want to borrow cash from your relatives. there is a predetermined time for repaying a loan. Importance of Loans in Today's Life Everyone needs money at every stage of their life. To start a new business you require a huge amount of money.Definition of Loan An arrangement in which a lender gives money or property to a borrower. student loan. Usually. educational purpose. .

but most neglect efficient. At the beginning. A job description would state that the job entails making both domestic and foreign travel arrangements and processing invoices for this. A job description entails. All kind of loans have their own importance. 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. lenders are trying their best to attract people by providing different schemes which in turn is good for people. Henrik Ibsen once said. Less precisely speaking. If you get loan for long term with low rate of interest then it is beneficial for you. "A community is like a ship. If the person in charge of travel arrangements is out of the office. Every job entails a certain sequence of paperwork." Likewise. exact and up-to-date procedures manuals.people should be able to pitch in and get the job done. 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. how to process the invoices by explaining the forms and what department handles them. someone else can open the procedures manual and follow the directions to do the job. routine tasks and contacts. A procedures manual would give the names and phone numbers of various travel agencies used for the firm. Above all. emergency procedures). all have full fledged facilities. Due to competition. someone might be in charge of travel arrangements. This is possible only if they are provided with the proper instructions and materials. Appling for loan is very easy. the manager should meet with each . Apply for that loan whichever is needed to you. decisions. Nearly every company prepares job descriptions. the best people to contact. need of money explains the importance of loan. product or outcome. But before applying you should go through different lender's policies and apply for that lender which is beneficial for you. this word can indicate a sequence of tasks. an office . A procedure usually induces a change. everyone ought to be prepared to take the helm. calculations and processes. Managers should see that every support staff employee in his or her department prepares a procedures manual for each job. 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. that when undertaken in the sequence laid down produces the described result. And cooperative bank is also one of them. For example.Whatever may be the kind of loan. Different lenders have different policies. steps.

how long it will take. Phone numbers. 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. or refuse to. If persons. share information because they feel it will diminish their importance. names or directions need updating.What people are involved in completing the task. 3. no less do it well. 4. chain of command. etc. forms or materials needed (and where they are kept). The outline should cover: 1. 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. addresses and phone numbers as well as a brief description of what each does. Who . If a computer sequence is followed to complete forms or reports for the task. electronic mail. These employees should be helped as much as possible and . Some people will be afraid that their writing skills are inadequate and they will be unable to do their part properly. They do not want someone else to do their job at all. Unfortunately. if disks are used. Employee resistance to the idea of doing a procedures manual is to be expected. Both the employee and manager should have copies that are accessible to others. addresses. • • • • 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.employee individually and discuss the preparation of the manual so that its function is fully understood. One of the problems in every office involves employees who are reluctant to. potential problems and solutions based on experience. what you need from them and what they need from you. Another important part of the manual is making sure that it is up to date. When . departments.). agencies or companies outside your company have to be contacted to complete a job. An outline of what is expected should be prepared and given to each employee to follow.How often it is done. Outdated information will only confuse someone and will not get the job done. the procedures manual should give specific names. copies of each screen used should be made and placed in the procedures manual in the proper order. this type of thinking does much more harm than good.Sequence of steps to complete the job.A description of the task. What . All employees should be instructed to check the procedures manual they have prepared at least once a month to see if phone numbers. How To . a description of how they are operated for this particular job (i. A "dummy" of each page should be filled out so that it can be easily followed. where information is stored.e. If office machines are involved (computers or word processors). 2. how to retrieve the information.

A procedures manual also allows a manager to see what people are doing and estimate how long certain duties take. can make hiring decisions as to whether or not extra staffing is required or whether people can be let go. this and this. A procedures manual is not a panacea for all office management problems. People do get sick. quit or leave for a variety of reasons . but it certainly helps. obviously retraining is necessary or the employee should not be in the job." you have very little idea of what time and effort is involved unless you have done the job yourself (probably unlikely). extra seating. Detailing the steps involved would enable anyone to take care of the job without confusion and problems. Their contributions can be polished later on.• • • • • encouraged to do the best they can. there is a big difference in the amount of time expended. Hiring decisions Managers can. by the step outlined in the manual. 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. "I do this. or have it written down in a procedures manual. This enables the office to run much more smoothly and gives managers a "feel" for what is going on in their departments. . provides writing tablets and pens or takes minutes as part of the job. Obviously. therefore. A procedures manual is a simple office tool that can save a lot of time and avoid a lot of problems. 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. 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. coffee or other beverages and refreshments. knowing that keeping the details vague makes the job sound a lot busier than it really is. depending on what steps are involved. Usually. Another advantage of the procedures manual is that a manager can see whether or not an employee is suited to a certain position. make decisions about consolidating certain jobs when there is an obvious lack of work in some jobs and too much in others. 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.often quite suddenly. difficult manner. A manager should be able to see. dates and times or arranges for audio/video equipment. If you ask an employee what a job entails and she or he says. resistance is greatest among those who know they have more time on their hands than the job entails. whether the job is being done as efficiently as possible. 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. If the employee seems to go about tasks in the most complicated. These people will usually denigrate the whole idea of writing down what they do in detail. 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. A procedures manual would indicate whether the person in charge simply keeps a reservation book noting the names.

employee of govt.Loan Procedure The loan to get passed. mode of loan disbursement. or semi govt. Submission of documents: After getting the information customer submit the required document to bank facility. Inquires Information Procedure for getting a loan I.. He is provided this information by the clerk at the reception. II. III.P. Reception Here a person (customer) inquires about the loan rates and other prerequisites that are to be submitted. firm. cooperative Societies etc. For example: to take a House Loan he submitted various types of documents like: 1. At this step he is get the information about the amount sanction criteria. or any institution approved by the board of directors of the bank. student. perquisite documents etc. Customer Under the above procedure customer means the per who wants to take a loan. companies. individuals . trust. mode of repayment. For example a person want to take a vehicle loan . note) . interest rate. Custer may be a farmer . period of time. Demand Pronote note (D. it has passed through many hands as shown in the following figure.

Details of cost/estimate from approved Architecture/valuer/Engineer of the house to be purchased/constructed/ renovated/addition to made. 1. 7. total value = value of stock + value of land 2. the file is forwarded for inspection. To take a loan borrower firstly required to take nominal member ship of bank. Credit rating: Based on the documents submitted by the customer. 3. 4. the officer verifies the work done by the clerk at the credit rating desk. VI. 10. Latest jamabandi and girdawri. 6. 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). 12. V. Here. VI. i. according to the rules of bank some percentage of the value of these assets can only be given as loan. Now. 5.e. Non encumbrance certificate. the process is started actually. This percentage varies for different types of loans and based on it the sanctioned loan amount is calculated.2. This is done as follows.e. The borrower shall be also required to submit collateral security @100%of loan amount etc. Moreover. then in this case his credit will be calculated as a sum of the value of both these assets. how much the loan amount should be granted to the customer is calculated. First the total value of the customer’s assets is calculated. For example if loan is on a stock plus if he has provided the papers of his business land. 9. the credit rating of the customer is done i. he hands over the file to the loan manager. Certificate of ownership of land/property situated within Red Line of the village from the Sarpanch/Numberdar/Patwari 11. After the satisfaction with all the parameters. 8. Inspection: After having calculated the credit and the amount that can be sanctioned for loan. 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. Only after fulfillment and submission of all documents which are required according to take various types of loans. Loan Manager: . Agreement of sale deed.

to 500000 Rs. 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. This is done by bank with the help of United India (UI) Insurance Company. these are granted by above parties.only Board of Directors: If the loan amount is greater than 500000 Rs. IX. the loan amount or account is handed over to the customer. he has power to reject the loan application.only. The maximum amount is granted up to 100000 Rs. . then loan amount is paid to the customer./. District Manager : District Manager can grant a loan from 200000 Rs. then the insurance is taken on that particular thing also. At this stage loan granting manager recheck all the documents. Moreover. Insurance: Before issuing the loan amount or opening of a/c for loan. So according to different types and different amounts of loans. This file is then cross examined. the file is then put forward before the Chairman and Managing Director (MD) in a meeting././. the file of customer reexamined by the loan manager. 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. If the loan is consumer loan then it is directly granted by branch manager ././-. Loan manager pass the loan if customer fulfill all requirements. 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. Giving away of Loan: After paying the insurance amount.At this step .then it is granted by the board of directors of the Patiala Central Cooperative Bank. But if there is any thing which is unclear or insufficiency in the documents. But he is also liable to give specific reason to the customer about the rejection of loan. If all the members of top management are mutually consent then the application of loan is ready for disbursement of loan amount. VIII. VII. if any other thing is mortgage for taking loan. Before the disbursement of loan amount to customer firstly bank require becoming a nominal member of bank. 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. This is explained in detail in the coming sections.

Several housing schemes for this are in operation. 50% 50% Loan Schemes * Scheme for Financing Rural Housing * Preamble:.) Eligible Borrower: .1) Individuals 2) Cooperative Housing Societies Purpose of Loan: . For purchase of plot – 50% b. Up to roof level – 25% c. the GOI and State Govt. construction. repair/alteration etc. Bank to start housing finance for acquisition. are attaching utmost importance to the financing of housing sector. . where other financing institutions are reluctant to advance. it has been decided by the Coop.With a view to provide housing facilities to the masses which is a basic need of human beings. 2nd installment after completion up to roof level. In case Urban Housing Loan amount of loan is disbursed into three installments: a. This scheme has particularly been designed for rural people. 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. Like in case of Rural Housing Loan amount is paid into two installments:a. construction of a new house or repair/ renovation/addition/alteration of existing house in rural areas. Any customer can easily get a loan to fulfill his/her various requirements and get it fastly as per as possible.In some type of loan schemes the amount of loan is paid into installments.T.Loan shall be advanced under the scheme for purchase of built up house. 1st installment at the time of starting construction up to plinth level. After roof level – 25% So above are the various stages into loan procedure adopted The Patiala Central Cooperative Bank. b. With a view to supplement these schemes.

Penal interest @ 2% over and above the normal rate shall be charged in case of default.5 lacs (for repair/ addition /alteration of House) b. subject to 85% of cost of construction or value of property to be purchased. Maximum loan – Rs. on the default amount for the default period. Rate of Interest: . Loan eligibility shall be calculated on the basis of repayment capacity of the borrower.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. For Renovation/Repair/Addition/Alteration: a. Income of the co-applicant can also be considered for loan eligibility. 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. Period of Loans: .The quantum of loan shall depend upon repaying capacity of the borrowers. it shall start after expiry of 3 months from the date of purchase.Ceiling on the cost: .15.00 lacs. For construction/purchase of new House a.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 repaying capacity shall be determined on the basis of land holding and other known sources of income and commitments/subsistence towards his family.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. A reasonable installment to income ratio i. 0.e. Repayment period – 10 years in monthly/half yearly installments. Value of agriculture land as per norms fixed by the District Collector from time to . Margin Money – 15% Repayment period – Up to 15 years in monthly/half yearly installments. Margin money – 15% c. Interest Is charged as contract made with the loanee. otherwise cost of land should not be included in the project cost Quantum of Bank loan for Individual: . In addition to it collateral security shall be taken @ 100% of the loan amount in the form of agriculture land.15. Maximum loan – Rs.The maximum period of loan shall be upto 15 years and loan shall be repayable in equated monthly/half yearly installments. Security: . Due date shall be 30th June and 31st December every year.5% concession is allowed to women.00 lacs b. In case land is being acquired the cost of land may be reckoned as margin money.

Certificate of ownership of land/property situated within Red Line (i. In case of employees of the Govt. In case of built up house. Sanction and disbursement of Loan: . 2nd installment after completion up to roof level. Note Two latest attested passport size photographs of the borrowers. P. Latest Jamabandi and Girdawari.. 1961. 6. Copy of approved drawing of the proposed dwelling unit to be constructed/purchased from Sarpanch / Numberdar. 5. semi govt. Non-encumbrance certificate.e. Processing Fee & Other Charges: . 7. 12. 50% 50% . mortgage of house to be financed.25% of loan amount shall be charged Documentation & general requirements: . 11. Phirni) of the village from the Sarpanch/Numberdar/Partwari. 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. Application form Loan agreement D. loan can be advanced on primary security i.time should be taken into consideration. 10.Following documents are required for financing under Rural Housing Scheme 1. Corporation... etc. which is as under:c.The loan shall be sanctioned after it is ascertained that the applicant fulfils all the requirements and enjoys reputation as a good pay master.e. along with two good sureties and undertaking under section 39 of Punjab Cooperative Societies Act.Processing Fees and other charges @ 0. 2. however. Agreement of sale deed. the borrower should be in possession of plot with unquestionable and indisputable title. d. 2nd installment shall be disbursed after ensuring proper utilization of previous installment. Details of cost/estimate from approved Architecture/ Valuer/ Engineer of the house to be purchased/ constructed /renovated /addition to be made. Source of Finance for own contribution. 8. constructing house within rural areas. Payment shall. Boards. the payment shall be made @ 75% of total value of the house/Loan sanctioned. 3. Proof of residence. loan shall be disbursed in 2 installments. 4. 1st installment at the time of starting construction up to plinth level.. 9. For construction of house. For construction loan.

alteration. Completion certificate. Agency. iii. purchase of built up house. 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. Post dated Cheques. construction of house or repair. Societies. additions. Rules and Bye Laws. flat. b. Undertaking U/S 39.13. 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 . The applicant and co-applicant. in the existing house. 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.Loan shall be advanced for the purchase of plot. Note: The Borrower should not have defaulted in any other loan.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. 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: . 14. Improvement Trust or any other Govt. . The borrower shall be required to submit collateral security @ 100% of the loan amount. Punjab Chandigarh decides. * Scheme for Urban Housing Loan * Short title Extent and Commencement a. ii. Purpose: . Salary Certificate. House fed.Bank (s) in the State of Punjab. Additional Documents from Employees: i. Loans shall also be given for acquiring a plot. renovation. iv. etc. house in an existing or proposed Cooperative House Building Society and approved scheme of PUDA. if any will be enrolled as nominal members of the bank under the Act.

The remaining.The quantum of loan will depend upon the repayment capacity of applicant to be calculated by the bank as under : 21 yrs.25 lacks or 75% of total cost of construction. purchase of plot + construction thereon under this scheme is Rs.10 lacks. It will be further subject to the repaying capacity of the employee in accordance with their last salary statement. maximum loan amount shall be Rs.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. or Bank Scheme from the Punjab State Coop. exceeding or up to 50% shall be utilized for construction of house thereon”. 0. Penal interest @ 2% over and above the normal rate shall be charged in case of default. For addition/alterations in existing house. To 45 yrs of age. Period of Loan/ Repayment of Loan: . 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. purchase of house (cost of construction + cost of plot.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. Interest Is charged as contract made with the loanee. For repair/renovation maximum amount of loan shall be Rs.Maximum period (including moratorium period) shall be 15 years or attaining the age of 65 years whichever is earlier. Interest: . 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. Quantum of Loan: . .5 lacks. The employees of the Punjab State Cooperative Bank or Central Cooperative Banks who have already availed house loan under Govt.25 lacks under both house loan scheme. Bank or Central Cooperative Banks can also get loan under the scheme subject to maximum of Rs. The loan for purchase of plot will not exceed 50% of the total loan sanctioned.5% concession is allowed to women. if plot is to be purchased). Maximum loan amount for construction of house or purchase of house/flat. Further this loan to employee will be against second charge on the said property. on the default amount for the default period. In case of repair/renovation /addition/alteration loan cases maximum period shall be 10 years.

Fee & Other Charges: . the disbursement shall be in two installments.e. Non-encumbrance certificate. 2. however. for construction on pre-owned plot. be in monthly equated installment to be started from 9 months after the first installment of loan disbursed.Pre-sanction stage: 1. 5. Disbursal of Loan: . Security: . Bank shall not be bound to accept progress construction as assessed by builder.A processing fee @0. 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. 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. Self attested recent passport size photographs of the applicant and co-applicant (two). repayment of loan may be in half yearly installments i. However. . 3. In case of purchase of plot + construction.Security for the loan is a first mortgage of the property to be financed normally by way of deposit of original title deeds. Copy of Income-tax Return for the three years duly acknowledged by ITO concerned. additions. Documentation . 6. The second and subsequent installment of loan shall be disbursed only after ensuring the utilization of previous installment to Bank’s satisfaction. Identify proof.The loan shall be disbursed after the property is technically appraised. alterations and renovation shall be disbursed in two equal installments.25% of the loan amount sanctioned will be charged. In case of the farmers availing loan under this scheme.Repayment of the loan shall. Residential Proof. 4. 30th June and 31st December every year. Sources of Finance for own contribution.

a. Construction Plan approved by a competent authority. 10. Disputes If at any stage any dispute arises. it will be settled/referred under the Punjab Cooperative Societies Act 1961. Detailed Cost estimate from Registered Architect/ Civil Engineer. riots earthquake lighting floods etc. 8. Loan application Form Post – Sanction Stage 1. Insurance: .Undertaking from the employee under section 39 of Punjab Cooperative Societies Act.7. Mortgage Deed Letter of Lien and Set Off Letter of Waiver Letter of Guarantee Employed applicants: . 1961. 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. Demand Promissory Note. * Personal Loan * . 3. 4.Comprehensive insurance in the joint names of the borrower and the bank shall be made of the property mortgaged against fire. A photocopy of registered title deeds or allotment letter (in case of member of Cooperative House Building Societies In purchase ofBuilt Up House cases. b. Agreement of sale/sale deed/detailed cost estimate from approved engineer. 2. Loan agreement. c. 5. Search report & legal opinion along with photograph of the property. photocopy of allotment letter and details of balance payment. 9. b. Income Proof/J-Form. In case of allotment of flat/houses. 11. Original title deed. Purchase agreement of property. Spot Physical verification. if any. 12. 6.

a.salaried employees of Punjab government. General Insurance Companies. * 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 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. Age: . The 1st installment will start after one month. which has defaulted in repayment of loan under any other scheme. Loan Amount: . Co-operative organizations in the state of Punjab or any other organizations as approved by the Board of Directors of the respective Bank etc.only . Repayment of Loan: . Public Sector Banks. Period of Loan: . Option to repay loan: . No penalty will be charged. Income: .m.14% p. The Loan will be repaid before retirement.in case of others. renovation of residential accommodation.000/. Aided Schools/Colleges. Corporations.Borrower can make the part pre-payment of loan.5 years. in case of salaried persons and Annual Income of not be less than Rs.60.000/.p. Rate of Interest: . PSUs. Boards.000/. 2. traveling. Universities. Loan may be repaid in 36/48/60 Equated Monthly Installments (EMI).00.The Bank offers Personal Loan for various purposes such as meeting medical expenses. Eligibility : . .No collateral security is required.1 year after the confirmation/regularization. Security : . whichever is less. only two guarantor know to the bank. marriage etc.Net income of the person should not be less than Rs.No employee will be given this loan facility.5.12 Times of gross monthly salary or Rs. Premier Medical Institutions.Minimum 21 years and Maximum 57 years. General: .Maximum.Loan is repayable in equated monthly installments in the form of post-dated cheques. Service Tenure: .

Purchase of second hand articles should not be financed in any case. From Rs.10000/amount = Rs.50000/.40000/Total net emoluments from Rs.to Rs. then his salary or loan amount due will be credited to his loan account till the bank directs to do so.Loan amount = Rs.15001/amount = Rs. 6.to Rs.50000/. The borrower himself should be responsible for the repayment of his loan.40000/Amount Loan Rs.to Rs. The loan should be advanced for acquiring new assets only. The borrower should be enrolled as a nominal member of the Bank.15000/Rs. The Borrower should be required to produce 2 sureties who should also be nominal members of the Bank. The bank should obtain salary certificate from the borrower.7501/.Loan . The loan should be repayable in monthly installments but the total duration of loan should not exceed three years in any case.27001/.to Rs.15000/.5001/.00 lac per borrower or 75% of the cost of article to be purchased whichever is less.27000/b.Loan Total net emoluments from Rs.10001/. The bank shall inform the employer immediately after the sanction of .2.100000/.25000/Total net emoluments from Rs.to Rs. From Rs.25000/Rs.1.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.Loan In case of NON-SALARY EARNERS.30000/- c.Loan . the amount of loan should not exceed Rs.40001/Rs.18000/a.7500/Amount = Rs.75000/Total net emoluments above Rs.5000/Amount = Rs.18001/. 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. 3..50000/5. the amount of loan should not exceed Rs. More than Rs. 4. in accordance with the slabs fixed hereunder:Total net emoluments upto Rs. In case of SALARY EARNERS.

g. 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. * 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. 10. Post dated cheques equal to number of installments should be obtained from the borrower. Penal interest @ 2% over and above the normal rate shall be charged in case of default. 1961 for repayment of loan in case the borrower fails o repay the loan. the bank will ask the employer of the borrower to deposit the due amount by deducting from the salary of the employee. Interest is charged as contract made with the loanee. Demand Promissory Note An authority letter from the borrower under Section 39 of Punjab Cooperative Societies Act. The loan should be advanced against hypothecation of the asset/assets acquired/to be acquired. 11. Salary certificate/proof of income Loan agreement.loan. 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. Information Technology and professional courses. 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. if any. medical colleges. e. In case of default by the borrower. on the default amount for the default period. 7. technical institutions. f. The bank should also obtain the following documents from the borrower :a. b. Management etc. Letter of waiver. d. An authority letter from the borrower to recovery the installment/interest by debiting to saving/current account. pharmaceutical colleges. 9. 8.5%concession is allowed to women. 0. so that students from poor & middle classes as well as brilliant . 12. c.

Eligibility: Age of student. Duration Of Course: . XIII. Refundable deposits. Age of Father. IX. XI. Monthly/quarterly tuition fee. Purpose of Loan I. IV. Amount of loan: For Studies in India For Studies Abroad Rs. .The age of Father/Guardian should not be more than 65 years till full recovery of loan amount. VIII.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. [The scheme will not cover any correspondence course].00 lacs Rate of interest: . VII. VI. 5. Library charges. Admission to Course: . if any. Education Qualification. Admission Fee Purchase of books and stationary Purchase of instrument required for course undertaken by applicant.The course should not be more than 5 years.The applicant must secured admission or has got the consent of the institution to admit to any one of the above-mentioned courses.25% per annum. V. Laboratory charges if any.The rate of interest on Cooperative Education Loan Facility(CEL) shall be 7. This rate is however subject to change from time to time. II. XII. Expenses on projects if any. Caution deposit/Building Fund. III. 10. X.00 lacs Rs. Air fare for joining the course (for study abroad) Examination Fee.and needy students can take advantages of the scheme. Boarding and Lodging expenses Computer purchase if required.

3. 8. Disbursement of Loan: .Processing Charges: .will be advanced against collateral security by the applicant/guardian. Students going abroad for study will have to submit the necessary documents such as copy of Passport. Admission Letter. Bank must be informed and loan amount must be paid immediately. If study is discontinued for whatsoever reason. Term Fees. All other documents and information to be provided as per checklist provided with the Application Form. Recovery of Loan: . Mark Sheet / Certificate for passing last Board / University examination. Hypothecation of stocks and book debts. The disbursement of loan should be by Demand Draft/bank cheque in favour of concerned university /college. 9. The loan above Rs. copy of Admission Letter. which ever is earlier.No collateral security is required up to a loan of 25000/-. 5.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. Visa. copy of Form I-20 (for U. 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. This loan shall be advanced against two good sureties. Subsequently the loan amount for the next year will be disbursed after successful completion of previous year. Security: . 2. Cost of Books. etc. Basic Requirements: 1. Traveling. 6. The collateral security can be in the form of land/building NSC/KVP/LIC Policy/bank deposits in the name of student/parents/guardian. In the first year disbursement will be equivalent to the expenses of first yearly only.25000/. .S). 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. Applicant should produce year-wise estimated total expenditure which is to be incurred such as Tuition Fees. Insurance of student: . In case of purchase of equipment/books/computer the payment shall be made to the applicant. 4. 7.The branch will get sanction of whole loan amount from competent authority but will disburse the amount based on yearly expenses of course. The valuation of the collateral security shall be equivalent to the loan amount.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.No processing charges shall be charged under CEL. Living Expenses. Progress Report of the studies of the student from time to time. etc. Examination Fees.

* Vehicle Loan * 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. Penal interest @ 2% over and above the normal rate shall be charged in case of default. HUF. 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.5 Rule No.10.10 Rule No. Rule No. failing which additional interest at the rate of 3% shall be charged. One month moratorium period shall be allowed under the scheme.1 These rules are called the rules for granting of Vehicle Loan to individuals. 0. The Bank reserves the right to proceed against the borrower and sureties in the event of default in the repayment of loan installment/s. 9 Rule No. Trust and Cooperative Societies.7 Rule No.11 Rule No.3 Rule No. firms. The borrower should agree to produce the vehicle for periodical inspection to ensure that it is maintained in satisfactory condition. Companies. 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. Interest is charged as contract made with the loanee.00 lac or 80% of value of the vehicle whichever is less. 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. on the default amount for the default period. The application for loans should be made in the form prescribed by the Bank.6 Rule No.12 Purpose of loan is to provide financial assistance to purchase new vehicles for business and personal use.2 Rule No.4 Rule No. The loan documents should be executed by both the student and the Parent / Guardian as C o-applicant. The repayment of loan should be in the form of monthly installments to be repaid within 5 years. However farmers may opt for half-yearly installments due on 30th June and 31st December. 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. 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. The maximum amount that can be sanctioned under the scheme is limited to Rs.8 Rule No.10. In case loan is above 60% of the cost of vehicle (subject to 80% of the cost as stipulated in the rules).

c. It shall come into force from the date of approval by the Registrar Coop. sole proprietor. should be accident free. etc. 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. 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.The quantum of loan shall depend upon the model and present value of the vehicle. Chandigarh or the State of Punjab. Societies Punjab Chandigarh. sumo. The scheme shall be implemented through the branches of the State and Central Coop. 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. * 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. d.Rule No. Eligibility: .Loan shall be advanced for the purchase of second hand vehicle such as car. The vehicle to be purchased by the loanee should not be more than 3 years old. Purpose: . Banks in UT and in the State of Punjab. Quantum of Loan : . for personal/public use. b. qualis. bearing Registration Number of U. Rules and Bye-laws. this scheme has been diversified.T. one time road tax paid. jeep. 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 applicant will be enrolled as nominal member of the bank under the Act. Short title.13 Rule No. extent and commencement:a.14 The borrower should agree to be bound by arbitration provisions in the Punjab Cooperative Societies Act 1961 and the Rules framed there under. Present value shall be the value as provided by Sah & Sanghi in the current price Index and also available on Website htpp.wwwautomartindia.com/Sah & Sanghi price index. which is lowest shall be the .An individual.

be in monthly equated installment. 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. Residential proof 3. Two self attested recent passport size photographs of the applicant and sureties each.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. 4. KVPs. on the default amount for the default period. 0. Copy of Income Tax Return for last three years duly acknowledged by ITO 6. 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. Repayment of the loan shall. Identity proof 2.5 lacs or 75% of the assessed price of the vehicle whichever is less.5% concession is allowed to women Period of Loan/Repayment of Loan: . A photocopy of the RC of the Vehicle and case of rural people copy of Fard. Moratorium period of one month shall be allowed under the scheme. The maximum loan amount shall be Rs.A processing fee of 0. in case the borrower is not willing to give sureties. In case of urban borrowers and half yearly equated in case of rural borrowers due on 30th June and 31st December. Jamabandi. OR A collateral security to the extent of 100% of loan in the shape of assignment of life insurance policy.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. Interest is charged as contract made with the loanee. Term Deposits of own bank. Security: . .25% of the loan amount sanctioned shall be charged. Penal interest @ 2% over and above the normal rate shall be charged in case of default. Photocopy of the PAN 5. pledge of NSCs.The security for the loan is 1st Hypothecation of the Vehicle in the name of the bank entered in RC of the vehicle. Fee and Other Charges : . Photocopy of the Driving License 7. The sureties shall be enrolled as nominal member of the bank under the Act. Documentation : 1.quantum of loan. Disbursal of Loan: .Maximum period of loan shall be five years. Interest: .

12.This scheme may be called Scheme of LOAN AGAINST PROPERTY(LAP). Loan can also be given for both purposes i. Hypothecation deed/Collateral Security/Agreement Bond from Sureties. U. Chandigarh decides.Comprehensive insurance in the joint names of the borrower and the bank shall be made at the cost of the borrower. on the Subject. The loan will. and is designed to offer instant solutions relating to socio-economic needs such as children’s higher education. An individual residing in and having a self occupied immovable property in the area mentioned in the Purpose Clause no. Coop. The age of borrower should not exceed 65 years at the time of applying for the loan. Dispute: .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. partly for term loan and partly . Type and Quantum of Loan: .The scheme is for providing finance against mortgage of immovable property situated at Chandigarh.T. etc. however be not avail for speculative purpose. medical emergencies. Agreement of Sale. Beneficiaries should be enrolled as Nominal Member of the bank. if any.The loan can be given in the shape of Term Loan or Credit Limit. Certificate of present value of car assessed by Surveyor of company guide or as determined on the basis of guidelines of the Punjab Govt.e. Purpose: . Rules and Bye-laws. In case of default bank will be at liberty to get a policy renewed by debiting to loan account of the borrower. DP Note 11.If at any stage any dispute raised. Societies Act. extent and commencement: . 1961 and rules frames there under and bye-laws of the bank * Scheme of granting Loan against Property * Short title. Periphery by Punjab State Cooperative bank and at urban areas (within Municipal Limit) by Central Cooperative bank through its urban branches. will be enrolled as nominal members of the bank under the Act. b.8. Eligibility: a. Loan application form 9. 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. 13. daughter’s marriage. The applicant and co-applicant. 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. Punjab. it shall be settled/referred for arbitration under the provisions of Punjab Coop. Loan agreement 10. travel. Societies. It shall come into force from the date as the Registrar. Insurance: .

Letter of continuity 10. In case the income of family member is taken while calculating loan eligibility. b. Overdraft facility is to be renewed/reviewed annually. over. compounded quarterly or as may be revised by the bank from time to time. Post dated cheques for the months for which repayment of term loan option is due. 4.a. by way of deposit of title deeds.25% will be levied every year on the credit limit. II. 8. Map and Current Valuation Report of the property from Govt.0. However maximum loan amount will be Rs. 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. 2. III. In case of defaults a penal interest @18% p.5% of the sanctioned amount shall be charged. In case of limit of 0. 3. 7.25 lacs. D.for credit limit subject to quantum of loan for both the loan and limit will not exceed from Rs. . Note. 6. Mortgage Deed. Income of family member can be considered for the purpose of eligibility of loan. Security: I. The guarantor should have its net worth equal to or more than the loan amount to advanced.a. Loan Agreement. Loan together with interest is repayable in maximum 72 equal monthly installments. 9. Security for the loan is a first mortgage of the property. Letter of lien and set off. Interest: . Processing Fees: . against which loan/limit is granted. Suitable one guarantee acceptable to the bank. The valuation of the property will be based on the basis of last reserve price of the auction fixed by the Chandigarh Administration. Loan application Form. Documentation: 1. Approved Architect. Original Title Deed. Quantum of loan will be three times of net annual income or 50% of value of property. Search report and legal opinion along with the photo.Interest shall be charged @ 15% p.00 lacs. For the properties situated out side the Chandigarh.25. 5. he/she must be taken as guarantor. Repayment of Loan: a. whichever is less.P. Non-Encumbrance Certificate.

T. housing agencies. 4. Latest 3 months Salary Slip with all deductions & Form 16 for last 2 years. Latest Bank Statement/Passbook (where salary/Income is credited for past 6 months). 4. etc. 5. urban Development Authorities like PUDA. 6. floods. 3.Comprehensive Insurance in the joint names of the borrower and the bank shall be made of the property mortgaged against fire. lightning. Copies of all Property Documents. Documents required from the non-salaried individuals 1. cooperative Housing Building societies. it will be settled/referred under the Punjab Cooperative Societies Act 1961 or any other relevant act at the sole discretion of the Bank. 3. House fed and Improvement Trust. Proof of Residence – Any one of Ration Card/Telephone Bill/Electricity Bill/Voters Card. Proof of Residence – Any one of Ration Card/Telephone Bill/Electricity Bill/Voters Card. HUDA and Housing Boars. In case of default bank will be at liberty to get a policy renewed by debit to loan account of the borrower. * Loan scheme for Earnest Money * In order to meet requirements of the public of Punjab and U. earthquake. Copy of Income Tax Returns for last two years. 7. riots. Purpose: .If at any stage any dispute arises. Copies of all Property Documents.Insurance: . Chandigarh.To meet the financial requirements towards Earnest Money deposit to book residential plots/ built up house/ flats being sold by Govt. Self attested recent passport size photographs of the applicant and co-applicant (two). Latest Bank Statement/Passbook (where salary/Income is credited for past 6 months). Disputes: . 6. Proof of Identity – Any one of Voters Card/Drivers License/Employer Card/PAN Card. Documents required from applicants: Documents required from Salaried Individuals 1. 2. Proof of Identity – Any one of Voters Card/Drivers License/Employer Card/Passport/PAN Card. Income proof. the Cooperative Banks of launches one more. Copy of Income-tax Returns for last two years. . 5. 2.

Loan agreement. Agreement with Housing Agencies : .As fixed by bank from time to time. Proof of residence in the form of copy of Passport.No margin required. Repayment of Loan • • • • In case of unsuccessful candidates – on receipt of refund from the housing board/Urban development authority etc. Driving License Voter’s ID Card etc. earnest money can be adjusted from the same. Two Post Dated Cheques in favour of the bank. In case applicant avails housing loan from the bank. In case of successful applicants – lump sum repayment.Individuals of 21 years of age and above.As fixed by PSCB/ concerned DCCB. bak will charge interest as fixed by it. . In case of delay in allotment. No prepayment penalty will be levied.The loan would be disbursed by the issuance of draft/banker’s cheque favoring the concerned agency. 2. Maximum Loan : . In case of delay of allotment as per scheme. Documents 1.No security required. Margin: . Security : .Beneficiaries: . 5. borrower shall repay amount in lump sum on demand. Interest rate : . refund of money beyond stipulated period . 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. Disbursement: . Two latest Photographs. Bank may extent the period at its discretion by getting the amount of interest in advance. 6.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. Processing Fee :. repayment. 4. 3. otherwise bank will charge penalty. Signature Proof. Interest will be charged initially for a period as stipulated by the concerned DCCB and will be non refundable.As per scheme of the 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

. the business transaction of the unit should be deposited in the Cash Credit Account. on the default amount for the default period.5% concession is allowed to women The borrower shall maintain the books of account as prescribed by the bank.16 Failure to furnish stock statements will attract penal interest @ 2% p.1 lac – Monthly Rule No. The legal expenses. registration charges and other incidental charges incurred in connection with the financing shall be borne by the borrower. 0.and hypothecation of stock/assets with the Bank. Amount of limit upto Rs. Rule No. Institutions and to encase the same.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. Aggregate credits during the year in the limit account should be two times of the sanctioned limit or highest availed limit. fee. Penal interest @ 2% over and above the normal rate shall be charged in case of default.15 Rule No.1 lac – Quarterly Above Rs.13 Rule No.a.14 Rule No. The Cash Credit Limit sanctioned should be kept current by regular drawls and repayments.9 Rule No. on upstanding amount for period of nonsubmission of statements. 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. In other words. The Cash Credit Limit shall be sanctioned for a period of one year. 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. Interest is charged as contract made with the loanee. sales and closing stock.12 Rule No. The Bank shall be at liberty to call for additional/collateral security/securities at any time.11 Rule No. Borrower shall furnish stock statement as per following periodicity indicating the opening stock. purchases. 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.

The Borrower shall execute all the loan documents prescribed by the bank.19 Rule No. Deleted.23 Rule No.Rule No.C. The various types of agriculture loans are as under: - A) Short term agriculture loan Purpose: . Eligibility: . 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.17 Rule No. The borrower shall agree to be bound by the provisions regarding arbitration in the cooperative Societies Act and Cooperative Societies Rules.20 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.25% shall be levied every year.Small/Marginal (SF/MF) and others are included. . All categories of farmers . These charges of 0.Agriculturists. limit. 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. The borrower shall be liable to make good of the expenses and legal charges that has been incurred by the Bank in this regard. The borrower should be member of co-operative societies Loan Amount: .24 * Various Agriculture Loan Schemes * Agriculture loan provided in various forms for various agriculture purposes. Tenant farmers and Share Croppers who actually cultivate the lands are eligible for these loans.21 Rule No. Processing fee @ 0.22 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. The Borrower should become the nominal member of the bank by paying necessary membership fee as fixed by the Bank.18 Rule No. Rule No.Financial assistance to meet cultivation expenses for various crops.

helps in arranging inputs in time and facilitates access to the markets. Loan Amount: . Sources of other borrowings e. Land records to ascertain cultivation rights. Bank has drawn a special scheme for financing of Two Wheelers to farmers. The borrower should be member of co-operative societies. In case the sanctioned loan/limit exceeds Rs.25. 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: .g.75 % of the cost of product (Scale of Finance) is given as loan. Acreage under different crop.As per the cultivation requirements of the crop the loan amount is disbursed in cash and kind (for fertilizer. The borrower's repayment capacity is to be considered on the basis of crop grown. 000 security of agricultural land also to be taken.After 6 months. 2. 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). Co-operative Societies and Banks. pesticides etc) B) Medium Term Agriculture Loan Purpose: . 3. saves their valuable time on travel.Borrower should be an agriculturist and own agricultural land either in his own name or in the name of his family members.He has his own land. .The repayment period should not exceed 5 years. reduces the cost of traveling. Disbursement of the loan: . Nature of Loan: . Repayment of Loan: . The value of security including the value of vehicle should be at least double the value of loan.Hypothecation of vehicle to be purchased with bank loan. income from other sources and income of spouse Security: . C) Two Wheeler Loan for Farmers Financing of Two Wheelers to farmers is considered as direct finance to agriculture. The acquisition of Two Wheelers by farmers increases their mobility. The borrower should be member of co-operative societies Repayment: .Cash Credit and Drafts.

00 Lakh Repayment of Loan: 12/18 months.To provide fertilizer to Farmers for production of crops. Eligibility: . 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. To be synchronized with harvesting of crop F) Tractor loan In order to mechanize farming and improve the output of the farmers. Nature of Loan: Cash Credit Extent Of Loan: Need based Maximum Rs.3. 000/- D) Cash Credit Fertilizers Purpose: .Limit: .The loan shall be repayable in 3 years depending upon the activity. Terms & Conditions: . 000/.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). Extent of Loan: . Eligibility: Farmers growing and supplying Sugar Cane . The borrower should be member of co-operative societies.Cost of two wheeler to be purchased should not exceed Rs.per hector only Repayment of Loan: .24.50.Cash credit and Cheque.: . Nature of Loan: .Need based Maximum Rs. the Bank has been giving loans for the Purchase of Tractors.

the beneficiary availing loan should own or purchase a minimum of 3 Agricultural Implements (including Trailor) to be used with the Tractor. Presently. 84 blocks are Dark. For the purpose of exploitation of underground water. but should be White or Grey for installation of new tube well. the State has been divided into 138 blocks which are further earmarked as White. 16 blocks are Grey where there is some more scope for installation of new tubewells. as third party payment.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. The repayment period for Tractor Loan is 9 years. Terms & Conditions • • Area should not be Dark. Every 3rd Tubewell running in the field in the State is installed with the Credit help of this Bank. where there is greater scope for installing new tubewells. • • • . The payment of the tractor is given to the Supplier Firm. Diesel Engine / Electric Motor should be ISI marked. G) Tube well Loan To bring the Barani unirrigated agricultural lands under irrigation. In the purchase of the first Tractor the loanee has to spend 15% of the total cost of the Tractor (including shares . Insurance of Tube well is necessary. The tractor should be registered by the Transport Authority.• • • • • • • 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. The Bank is a major financier in the installation of tubewells in the Punjab State. 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. where tubewells to the full capacity have since been installed. with Grace period of 1 year. The insurance of the tractor is must. Grey and Dark. Loan is given only for those Tractors which are Budhni tested and are ISI approved. Repayment period is 9 years. the bank has been giving loans for installation of shallow Tubewells to the farmers in the State. For the Purchase of the Tractor.

. Punjab.000 10. Chandigarh or from Punjab Government. The loan is to be returned within 9 yearly equal installments which includes 1 Grace year. 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.The Bank raises its resources with the collection of share capital strengthening on its owned funds by taking deposits and borrowings from the NABARD.250 13. The loanee is advanced 85% of the total loan. Applications should be accompanied by the lay-out plan and estimate cost approved by the Soil Conservation Department.) 14. Only ISI marked pipes and other material should be used Resources: .000 Terms & Conditions: • • • Loan Applications under the above scheme be recommended by the Soil Conservation Department.400 9.500 11. * Dairy Development Loan * . The loanee should have the proper irrigational facilities with him.H) Soil cultivation and water management Under this scheme. Punjab State Co-operative Bank Ltd.

The bank shall charge interest @ 10. loans are provided to Individual/Milk Unions for the establishment of two.The applicant contributes minimum 15% of the total cost of animal as margin money. Amount of Finance: . Minimum Economic Size: . 35000/. Repayment of Loan: .The loan shall be repay\able in 5 years in equal monthly installments along with interest. He should be the nominal member of the Central Cooperative bank.The Central Cooperative Bank through its branches shall extend loan facility for the purchase of one cow. IV. V. However margin for scheduled caste. . VI. III. five and ten milch animals units as under: Objectives: a. To increase the income and supply of milk to Cooperative Milk Producers societies. He should have sufficient experience/knowledge in dairy farming.or the animal whichever is less. The bank also has a greater role in the success of Dairy Farming in Punjab. II. Rate of Interest: . three.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. The bank's schemes have proved very beneficial for the rural areas of Punjab. To increase the income of members of Cooperative Milk Societies helping them to purchase higher yielding cattle.Dairy business has been very successful in Punjab.The bank shall provide loan for one cow with ceiling of rs. He should be the supplier of milk to the society during at least past one year. Eligibility Criteria: I. The applicant should be a member of cooperative milk producer’s society. b. Under the Dairy Development Scheme. He should be the cultivating green fodder or should have definite arrangements for its supply. Backward Class and Economically backward members shall be 10%. Margin Money: . He should have cattle shed arrangements enough to house the existing animals and also proposed to be purchased.

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.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. c. d. 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”). 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. Application Form: . Procedure to be followed: .The branch Manager of the central Coop. He shall apprise project as per Performa annexed as Annexure “B”.Securities/documents: . Time pronote b. . 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.The members shall furnish the following security/document to the Central Cooperative bank. After the execution of documents the manager shall get margin money deposits from the applicant in his saving bank account. Bank shall visit the farm to appraisal the technical feasibility and economic viability of the proposal. Appraisal : . After the appraisal of the loan case the branch manger will sanction the loan and get the necessary documents executed from the borrower. 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. He shall sign and get signed tripartite agreement between the borrower the Cooperative Milk Producer’s society and the 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. Hypothecation of milk animal to financed by the bank.

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. The service of loan granting is very fast under P. A loan can be passed into 3 or 4 days. PCCB is aided by NABARD and Punjab Govt. Breadth.C. B.C. Still the bank is old one. The procedure getting a loan is very simple and understood able under P. 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 .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.B. Increasing size. Conclusion The repaid changes in the banking sector are creating opportunities and challenges. bear 50% share of the bank Most of the branches of PCCB are still non-computerized and employees are doing their work manually. complexity and geographic scope of banking have increased challenges of managing.C. regulating and supervising banks.C. The main purpose of PCCB is to serving the people in both rural and urban area. Under PCCB most of the staff is old aged and there is a lack skills of new blood. Also it has become quite difficult for a bank to a gain a unique market share.

CHAPTER – VI RECOMMENDATIONS Recommendations 1. and thus avoid inconvenience. 3. If the interest rate has been reduced or has become disfavourable to the customer.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. 2. The bank should act as per the standing instructions of the customers. Need some more hard work and management should pay more attention. . the bank should inform him. But to meet the competition of market in proper manner Patiala Central Cooperative Bank Ltd.

14. The loan documents should be filled in the presence of the customer. So to meet competition in the market PCCB should also provide the ATM facility. so that the customer gets one window service. In today’s world most of the banks provides ATM facility . 9. 12. 13. PCCB should open new branches in the Rural and Urban Areas to achieve the targets. 6. . 11 Single men Branches are functioning so. All the counter staff should be thoroughly trained with all the schemes/rules and regulations of the bank. The bank should keep the information of the Account’s of the customer confidential.4. Staff should be recruited for smooth working. 5. Rate of interest should be reviewed periodically. Branches should be computerized. Since 1980 no recruitment made in this Bank. 11. The sanction of rejection of the loan applied by the customer should be conveyed in writing. 7. there is a great operation risk in the Bank and management should pay attention about it. 8. 10. There should be complaint boxes installed in the bank that are opened weekly and proper redressal of complaints is done.

com/what-are-co-operative-banks/ 8. http://www. http://pbcooperatives.htm 9. http://www.html 16.pdf http://finance.capitalmarket.in/html/pscb_history1.nios.html 11.asp? SFSNO=356&SFESNO=19 6.gov.org/wiki/Banking_in_India http://www.ac. http://www.com/loans-articles/importance-of-loans-in-todays-life184411.com/investment_in_india/banking_in_india. 2. 5.in/Secbuscour/15. 2. 3. http://digilib.com/doc/17319280/CoOperative-Bank-Mgt 12.articlesbase.html http://www.x=0&submit.wikipedia.moneyguideindia.BIBLIOGRAPHY Bibliography I) Documents and Circulars 1.y=0&qual=high&fname=/jiunkpe/s1/hotl/2008/jiun kpe-ns-s1-2008-33403003-9666-food_lucky-chapter4. Previous years’ Reports are analyzed.petra.com/management/125039-1.wikipedia.banknetindia. http://www. http://www.org/wiki/Procedure_(term) . http://www.scribd.com/2858/loan. Documents and Circular II) List of Websites 1.indiamart.com/banking/ucb.com/CMEdit/SFArtDis.pdf 15.punjabcooperation. http://www.com/news/punjab_state_co_operative_bank_enhan ce_its_efficiency_by_means_of_flexcube 10.allbusiness.html 13. http://www.ac. http://en.htm 7.in/PSCB. http://www.gov.html http://en.php? page=1&submit.id/viewer.banknetindia.html 14. 4.investorwords.ecommercejournal.com/banking/bfunc.

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