EXECUTIVE SUMMARY

Banking, in one form or another was in existence even in ancient

times. Authorities on banking are divided in their opinion regarding
the origin of term bank. The English word bank is derived from the
Italian word Bancho, the Latin word “Bancus” and the French word
“Banque”, which means bank.
As an essential and obligatory part of my course I have undergone 6
weeks, complete summer training at CO-OPERATIVE BANK. This
training helped me in getting practical knowledge in the bakning
environment.
In this project I have tried to provide maximum information about the
LOAN SCHEMES which are provided by the CO-OPERATIVE
BANK.
In this Project Report I have provided all the information which not
only serves the comprehensive knowledge base but also helps the
reader in understanding the fundamentals related to the subject.
In first chapter, the information about bank profile is provided. In
second chapter, review of literature related to loan schemes has been
given. In third chapter,objectives are given and in chapter, research
methodology has been considered. In fifth chapter, main text is given
about the loan schemes.And, in sixth chapter, analysis, findings are
given, and at last some suggestions are given.

1
HISTORY

The Punjab State Cooperative Bank was established on 31st August, 1949 at
Shimla vide registration No. 720 has a principle financing institutionof
the cooperative movement in Punjab. In 1951 its Head Office was shifted
to Jalandhar from where it moved in 1963 to its present building at
Chandigarh. In the cooperative Banking structure, the position of the
Punjab State Cooperative Bank is extremely important as the whole
credit system revolves around it. It has 18 branches and 3 extension
counter in Chandigarh. There are 19 District Central Cooperative
Banks having 813 branches all over Punjab, mostly in rural areas of the
State. One new Central Cooperative Bank and 110 new bank branches
have been opened during the last four years, 1997-2001.

The term Urban Co-operative Banks (UCBs), though not formally defined, refers
to primary cooperative banks located in urban and semi-urban areas. These banks,
till 1996, were allowed to lend money only for non-agricultural purposes. This
distinction does not hold today. These banks were traditionally centred around
communities, localities work place groups. They essentially lent to small
borrowers and businesses. Today, their scope of operations has widened
considerably.

The origins of the urban cooperative banking movement in India can be traced to
the close of nineteenth century when, inspired by the success of the experiments
related to the cooperative movement in Britain and the cooperative credit
movement in Germany such societies were set up in India. Cooperative societies
are based on the principles of cooperation, - mutual help, democratic decision
making and open membership. Cooperatives represented a new and alternative

2
approach to organisaton as against proprietary firms, partnership firms and joint
stock companies which represent the dominant form of commercial organization

The Beginnings

The first known mutual aid society in India was probably the ‘Anyonya Sahakari
Mandali’ organised in the erstwhile princely State of Baroda in 1889 under the
guidance of Vithal Laxman also known as Bhausaheb Kavthekar. Urban co-
operative credit societies, in their formative phase came to be organised on a
community basis to meet the consumption oriented credit needs of their members.
Salary earners’ societies inculcating habits of thrift and self help played a
significant role in popularising the movement, especially amongst the middle class
as well as organized labour. From its origins then to today, the thrust of UCBs,
historically, has been to mobilise savings from the middle and low income urban
groups and purvey credit to their members - many of which belonged to weaker
sections.

The enactment of Cooperative Credit Societies Act, 1904, however, gave the real
impetus to the movement. The first urban cooperative credit society was
registered in Canjeevaram (Kanjivaram) in the erstwhile Madras province in
October, 1904. The Cooperative Credit Societies Act, 1904 was amended in 1912,
with a view to broad basing it to enable organisation of non-credit societies. The
Maclagan Committee of 1915 was appointed to review their performance and
suggest measures for strengthening them.

Under State Purview

3
The constitutional reforms which led to the passing of the Government of India
Act in 1919 transferred the subject of “Cooperation” from Government of India to
the Provincial Governments. The Government of Bombay passed the first State
Cooperative Societies Act in 1925 “which not only gave the movement its size
and shape but was a pace setter of cooperative activities and stressed the basic
concept of thrift, self help and mutual aid.” Other States followed. This marked

the beginning of the second phase in the history of Cooperative Credit Institutions.

The first study of Urban Co-operative Banks was taken up by RBI in the year
1958-59. The Report published in 1961 acknowledged the widespread and
financially sound framework of urban co-operative banks; emphasized the need to
establish primary urban cooperative banks in new centers and suggested that State
Governments lend active support to their development

Recent Developments

Over the years, primary (urban) cooperative banks have registered a significant
growth in number, size and volume of business handled. As on 31st March, 2003
there were 2,104 UCBs of which 56 were scheduled banks. About 79 percent of
these are located in five states, - Andhra Pradesh, Gujarat, Karnataka, Maharashtra
and Tamil Nadu. Recently the problems faced by a few large UCBs have
highlighted some of the difficulties these banks face and policy endeavours are
geared to consolidating and strengthening this sector and improving governance.

4
INTRODUCTION OF COOPERATIVE BANK

The Co operative banks in India started functioning almost 100 years ago. The
Cooperative bank is an important constituent of the Indian Financial System,
judging by the role assigned to co operative, the expectations the co operative is
supposed to fulfil, their number, and the number of offices the cooperative bank
operate. Though the co operative movement originated in the West, but the
importance of such banks have assumed in India is rarely paralleled anywhere else
in the world. The cooperative banks in India plays an important role even today in
rural financing

The businessess of cooperative bank in the urban areas also has increased
phenomenally in recent years due to the sharp increase in the number of primary
co-operative banks.

Co operative Banks in India are registered under the Co-operative Societies Act.
The cooperative bank is also regulated by the RBI. They are governed by the
Banking Regulations Act 1949 and Banking Laws (Co-operative Societies) Act,
1965.

Cooperative banks in India finance rural areas under:

• Farming
• Cattle
• Milk
• Hatchery

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 • Personal finance

Cooperative banks in India finance urban areas under:

• Self-employment
• Industries
• Small scale units
• Home finance
• Consumer finance
• Personal finance

Some facts about Cooperative banks in India

• Some cooperative banks in India are more forward than many of the state
and private sector banks.

• According to NAFCUB the total deposits & lendings of Cooperative

Banks in India is much more than Old Private Sector Banks & also the
New Private Sector Banks.

• This exponential growth of Co operative Banks in India is attributed

mainly to their much better local reach, personal interaction with
customers, their ability to catch the nerve of the local clientele.

BANK PROFILE

6
The Cooperative Bank, a widely diversified bank in India. Cooperative banking
is retail and commercial banking organized on a cooperative basis. Cooperative
banking institutions take deposits and lend money in india. Cooperative banking
(for the purposes of this article), includes retail banking, as carried out by credit
unions, mutual savings and loan associations, building societies and cooperatives,
as well as commercial banking services provided by mutual organizations (such as
cooperative federations) to cooperative businesses. Larger institutions are often
called cooperative banks. Some of these banks are tightly integrated federations of
credit unions, though those member credit unions may not subscribe to all nine of
the strict principles of the World Council of Credit Unions. Cooperative banking
systems are also usually more integrated than credit union systems. Local
branches of cooperative banks elect their own boards of directors and manage
their own operations, but most strategic decisions require approval from a central
office.

co-operative banks are owned and controlled by their members, who

democratically elect the board of directors. Members usually have equal voting
rights, according to the co-operative principle of “one person, one vote”.

In a co-operative bank, a significant part of the yearly profit, benefits or surplus is

usually allocated to constitute reserves. A part of this profit can also be distributed
to the co-operative members, with legal or statutory limitations in most cases. Co-
operative banks are deeply rooted inside local areas and communities. They are
involved in local development and contribute to the sustainable development of
their communities

Cooperative Bank working with its 822 branches all over Punjab.

Mission

We, The Co-operative Bank, will continue to develop our business taking into
account the impact our activities have on the environment and society at large.

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The nature of our activities are such that our indirect impact by being selective in
terms of the provision of finance and banking arrangements is more ecologically
significant than the direct impact of our trading opaerations.(Promotion and
sustainance of economic interest & providing easy finance, cost effective and
quality banking services ot customer & PACs).

Vision

Co-operative Banks are an important part of the financial system in India. It is,
therefore,necessary that the CBs emerge as a sound and healthy network of jointly
owned, democratically controlled, and ethically managed banking institutions
providing need based quality banking services, essentially to the middle and lower
middle classes and marginalized sections of the society.

Financial Highlights:

Financial Highlights
(Rs. in Crores)

March 2008 March 2009 March 2010 (Un-Audited)

Share Capital 33.09 43.60 63.94
Reserves 126.94 180.10 204.24
Deposits 1403.13 1712.07 2540.28
Advances 804.93 1252.79 1897.84
Net NPA (in %) 1.33 % 1.42 % 0.44 %
Working Capital 1640.46 2126.53 2989.33
Net Profit Before
35.89 35.41 35.28
Tax
Net Profit After Tax 27.90 30.67 26.86
Capital to Risk
14.49 % 13.36 % 13.43 %
Assets Ratio (CRAR)

8
PRESENT BOARD OF DIRECTORS

• Chairman – Naib Singh Kohar

• Vice Chairman – Budh Singh Dheerowal
• Managing Director – Anil Dutta
• Director – Sukhwinder Singh Lally
• Director – Bhupinder Singh Saini
• Director – Gurpal Singh Samra
• Director – Gurmail Singh
• Director – Hardev Singh
• Director – Sukhdev Dutt
• Director – Jaswinder Singh
• Director – Ranjit Singh Kahlon
• Director – Rajinder Singh Johal
• Director – Sukhwinder Singh

Souvenir Committee

• Chairman – Naib Singh Kohar

• Managing Director – Anil Dutta
• Director – Sukhwinder Singh Lally
• Director – Gurpal Singh Samra
• Distt. Manager – R.K.Guleria
• Sr. Manager – Surinder Sharma

9
 • President – Gurnek Singh Dhillon

INVESTMENT

Bank's Management has made an investment of over Rs. 2 crores. Investment

Breakup.

Punjab State Co-op. Bank Ltd.

100-00
Shares
Central Co-op. Bank Ltd. Shares 8400-00
Marketing Society-Shares 200-00
10.52% Punjab Loan 2010 1,10,00,000-00
11.85% Govt. of India 2009 22,00,000-00
11.03% Govt. of India 2012 10,00,000-00
10.70% Govt. of India 2020 25,00,000-00
10.25% Govt. of India 2012 3,500,000-00
Total 2,02,08,700-00

RATE OF INTEREST ON VARIOUS DEPOSITS

The Citizens Urban Co-operative Bank Ltd. Jalandhar is the only Urban Bank in
the Northern Region who is offering highest ever rate of interest on saving,
recurring and term deposits as compared to the other cooperative and nationalised
Banks.

10
Rate of Interest on various term deposits

15 days to 45 days 5%

46 days to 90 days
8%

91 days to 180 days 9%

181 days to Less than

10%
one year
1 year to less than 3 year
10.5%

3 years to less than 5

11%
year

5 years and above 11.5%

Saving Bank Deposit 5%

FEATURES OF COOPERATIVE BANK

1) Co-operative Banks are organised and managed on the principal of co-

operation, self-help, and mutual help. They function with the rule of "one
member, one vote". function on "no profit, no loss" basis. Co-operative
banks, as a principle, do not pursue the goal of profit maximization
2) Co-operative bank performs all the main banking functions of deposit
mobilisation, supply of credit and provision of remittance facilities.

11
3) Co-operative Banks provide limited banking products and are functionally
specialists in agriculture related products. However, co-operative banks
now provide housing loans also.
4) UCBs provide working capital loans and term loan as well.
5) The State Co-operative Banks (SCBs), Central Co-operative Banks
(CCBs) and Urban Co-operative Banks (UCBs) can normally extend
housing loans upto Rs 1 lakh to an individual. The scheduled UCBs,
however, can lend upto Rs 3 lakh for housing purposes. The UCBs can
provide advances against shares and debentures also.
6) Co-operative bank do banking business mainly in the agriculture and rural
sector. However, UCBs, SCBs, and CCBs operate in semi urban, urban,
and metropolitan areas also. The urban and non- agricultural business of
these banks has grown over the years. The co-operative banks demonstrate
a shift from rural to urban, while the commercial banks, from urban to
rural.
7) Co-operative banks are perhaps the first government sponsored,
government-supported, and government-subsidised financial agency in
India. They get financial and other help from the Reserve Bank of India
NABARD, central government and state governments. They constitute the
"most favoured" banking sector with risk of nationalisation. For
commercial banks, the Reserve Bank of India is lender of last resort, but
co-operative banks it is the lender of first resort which provides financial
resources in the form of contribution to the initial capital (through state
government), working capital, refinance.
8) Co-operative Banks belong to the money market as well as to the capital
market.
9) Primary agricultural credit societies provide short term and medium term
loans.
10) Land Development Banks (LDBs) provide long-term loans. SCBs and
CCBs also provide both short term and term loans.

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 11) Co-operative banks are financial intermediaries only partially. The
sources of their funds (resources) are (a) central and state government, (b)
the Reserve Bank of India and NABARD, (c) other co-operative
institutions, (d) ownership funds and, (e) deposits or debenture issues. It is
interesting to note that intra-sectoral flows of funds are much greater in co-
operative banking than in commercial banking. Inter-bank deposits,
borrowings, and credit from a significant part of assets and liabilities of
co-operative banks. This means that intra-sectoral competition is absent
and intra-sectoral integration is high for co-operative bank.
12) Some co-operative bank are scheduled banks, while others are non-
scheduled banks. For instance, SCBs and some UCBs are scheduled banks
but other co-operative bank are non-scheduled banks. At present, 28 SCBs
and 11 UCBs with Demand and Time Liabilities over Rs 50 crore each
included in the Second Schedule of the Reserve Bank of India Act.
13) Co-operative Banks are subject to CRR and liquidity requirements as
other scheduled and non-scheduled banks are. However, their
requirements are less than commercial banks.

SCHEMES FOR LOANS & ADVANCES

As Deposits are pouring in and crosses over a hundred crores mark, Bank's
management has decided to liberalise the loan structure and loans are being
advanced under priority sector to housing and weaker sections of the society at the
following rate of interest i.e.

Below 5 Lacs 15%

Over 5 Lacs 16%

13
 • Housing Sector - loans are being given @ 15% for residential purpose
whereas for commercial purpose, interest is being charged @ 16%.

Various loans schemes are initiated for granting loans to small scale industries,
shopkeepers, traders, unemployed youth, cars & transport vehicles, marriage,

house hold good items etc. at above mentioned rate of interest. Loans are also
being advanced to employees of the Municipal Corporation and the employees of
the other departments upto 50,000 under priority sector.

Term loans are your basic vanilla commercial loan. They typically carry fixed
interest rates, and monthly or quarterly repayment schedules and include a set
maturity date. The range of funds typically available is $25,000 and greater.

Bankers tend to classify term loans into two categories:

Intermediate-term loans. Usually running less than three years, these loans are
generally repaid in monthly installments (sometimes with balloon payments) from
a business's cash flow. According to the American Bankers Association,
repayment is often tied directly to the useful life of the asset being financed.

Long-term loans. These loans are commonly set for more than three years. Most
are between three and 10 years, and some run for as long as 20 years. Long-term
loans are collateralized by a business's assets and typically require quarterly or
monthly payments derived from profits or cash flow. These loans usually carry

14
wording that limits the amount of additional financial commitments the business
may take on (including other debts but also dividends or principals' salaries), and
they sometimes require that a certain amount of profit be set-aside to repay the
loan.

VARIOUS LOANS PROVIDED BY COOPERATIVE BANK

1) Scheme For – Financing Rural Housing

2) Scheme For - Urban Housing Loan Scheme

3) Personal Loan

4) Two Wheelers To Farmers

5) Consumer Durable Loans (salary/non-salary earners)

6) Cash Credit Facility – To Traders & Others

7) Vehicle Loan

8) Coop Rent – Loan Against Rental Income Scheme

9) Loan Scheme For Earnest Money

10) Scheme For Granting Of – Loan Against Property

11) Second Hand Vechicle Loan Scheme

12) Cooperative Education Loan Facility – For Children Of Poor

Farmers,Dalits/BCs and Others Poor Sections

15
 13) Scheme For Providing – Dairy Loan For Purchase Of Cow To Members
Of Cooperative Milk Producer’s Socieities

14) Mai Bhago Istri Shakti Scheme

15) Commercial Dairy Development Scheme

16) Cash Credit Limit For Consumption & Other Socio Economic Needs
(R.C.C.)

ORGANISATION STRUCTURE

The Citizens Urban Co-op. Bank Ltd., Jalandhar is a Body Corporate registered
under the Punjab Co-operative Societies Act 1961 and the rules framed there
under. The bank functions according to the Bye-Laws framed by it and registered
by the Registrar, Co-operative Societies, Punjab. The bank is governed under the
democratically elected Board of Directors who are well reputed persons of the
area. The term of the Board is 5 years. The Board has employed a Chief Executive
Officer and further staff to run day to day working of the bank.

FUTURE PLAN

The citizens urban co-op. Bank, Ltd. Jalandhar is a fast growing institution which
has made an indelible mark in the history of urban banking in Northern India. The
Board of Directors under the chairmanship of Sh. K.K. Sharma have drawn up

ambitious futuristic plans to compete with other Banking institutions in the region.

Sector wise proposed targets for the year 2001-02

16
 • Share Capital : The paid up share capital of the Bank as on 31-3-2001 is
4.09 crores. It is proposed to increase the paid-up share capital to Rs. 5
crore in the current financial year.
• New Branches : The citizens bank which has now nine branches is
planning to setup three more branches during the financial year 2001-02,
thereby increase the total number of branches to 12. The proposed places
for the setting-up of new branches are :
o Kapurthala
o Bhogpur
o J.P. Nagar, Jalandhar

The above branches are proposed to setup during the year subject to the approval
by the RBI. For the early issuance of licenses, necessary correspondence is being
made with the RBI. Besides that, to have it's own premises is the priority of every
organisation. Keeping this priority in mind, citizens bank has decided to get the
bank building constructed by the engineering cell of Punjab Markfed on it's 53
marla plot adjoining, Hotal Shangrila, Jalandhar and architectural assignment has
already been assigned.

DEPOSITS

Banks' management has always given significant importance to deposit

mobilisation in order to strengthen it's financial position. During the current
financial year too, a target of Rs. 132 crores has already been setup. Further
allocation has been made to Branches and their staff for meeting the same in a
stipulated time frame.

ADVANCES
17
As loans and advances are the real investments of a Bank as they earn income.
Keeping this in mind, the bank has decided to liberalise the loan structure and
proposed to advance Rs. 98 crores to various sectors in the current financial year.
Like the proceeding years, this year too, Board of Directors pledges it's
commitment toward the priority sector advances. Further Bank will also continue
it's efforts to promote housing, which has emerged as a national priority, by
providing financial assistance to various income groups. Above all, we believe in
production by masses instead of mass production, therefore we purposes to start
micro financing in a big way.

RECOVERY MANAGEMENT

Recovery management continued to receive the utmost attention of the Bank in

the last financial year 2000-01 and this trend would continue in the current
financial year too. Serious efforts would be made to bring down the N.P.A's level
which is currently stand at Rs. 1.72 crores. Bank is already planning to initiate
legal actions in such cases and recovery would be effected at the earliest.

HUMAN RESOURCE DEVELOPMENT

18
Human Resource development always find a high priority on the Bank's agenda in
the past and in the financial year 2001-02 too, number of measures will be taken
to upgrade and fine tuning the knowledge of it's officers and other sub-ordinate
staff including sending them to training in various institutes including Agriculture,
Co-op. Staff Training Institute, Jalandhar an undertaking of Punjab State Co-op.
Bank Ltd. and Vai-Kunth Mehta Insitute of Co-op. Management, Pune. Besides
that Executives & Directors will be send to attend various seminars and
workshops which will be conducted by NAFSCOB, New Delhi to educate them
about the Banking regulation act and co-operative societies act.

AUDIT AND INSPECTION

The Citizens Bank is periodically inspected by Reserve Bank of India and Co-op.
Department. The audit of the bank is conducted by the Audit Department of the
Punjab Government.

In addition to it, Bank has appointed it's auditors for Internal audit and checkup. It
is also worth mentioning that Citizens Bank has been classified by as 'A' class co-
operative Bank for the year 99-2000 by Chief Auditor, Co-operative societies,
Punjab Chandigarh for a record 10th time in succession.

INTRODUCING NEW CUSTOMER CARE SERVICE

Customer care is always the first and foremost duty of the Citizens Bank. Keeping
this aspect in mind, Bank is planning to introduce evening service at one of it's
Branch. Besides that, for saving the valuable time of it's esteemed customers and
to provide better and quick service, currency counting machines would be

19
installed in the remaining seven branches. This facility has already been provided
in the Head Office and it's Mithapur Branch.

BANK AT GLANCE

Position
93-94 94-95 95-96 96-97 97-98 98-99 99-2000 2000-01
as on
Share
Capital
91.91 116.00 155.64 230.00 280.00 336.00 381.00 409.00
Paid Up

Reserve
& Other 82.96 143.66 216.70 299.00 453.00 697.00 943.00 1219.00
Funds
Deposits 1614.04 1888.42 2977.60 4592.00 6866.00 8081.00 10390.00 11742.00
Loans &
1080.22 1381.46 2041.00 3472.00 5085.00 6628.00 8103.00 8834.00
Advances
Working
1861.80 2267.01 3452.00 5308.00 7890.00 9420.00 12085.00 13752.00
Capital
Net Profit 71.83 89.14 101.82 184.11 288.00 301.00 353.00 364.00

HAIWED ABDULLAH, Islamic Banking System, Islamic

Banking Concept, Islamic Banking, Afghanistan, Kandahar

20
October 12, 2008

Abstract:
The project identifies the concept of Islamic Banking, from its origin as
mentioned in the Holy Qur'an and reforms being introduced to meet the
requirement of today.
Section one, outlines the aims of the project.
The Second section, deals with methodological issues and attempts used to justify
the choice of researches variables, reasons why they were most appropriate to my
project undertaken.
Section Three, of the project looks at what the Quran says about Islamic finance.
It raises the question that Islamic finance is divinely revealed and must follow the
Shari'a (Islamic law), and therefore, financial transaction can only be conducted
within certain boundary. Section Four, will investigate the origin of Islamic banks,
how it has evolved with time, and also why there is this resurgent for this kind of
financial intermediary.
Section Five, will involve a full description of the reasons for the banning of
interest in Islam and its implication.
This will directly lead to Section Six, which will look into what is Islamic bank
and requirement necessary to be classified as a bank for Muslims, and also how is
the concept different from the conventional banks. This chapter will also look into
the many ways that Islamic bank provide services which is within the Shari'a.
Section Seven, will look at the practices of the Islamic banks and the permissible
forms of transactions. This will lead to section eight, which will look at the
problems facing Islamic banks. It will focus on aspect in terms of reforms and
improvement required in order for this kind of banking system to be effective.

Finally, Section Eight concludes the project by discussing briefly the how the
system is doing well and how it still needs to improve. Furthermore I will also
evaluate my methodology.

21
SHAH DEEPAK, Adequacy of Incentives Under National
Horticulture Board Soft Loan Scheme for Post-Harvest
Infrastructure Facilities
August 2007

Abstract:
In order to curb post-harvest losses of horticultural produce and attract private
investment in the horticulture industry, the National Horticulture Board (NHB)
had initiated soft loan schemes (SLSs) in 1993-94. Under these schemes, soft loan
assistance with a maximum limit of Rs. 1.00 crore is provided at the rate of 4 per
cent service charges per annum with one year moratorium period to set up projects
related to marketing, processing and also export oriented units and purchase of
plants and machinery for the same. The state of Maharashtra received the
maximum assistance under the scheme. The present investigation is an attempt to
evaluate the NHB soft loan schemes for the state of Maharashtra, specially with
respect to the post-harvest infrastructure (PHI) facilities created and adequacy of
incentives under the scheme. This study has made some interesting observations.
The focus of this study is specifically on two grape growers' societies. The study
showed a positive impact of soft loan scheme towards development of PHI
facilities in the area. However, in order to improve the efficiency of the soft loan
schemes, the study also suggested various measures which mainly revolved
around simplification of loan procedure adopted by the NHB, timely disbursement
of the loan, financing of the entire comprehensive project rather than for certain
specific components, subsidization of electricity tariffs for the

processing units, subsidization of sea freight, provision of funds for setting up of

Research and Development (R&D) unit for the marketing of produce, provision of
foreign market intelligence for the exports of horticultural crops, etc. Participation

22
of NCDC in working capital requirement of the grape growers' societies is another
suggestion of this study.

Keywords: Incentives Under Soft Loan Scheme for Post-Harvest Infrastructure

TOOLEY JAMES(Newcastle University - E.G. West Centre)The

Global Education Industry ,IEA Hobart Paper No. 141

Abstract:
The first edition of this pioneering book produced surprising conclusions from
research around the world into the extent of private education. Drawing on
examples from Argentina, Brazil, Colombia, India, Indonesia, Peru, Romania,
Russia, South Africa, Zimbabwe and other countries, Professor Tooley gave a
snapshot of private education that was unknown to many readers; contrary to
expectations, the private education sector was large in the countries studied, was
innovative, and was not the exclusive domain of the wealthy. On the contrary, he
found that the private sector often provided social responsibility, subsidised places
and student loan schemes.
Tooley identifies the factors that impede or facilitate the development of the
private education sector in various countries, focusing on the regulatory regimes
that may impinge upon private education. This led him to conclude with a
proposal for the role of for-profit education enterprises in promoting equitable
development.

In this second edition, Professor Tooley contributes a new preface which shows
how his work has developed and extended into other countries. In particular, he
provides a fascinating account of how private education is flourishing in China.

23
Keywords: education, development, third world, poverty

BARTH JAMES.R. ,
AUBURN UNIVERSITY

CAPRIO JR. GERARD

WILLIAMS COLLEGE

LEVINE ROSS , The Regulation and Supervision of Banks

Around the World: A New Database.February 2001,University of
Minnesota Financial Studies Working Paper No. 0006; World
Bank Policy Research Working Paper No. 2588

Abstract:
This new and comprehensive database on the regulation and supervision of banks
in 107 countries should better inform advice about bank regulation and
supervision and lower the marginal cost of empirical research.
International consultants on bank regulation and supervision for developing
countries often base their advice on how their home country does things, for lack
of information on practice in other countries. Recommendations for reform have
tended to be shaped by bias rather than facts.
To better inform advice about bank regulation and supervision and to lower the
marginal cost of empirical research, Barth, Caprio, and Levine present and discuss
a new and comprehensive database on the regulation and supervision of banks in

24
107 countries. The data, based on surveys sent to national bank regulatory and
supervisory authorities, are now available to researchers and policymakers around
the world.
The data cover such aspects of banking as entry requirements, ownership
restrictions, capital requirements, activity restrictions, external auditing
requirements, characteristics of deposit insurance schemes, loan classification and
provisioning requirements, accounting and disclosure requirements, troubled bank
resolution actions, and (uniquely) the quality of supervisory personnel and their
actions.
The database permits users to learn how banks are currently regulated and
supervised, and about bank structures and deposit insurance schemes, for a broad
cross-section of countries.
In addition to describing the data, Barth, Caprio, and Levine show how variables
may be grouped and aggregated. They also show some simple correlations among
selected variables
.

TUMEN SARAH , SHULRUF BOAZ , The effect of student loan

schemes on students returning to study.Published in: Journal of
Higher Education Policy and Management, Volume 30, Issue 4
November 2008 , pages 401 – 414
25
Abstract:
In this paper populations of students returning to tertiary study in the period 1997-
2005 have been compared with the population of non-returning students who had
the same opportunity to return. Such comparisons were conducted for students
who returned after a break of 1-7 years (seven comparison groups). Students with
the highest likelihood of returning were found to be: (i) students who had an
outstanding student loan prior to their return that had been borrowed for previous
tertiary studies; (ii) students who did not complete the qualification studied
previously; (iii) degree-level university students; and (iv) students who had
studied towards qualifications in health, education, society and culture rather than
in management and commerce fields. The major finding reported in this paper is
that a student loan debt does not discourage students from future study. The
findings also suggest that policy decisions were likely to trigger short-term
increases in returning behaviour and that the populations most affected were likely
to be those who left tertiary education in the year in which the policy decisions
were announced.

FIELDEN SANDRA L ,DAWE ADEL J , WOOLNOUGH

HELEN , University of Illinois at Urbana-Champaign's
Academy for Entrepreneurial Leadership Historical Research
Reference in Entrepreneurship

26
 Abstract:
Purpose – This study focuses on thefactors affecting equality of access to UK
government grant and loaninitiatives and the identification of gender differences
in the uptake of thoseinitiatives. Design/methodology/approach – A qualitative
methodology was adoptedas quantitative data is already available regarding the
sources and levels offinancing accessed. In total 32 interviews were conducted
with 18 women and 14men seeking business start-up capital. A review of the
advice and assistanceoffered by 31 business support agencies to potential and
existing male andfemale business clients across the region also was undertaken.
Findings – The findings revealed that there is a discrepancy in thenumber of men
and women business owners accessing grant and loans schemes.Women do not
enter into business ownership with the same amount of capital asmen, and women
are far more likely to access loans and grants than traditionalforms of financing.
Research limitations/implications – This is a preliminaryinvestigation which
needs to be extended and the relationship between serviceproviders and small
business owners further explored to provide a greaterunderstanding of the
complexities that relationship has on accessing governmentgrants/loans. Practical
implications – The grant and loan system is highly complexand fraught with
difficulties, which appears to exclude women and morespecifically those from
lower socioeconomic backgrounds, i.e. those they weredesigned to assist.
Originality/value – Previous research has focused on private sectorsources of
business finance. This study is the first to look specifically atgovernment

grant/loan schemes that are targeted at those business owners whoexperience

discrimination accessing traditional forms of finance.(Publisher’s Abstract)

Keywords: Loans, Males, Startups, Business assistance programs, Females, Firm

financing, Gender discrimination, Government grants.

27
Dr. K C CHAKRABARTY , Education Loan Scheme from
Indian Banks - Reserve Bank's Assurance

“No deserving student in India should be deprived of higher education, for

want of funds", - Dr K C Chakrabarty, Deputy Governor of Reserve Bank of
India assured the

Indian students, in an exclusive podcast interview taken on behalf of India Vision

Group and Action 2020 Team.

India Vision Group has been taking up periodically important issues of common
concern with respective higher Authorities with a positive approach to find out
best possible solutions. In the recent days, we have been receiving lot of
grievances from various 'voiceless' people that they could not pursue higher
education for want of funds.
One one side, it is reported that if the students are hailing from poor families, the
Banks do not consider them worthy of education loans, however brilliant they are.
They are asked to run pillar to post.; They are being asked to provide collateral
security even for small amounts, etc. On the other side, due to privatisation of
education, the cost of education has also gone up which could not be afforded by

these poor and intelligent students. There are many instances, where such brilliant
students end up their ambitions by joining some menial jobs. This century is
considered as Knowledge Century and the country is losing many people who
could have otherwise become great scholars and scientists, technocrats.

28
KHANDKER SHAHIDUR R.
WORLD BANK DEVELOPMENT RESEARCH GROUP

FARUQEE RASHIDUR R.
WORLD BANK ,
The Impact of Farm Credit in Pakistan,
November 30, 1999,
World Bank Policy Research Working Paper No. 2653

Abstract:
The Agricultural Development Bank of Pakistan (ADBP), which provides most
formal loans in Pakistan's rural areas, lends to largeholders far more than to
smallholders, although the impact of credit is greater for the smallholders.
Targeting credit to smallholders would make ADBP's credit scheme more cost-
effective. To reach poor farmers and farmers without assets - in other words, to
reduce poverty-stringent collateral requirements should be relaxed and outreach
should be broadened.Both formal and informal loans matter in agriculture. But
formal lenders provide much more in production lending than do informal lenders,
often at a higher cost than what they can recover. The Agricultural

Development Bank of Pakistan (ADBP), for example, providing about 90 percent

of formal loans in rural areas, incurs high costs on loan defaults.
Like other governments, the Government of Pakistan subsidized the formal
scheme on the grounds that lending to agriculture is a high-risk activity because of
covariate risk.
Because farm credit schemes are subsidized, policymakers must know if these
schemes are worth supporting. Using recent data from a large household survey

29
from rural Pakistan, Khandker and Faruqee estimate the cost-effectiveness of the
ADBP loans. To estimate credit's impact, they use a two-stage method, which
takes into account the endogeneity of borrowing.
Clearly, formal lenders are biased toward larger farmers with collateral. Large
landowners, who tend to represent only 4 percent of rural households, get 42
percent of formal loans. Landless and subsistence farmers, who represent more
than 69 percent of rural households, receive only 23 percent of formal loans.
ADBP loans improve household welfare but, although large farmers receive most
of the ADBP finance, the impact of credit is greater for small farmers than for
large farmers. Large landowners use formal loans unproductively.
Because the ADBP scheme is subsidized, it is not cost-effective for delivering
rural credit. It would be more cost effective if small farmers were better targeted
instead.
This paper - a product of Rural Development, Development Research Group - is
part of a larger effort in the group to understand the cost-effectiveness of
alternative credit delivery systems and their impact on rural poverty.
Working Paper Series.

OBJECTIVES OF THE STUDY

1) To study the customer awareness regarding loan schemes provide

by cooperative bank.

30
 2) To study consumer’s thinking towards loan schemes.

3) To study the satisfaction level of the customers.

NEED OF THE STUDY

31
If you need money to pay bills or make home improvements, and think the answer
is in refinancing, a second mortgage, or a home equity loan, consider your options
carefully. If you can't make the required payments, you could lose your home as
well as the equity you've built up. That's why it's important not to let anyone talk
you into using your home to borrow money you may not be able to afford to pay
back.

Not all loans or lenders are created equal. Some unscrupulous lenders target older
or low-income homeowners and those with credit problems. These lenders may
offer loans based on the equity in your home, not on your ability to repay the loan.
High interest rates and credit costs can make it very expensive to borrow money,
even if you use your home as collateral.

Talk to an attorney, financial advisor, or someone else you trust before you make
any decisions about borrowing money. Non-profit credit and housing counseling
services also can be useful in helping you manage your credit and make smart
decisions about loans.

SCOPE OF THE STUDY

32
If you’ve been at this business long enough, within a few hours of starting a loan
review you can usually get a pretty good sense how that bank is doing. The
remaining hours/days/weeks of a loan review are typically spent reinforcing those
initial findings (not to mention the billable hours).

At CRG, we’ve developed a quick review, called “Loan Scope,” that focuses on
an insightful big-picture analysis of your risk and control management as it relates
to lending. We serve as another pair of eyes by zeroing in on where your
institution is at the greatest regulatory and market risk. And we can do that in a
matter of hours, thereby saving you thousands of dollars.

While you may still want expanded loan reviews (and we’re willing to do them),
we find that our loan review provides our clients an excellent value by detailing
their key strengths and weaknesses, as well as a report that you can build upon
and measure against in the future.

Loan Scope reports address level and trend analysis from available sources as well
as logic in terms of your institution’s capacity to manage key elements of lending
risk, including CRE analysis, interest rate shock analysis and ALLL positioning.
We evaluate the strength of your control over the lending process by evaluating
personnel and their capacity to demonstrate control through key documentation.

RESEARCH METHODOLOGY

Introduction and Meaning

33
Research is a careful investigation or inquiry especially through search for new
facts in branch of knowledge: market research specifies the information. Required
to address these issues designs the method for collecting information manage and
implements the data collection process analyses the results and communicates the
finding and their implications.

Research problem is the one which requires a researcher to find out the best
solution for the given problem that is to find out the course of action, the action
the objectives can be obtained optimally in the context of a given environment.
Research will often help us reduce risks associated with a new product, but it
cannot take the risk away entirely. It is also important to ascertain whether the
research has been complete. For example, Coca Cola did a great deal of research
prior to releasing the New Coke, and consumers seemed to prefer the taste.
However, consumers were not prepared to have this drink replace traditional
Coke.

Surveys are useful for getting a great deal of specific information. Surveys can
contain open-ended questions (e.g., “In which city and state were you born? _”) or
closed-ended, where the respondent is asked to select answers from a brief list
(e.g., “__Male ___ Female.” Open ended questions have the advantage that the
respondent is not limited to the options listed, and that the respondent is not being
influenced by seeing a list of responses. However, open-ended questions are often
skipped by respondents, and coding them can be quite a challenge. In general, for
surveys to yield meaningful responses, sample sizes of over 100 are usually
required because precision is essential. For example, if a market share of twenty
percent would result in a loss while thirty percent would be profitable, a
confidence interval of 20-35% is too wide to be useful.

RESEARCH DESIGN

34
Research design is the arrangement for condition for data collection and analysis
of data in a manner that aims to combined relevance to research purpose with
economy in procedure.
A Research design is a master plan or model for the conduct of formal
investigation. It is blue print that it is fallowed in completing study. The research
conducted by me is a descriptive Research. This is descriptive in nature because
study is focused on fact finding investigation in a well structured form and is
based on primary data.

TECHNIQUES

The problem definition can be said to be the quite essential part of the research
process; as it determine precisely, what the managerial problem is and the type of
information that the research can generate to help the problem before conducting
the fieldwork. It is better to decide upon the method/technique of data collection.
Generally, there are two technique of data collection are:

1. Census Technique
2. Sample Technique or Convenient sampling

A census is a complete enumeration of each and every unit of population where as

in a sample only a part of the universe is studied and conclusion about the entire
universe is drawn about that basis. The census method is costlier and more time
consuming as compared to sampling method but the result are near representatives
than sample method. The availability of resources, time factor degree of accuracy
desire and scope of the problem enable us to apply sample technique.

Data Collection

35
 The objectives of the project are such that both primary and secondary data is
required to achieve them. So both primary and secondary data was used for the
project. The mode of collecting primary data is questionnaire mode and sources of
secondary data are various magazines, books, newspapers, & websites etc.

1) PRIMARY SOURCE

2) SECONDARY SOURCE

PRIMARY DATA are those which are collected a fresh and for the first time thus
happen to be original in character. There are several methods of collecting
primary data, particularly in surveys and descriptive researchers. Important ones
are:

1) Observation method

2) Interview method

3) Through questionnaires

4) Through schedules

5) Other methods which includes

a) Warranty cards

b) Pantry audits

c) Consumer panels

d) Using mechanical devices

e) Distributive audits

36
Under this PRIMARY DATA COLLECTION, i used as QUESTIONNAIRE to

collect the data.

SECONDARY DATA are those which have already published by someone else
and which have already passed though the statistical process. There are normally
two sources of collecting secondary data:

1) PUBLISHED SOURCES

2) UN-PUBLISHED SOURCES

Under this study we used DATA THROUGH INTERNET SOURCE to

collect the data.

RESEARCH PLAN

37
TYPE OF STUDY........

For completing my study we have gone for sample study because looking at the
size of population. And the time limitation it was not convenient for us to cover
entire population. Hence we have gone for sample study rather than census study.

SAMPLING PLAN

A Sample design is a definite plan for obtaining a sample from a given population.
It refers to the technique or the procedure that researcher would adopt in selecting
items to be inched in the sample i.e. the size of sample. Sampling plan is
determined before data are collected.

Sample Plan

Sample size: - Keeping in mind all the constraints 100 ordinary people were
selected.

Sampling Unit: - Jalandhar

Sampling Technique: - Convenient sampling

38
Anakysis and Interpretation

After the data collection, it was compiled, classified and tabulated manually and
with help of computer. Then the task of drawing inferences was accomplished
with the help of average and graphic method. Different suggestions given by me
to the Company after analyzing the views of every respondent are also given in
the report.

LIMITATIONS OF THE STUDY

It is said, “Nothing is perfect” and if the quite is true, I am sure that there would
be few shortcoming in this project also. Sincere efforts have been made to
eliminate discrepancies as far as possible but few would have reminded due to
limitations of the study. These are:

1. Limited scope
The survey was conducted in Jalandhar thus the respondents belonged to only this
region of the country. This could have brought bias into the study.

2. Nature of the study

The survey concentrated on personal information about incomend other factors.
All these issues are highly sensitive and of compplex nature therefore there could
have been untrue answers to some of the questions.

3. Ambiguous replies
Some of the respondents gave ambiguous replies for certain questions or omitted
the responses to some of them. The interpretation of such responses becomes
difficult and could generate wrong results.

39
 VARIOUS LOANS PROVIDE BY COOPERATIVE
BANK

THE PUNJAB STATE COOPERATIVE AGRICULTURE

DEVELOPMENT BANK Ltd.

Introduction

Punjab State Cooperative Agricultural Development Bank Ltd. is the apex body of
70 Primary Cooperative Agricultural Development Banks which make long-term
loans to farmers to enable them to make capital investment in agriculture and
allied activities, including land improvement and better methods of cultivation.
1994-95 Total amount of loans advanced Rs195.87 crore

Farm sector Non-farm sector

Amount Rs To weaker sections: Rs 9.29 crore to 1048
186.58 Rs4.38 crore beneficiaries
Recovery 87.4 percent

40
Every third tubewell installed and every fourth tractor in the state is financed by a
Primary Cooperative Agricultural Development Bank.

Objectives
The Punjab State Cooperative Agricultural Development Bank was established on
February 26,1958, under the provisions of Punjab Cooperative Land Mortgage
Banks Act, 1957 to free farmers from exploitation by moneylenders. The bank

provides long term loans at low rates of interest, repayable in easy installments.
Repayment period varies from 5-15 years, depending upon the purpose of the
loan.

At first the bank advanced loans to enable farmers to pay off old debts and
purchase of land so as to make their holdings economically viable. Later, the Bank
provided loans for improvement of alkaline and saline lands, for purchase of
tractors, tubewells and other modern agricultural equipment. The bank played its
role for the diversification of agriculture by providing loans to the farmers for
various occupations like dairy, poultry, fishery, horticulture, etc. Today, every
third tubewell and every fourth tractor is financed by this bank.

At present, the number of the Primary Cooperative Agricultural Development

Banks in Punjab is 79. From February, 1958 to March 31, 1997 the Bank has
advanced loans amounting to Rs.1619 crore.

Major Schemes/Projects

The bank is financing the schemes for the following purposes :-

Poultry Development Schemes :Under this scheme units of 500 birds and 1000
birds are financed

41
 Unit Cost (in Rs)
500 layers (1:2 system) 1,00,000
1000 layers (1:2 system) 2,00,000
1000 broiler 71,000

The loan is disbursed in three installments and recovered in 6 years. Grace period
is one year. In the next five years the loan will be recovered in 10 equal half-
yearly installments. The borrower must insurance birds and shed. Farmers must be
trained in Poultry Development by the Punjab Agriculture University or Animal
Husbandry Department of Punjab. Day old chicks be purchased from dealers
approved by the Animal Husbandry department of Punjab.

HOME LOAN

The Reserve Bank of India’s recent move to increase the home loan limit for
cooperative banks to Rs30 lakh from Rs5 lakh at present is likely to give a boost
to cooperative banking sector in the state. This is expected to be of great help to
rural middle class segment.

The RBI has decided that the maximum quantum of housing loan that can be
granted to an individual borrower by a state/central cooperative bank would now
be Rs20 lakh. However, in case of a cooperative bank having a net worth of
Rs100 crore and above, as per the assessment made in Nabard’s latest inspection
report, the limit will be Rs30 lakh.

The chairman of Gujarat State Cooperative Bank, Ajay Patel, has welcomed the
move. He said this step of the regulator has opened a safe avenue of credit for
cooperative banks. “The rural middle class is going to benefit from this move as

42
the presence of nationalised and private banks is very limited in rural areas,” he
said.

However, the aggregate of housing loans given to individuals, institutions and

societies on any day should not exceed 10% of total loans and advances of the
bank as on March 31 of the preceding year. However, this limit can be exceeded

to the extent of funds obtained for the purpose from a higher financing agency and
refinance from the Nation l Housing Bank. Earlier, the RBI had directed that
aggregate housing loans outstanding on any day should not exceed 5% of total
deposits of the banks.

Patel said as real estate prices in rural areas are also going up, this step of the RBI
was in the right direction. RBI has, however, clarified that housing loans would
not include finance to commercial real estate sector. Cooperative banks have been
advised that they should desist from financing the commercial real estate sector.

For repairs, additions, alterations etc to existing houses, the maximum amount of
loan per individual borrower stands revised to Rs1 lakh, which was Rs50,000 till
now.

LOAN FOR PURCHASE OF LAND

Govt. is encouraging consolidation of land. As part of this, term loan is available

to the tune of Rs. 50000/- to Rs. 10 lakhs to individual Small Farmers/Marginal
Farmers/Share cropper/ Tenant farmers for purchase of land. Loans given to
individual farmer to make the small and marginal holding economically viable
and to bring fallow and waste land under cultivation and to step up agricultural

43
production and productivity. Loan will be in the form long term in nature with
maximum period of 9 years including 2 years moratorium.

MORTGAGE LOAN SCHEME

This scheme provides loan/overdraft facility against mortgage of property at low

rate of interest. The scheme is for people engaged in trade, commerce & business
and also professionals & self employed, Prop. Firm, partnership firm, companies,
NRIs and individuals with high net worth including salaried people, agriculturists
and staff members. The product provides an opportunity to customers to borrow
against a fixed asset (mortgage of property) at a short notice without much paper
work/attendant hassles.

Margin : Salaried Employees 30% *

Others 50% *
*On value of property [Lower of Market Value /Distress Sale value/Registration
Value as on date of valuation] assessed by Bank's approved valuer.

Rate of Interest:
w.e.f. 21.07.2009 : For loans/overdrafts – 1% over BPLR, 13.00% p.a. Interest
concession for woman beneficiaries 0.25% p.a.[All borrowers to be women]

Repayment :

44
 In accounts where regular Overdraft facility is not proposed. :-
Within a period of eight years by way of EMIs. The repayment shall commence
from the month subsequent to the month in which final disbursement is made or 6

months from the first disbursement, Whichever is earlier. In case of agriculturists :

The repayment will be related to the generation of farm income from crops and
other subsidiary activities.

Security :

Equitable/Legal Mortgage charge over property in the name of applicant or his/her

spouse or parents or third party. The person in whose name the property to be
mortgaged stands should either be a borrower/co-borrower or a guarantor.

Note: :
a. The property offered should be a residential or commercial building or a plot of
land (residential/commercial).

b. The property should be self occupied or leased out to acceptable individuals,

government agencies, PSUs, Corporates, etc.

c. Agricultural land is NOT accepted as security for this facility .

PERSONAL LOAN

We grant Rupee loans to NRI customers against the following:-

45
 A)Security of funds held in NRO Term Deposits

B)Security of funds held in NRE Term Deposits, FCNR

(C) Deposits (Loan amount maximum upto Indian Rupee 100 lacs)

(D)Against the security of shares or other securities held in the name of the
borrower.

Please note that-

1) The loan shall be utilised for meeting the borrower's personal requirements or
for his own business purposes;

2) The loan shall not be utilised either singly or in association with other person,
for any of the activities in which investment by persons resident outside India is
prohibited, namely;(I) the business of chit fund, or (ii) Nidhi Company, or (iii)
agricultural or plantation activities or in real estate business (excluding
development of townships, construction of residential/ commercial premises,
reads or bridges), or construction of farm houses; or (iv) trading in Transferable
Development Rights (TDRs). (v) Investment in capital markets including margin
trading and derivatives.

3)The Reserve Bank's directives on advances against shares/securities/immovable

property shall be duly complied with

4) The loan amount shall be credited to NRO account of the borrower

5) The loan amount shall not be remitted outside India.

46
Repayment:Repayment shall be made by fresh inward remittances from outside
India through normal banking channels. The loan can be also repaid out of the
local rupee resources in NRO/NRE/FCNR account of the borrower or through sale
proceeds of shares or securities or immovable property against which such loan
was granted.

CAR LOAN

Flexi Mobile Loan from the bank belongs to the category of the Bank Limited
Car Loans. This is a customized financing scheme for car procurement, specially
meant for professionals, individuals, businessmen and traders. Car Loans are also
available for the procurement of used cars (second hand ones).

Customers can finance up to 80% of the cost of a new vehicle along with the cost
of accessories and the life tax through this loan. For second hand cars the
financing margin provided by the bank is 30%. The maximum loan available
under this scheme is Rs. 7.50 Lacs.

DAIRY LOAN

Credit for Individuals and group of farmers for Purchase of high yielding milch
animals (Cattle: Indigenous breed like Gir, Tharparker, etc. and exotic breeds like

47
Jersey, Holstein fresian, etc. and in case of Buffaloes: Mehsana, Jafarbadi, etc.),
Construction of cattle shed, Purchase of dairy equipments, chaff cutters, etc and
expenditure incurred for transportation of animals where the animals are not
purchased locally.

Eligibility

Individuals and group of farmers experienced in Dairy farming and are actively
engaged in such activity.

HOUSE RENT LOAN

Learn more about our Home Rent Loan Scheme under TMB Retail Loan
Products.

This loan product can be used to avail loans against future rental receipts of your
properties. The rent received every month is used as the EMI towards the loan
sanctioned. Any Lessor having a residential / commercial property which is
currently rented to MNC / Banks / Reputed Corporates etc. can apply for loan
under this scheme. Loans can be availed for 36 months or residual lease
agreement whichever is less for upto Rs. 50 Lakhs.

Purpose

To meet the financial requirement of the owner (applicant) of the building

(Lessor).

48
Eligibility

Owners of buildings and commercial properties in Semi urban/Urban/Metro areas

which are to be rented or already rented to Multi National Company's / Banks /
Reputed Corporates etc.

Loan Amount

75% of the rent receivable less TDS if any, over the period of 36 Months or
Residual Lease / Rent Agreement period whichever is lower subject to a
maximum of Rs.50.00 Lakhs.

Security

On EQM of building against the rentals of which the loan would be sanctioned.
(150% of the loan amount should be covered as collateral security).

Pre-requisite

Assignment of rent receivables from lessor is must. If lessee agrees to remit the
rent directly to the loan account of the borrower, a power of attorney should be
obtained from the Lessor and Lessee.

49
Repayment

5 Years or residual lease/rent agreement period, whichever is lower.

Rate of Interest

• If the lessee agrees to remit the rent directly to the Loan account of the
borrower - PLR + 0.00% (14.00% p.a.).
• If the lessor (Building Owner) remits the monthly instalment to the loan
account from the sources of rent and other sources - PLR + 1.00%
(15.00% p.a.).
• Current Prime Lending Rate (PLR) is 14.00% p.a.

Margin

25% on the future rent to be received less TDS if any. (Maximum of 36 Months)
or residual lease/rent agreement.

EDUCATIONAL LOAN

Purpose
Studies in India & Abroad

50
Maximum Loan Amount
Rs 20.00 lakhs

Eligibility
100% of cost of the fees and other expenses on the basis of the eligibility and
income proof provided by the applicant.

Limit of Loan

Studies in India -Maximum upto Rs 10.00 Lakhs(All IBA approved courses)

Studies abroad - Maximum upto Rs 20.00 Lakhs

Rate Of Interest:

Please contact your nearest branch for repayment plan and interest rates

Repayment Period

Maximum 84 months inclusive of Moratorium period of Max 3 years

Moratorium Period: Duration of the course plus an additional period of six months
or 3 years whichever is earlier.

51
Security

Equitable mortgage of Property or pledge of any other tangible security acceptable

to the bank.

Minimum two guarantors of well placed means.

Tangible Investments like LIC (Surrender Value), NSC (Face Value), KVP (Face
Value), Gold (As per Banks Valuation), RBI Bonds or FD’s with our Bank can be
considered while assessing the proposal and for sanctioning the loans.

Processing Fees:

For studies in India – 0.25%

For studies abroad -- 1% of the loan amount

Shareholding

• Upto Rs 2 lakhs-nominal membership or 5% of the loan amount

• Above Rs 2 Lakhs -2.5% of the loan amount(max Rs 25000)
• Key features of the scheme:
• No prepayment charges.

52
 • Issue of solvency certificate
• Foreign currency/Demand draft/Travelers Cheques
• Loan available on admit letters.
• Phased disbursement facility available.
• Travel insurance available

• Arrangement with Wells Fargo Bank for opening an International Personal

Banking Account in US.

Steps to Avail our loan.

1. Covering letter addressed to the Branch Manager mentioning details of

course, college, details of total expenses to be incurred on the course, bank loan
applied for, own stake details if any which is going to be brought in, security
offered, moratorium period details

2. Application form duly filled in.

3. Students documents:

• Offer letter from university / college / institutes stating details of course

and admission procedure/s
• Conditional or unconditional offer in case UK, Canada or New Zealand.
• In case of students going to USA – I 20 / Admit letter to be submitted.
• Passport copy (in case of education abroad) or identity proof.
• Latest academic mark sheets
• Work experience proof if any
• 1 photograph
• Pan Card copy

53
 • Address proof - Copy of ration card/ Copy of MTNL/ BSES bill/ Copy of
driving license/ Election card.
• 1 photograph each.
Applicant (Singly or Jointly) with Co-applicant as student / Sponsorer
(only close blood relative) & Guarantors documents:

Income proof

(i) If Salaried:
3 months latest salary slips
6 months bank statements where salary is credited/ other bank statements if
any Income tax returns of last 3 years,Latest Form 16

(ii) If Businessmen/ Self-employed:

Income tax returns of last 3 years and computation of income, balance sheet
and profit & loss a/c.
6 months bank statements where current a/c is maintained / other bank
statements if any

5.In case of students going to USA - Statement of Asset.

FARM MACHANIZATION

The product aims to give credit for purchase of Farm machinery/Irrigation

equipments for agricultural operations. The scheme covers activities ranging from
purchase of tractors and accessories, power tillers, combine harvesters, power
sprayers, dusters, threshers etc.

54
Eligibility

For pump set/ Irrigation equipments Farmer should own a minimum of 2 acres of
irrigable land. For Farm machinery, following is the Minimum irrigated land

• For power tillers – 2 acres

• For tractors with power upto 35 HP – 4 acres
• For tractors with power above 35 HP – 6 acres
• For combine harvesters – 8 acres

Loan Amount

Minimum: Rs.30, 000 /- and maximum: Rs. 30 lakh.

CONVENIENT LOANS AGAINST PROPERTY

Amongst the variety of loans available these days, to help tide over a cash crunch,
banks offer loans against property. Here’s how this works and why it scores over
other types of loans. Ifyou are sitting on a valuable asset in the form of a property,
you never have to worry about your loan applications being rejected. Banks offer
a product called Loans Against Property (LAP), which gives you access to
finance, on the basis of the property that you hold.

55
Eligibility

LAP is offered to individuals between the age group of 18–60 years and who are
either salaried employees, professionals or selfemployed. Union Bank of India
also offers loans to individuals who don’t pay income tax, as long as they
provide proof of income to the bank. State Bank of India offers loans to
individuals who are engaged in agricultural and allied activities, too.

Loan Details

Value of property: An individual can avail of a LAP by mortgaging his own

property i.e. his residential property. The loan will be approved only if the
residential property is self-occupied; property, which is rented out, is not
covered under this scheme. However, these loans are not offered if the market
value of the property is below a predetermined specification of the issuing bank.
For instance,ICICI Bank offers LAP to individuals only if the market value of
their property is at least Rs 11 lakh, while Kotak Mahindra considers property
that is worth Rs 20 lakh plus. Some lenders, like HDFC are willing to offer a
LAP for property that is worth as little as Rs 5 lakh. Tenure: A LAP is usually
given for a period of 10 to 15 years.

For instance, ICICI Bank offers such loans for a tenure of 15 years and HDFC
sanctions these loans for a period of 10 years. Loan value: Most lenders offer a
minimum loan of any where between Rs 1 lakh to Rs 5 lakh and a maximum of
Rs 50 lakh, (subject to the value of the property that the individual possesses).
For example, ICICI Bank sanctions a minimum of Rs 5 lakh and finances up to
45-60 per cent of the technical market value of the property.

56
However, it stipulates that the property should be only 25 kilometres away from
an ICICI Bank branch. Kotak Mahindra sanctions loans that are up to 50 per cent
of the market value of the property while HDFC offers up to 60 per cent of the
market value with a minimum loan amount of Rs 1 lakh and a maximum loan
amount of Rs 50 lakh. Union Bank of India offers a maximum loan limit of
Rs 25-50 lakh and a minimum of Rs 1 lakh. State Bank of India lends a minimum
of Rs 1 lakh and a maximum of Rs. 50 lakh subject to the loan amount being
restricted to 24 times the net monthly income of a salaried borrower (net of all
deductions, including TDS) or twice the net annual income for other borrowers
(income as per the latest IT return, less taxes payable).

Repayment Terms

There are a variety of repayment options available in the market to suit the needs
of the various borrowers. State Bank of India allows you to repay your loan
within a maximum of 60 Equated Monthly Instalments (EMIs). HDFC’s LAP
can be repaid over a maximum period of 15 years on an EMI basis. Kotak
Mahindra Bank allows you a loan repayment period of up to 20 years, which
varies depending on the purpose of the loan and the individual’s profile. Union
Bank of India’s loan must be repaid within a maximum of 60 EMIs with the
bank collecting postdated repayment cheques.

Documentation

In addition to the standard documents that must be deposited with the bank in

57
 order to avail of a loan, in the case of a LAP, banks also usually ask for:
Allotment letter of the co-operative society. Agreement for sale/sale deed for the
property. Original title deeds of the property offered for mortgage. Paid receipt

of latest maintenance, water tax, municipal tax and any such taxes. A non-
hindrance letter from the cooperative society.

NRIs HOUSING LOAN

Purpose

For construction, purchase/repair/renovation/alteration of a house or for purchase

of a plot for the construction of a house for self occupation on return to India.

Persons Eligible

a. All Non Resident Indians holding Indian Passports with a regular monthly
income of not less than Rs. 10000/-

b. Spouses and close relatives of Non-Residents, who are residents jointly with
the non-resident Indian.

58
 Amount of Loan

60 times the Net Monthly Income (NMI) / Average Monthly Income (AMI) for
persons upto 45 years and 48 times for persons above 45 years of age. However,
the repayment obligation is restricted to Maximum 60% of the NMI/AMI.

Margin

• Upto Rs.30 lac - 20%

• Above Rs.30 lac and upto Rs.3 crore - 25%

Interest

Linked to our Prime Term Lending Rate and subject to change click on the link
for present interest rates.

COSMOS LOAN

Initiated in the year 1906, the Cosmos Co-operative Bank Ltd is widely known as
for its excellent services. Being the oldest municipal co-operative banks in India,
Cosmos is at present the nation?s foremost organized Co-operative banks with its
multi state presence.

Cosmos Co-operative Bank Ltd, over the years, has carved a market for itself in
the metropolitan banking segment, facilitated by its affluent legacy, honesty,

59
devotion to the discreet banking measures and technology driven client facilities.
It has also accomplished comprehensive expansion not only in context of
monetary pointers or levels but also in general growth of measures.

The fiscal arrangement of Cosmos Co-operative Bank Ltd in the year 2009 was
Rs. 10946.37 crs entailing investment worth Rs Rs.6843.02 crs and credits worth
Rs. 4004.36 Crs. The bank functions through its 96 sub divisions and 8 annex
segments spread across the nation. Some of its major branches are in the states of
Maharashtra, Gujarat, Karnataka, Madhya Pradesh, Bangalore and Andhra
Pradesh.

LandmarksAchieved

Some of the landmarks achieved by Cosmos Co-Op. Bank Limited are mentioned
as

• The foremost co-op bank with multi state presence that deployed
nationalized banking network
• It has a set up of 93 subdivisions, provincial divisions and headquarter
inter linked via the information hub located at Maharashtra.
• It provides 24/7 banking services through its various ATM set-ups
• Deployment of around 96 ATM's near each of its subdivisions
• Around 55,000 ATMs are linked via NFS and Bancs joint venture.
• It offer sweep service of capital transfer between bank accounts of clients
• It provides the facility to reassign capitals immediately to any account in
their subdivision set-up
• Providing RTGS or NEFT facility for immediate capital transmittal
• Provision for franking service
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 • Provision for online tariff imbursement service
• Account transactions are accessible via e-mails

• Availability of intermittent interest on Fixed Deposits in expend via the

Electronic Clearing Scheme (ECS).
• Availability of SMS service for bank account balance, details of previous
bank transactions and other status.
• Availability of recognition by Pune Corporation Tax
• Facility for cell phone and telephone bill imbursement besides payment of
premiums

ProductandServices

Some of the products and services offered by Cosmos Co-Op. Bank Limited are:
Deposit Schemes such as Cosmo Umbrella, Janasanchay savings scheme,
cosmos kishor scheme, flexi-fixed deposit scheme, etc

• Loan Schemes with loans of upto Rs 2 Lakhs at 14.50% of rate of interest

on yearly basis.
• Foreign Exchange Business for NRIs. Accounts available under this
category are Non Resident Ordinary Account (NRO), Non Resident
External Account (NRE), Foreign Currency Non-Resident Account
(FCNR) and Exchange Earner Foreign Currency A/c (EEFC)
• Demat account services

61
FinancialPerformance

The details of financial report of Cosmos Co-Op. Bank Limited as on 2009 are as
under:

• Share Capital estimated as on the year 2009 is Rs 87 Crores

• Reserves estimated as on the year 2009 is Rs 613 Crores
• Net Worth estimated as on the year 2009 is Rs 700 Crores
• Credits estimated as on the year 2009 is Rs 6656 Crores
• Advances estimated as on the year 2009 is Rs 3896 Crores
• Endowments estimated as on the year 2009 is Rs 2869 Crores
• Profit estimated as on the year 2009 is Rs 90 Crores
• Working capital estimated as on the year 2009 is Rs 7563 Crores.

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 FINDINGS

1. Co-operative bank have different schemes for different

fields.

2. The study has shown that customer wants better branch

network and improved services so that they can take loans
from different cities also.

3. The study has shown that many people don’t want to take
loan from co-operative bank because they think that these
banks do not provide services like ATMs, phone banking,
internet banking etc.

4. From the study we find that the services of Co-operative

bank are satisfactory.

5. From the study we noticed that the procedure for taking

loan is easy.

6. From the study we searched that the paper work &

formalities for taking loan is much more.

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Q1. What do you think about the services that Co-
operative bank has been providing?

RESPONSE %AGE
GREAT 44%
SATISFACTORY 56%
BAD 0%
TOTAL 100%

0%

44%

56% great
satisfactory
bad

INTERPRETATION:-
From the above data it has been seen that 44% said the
services are great and 56% said services are satisfactory and

64
no one said the services are bad. Which depicts that most of
the customers are satisfied wih the facilities and services
provided by co-operative banks.

Q2. Are you aware about the Loan services of Co-

operative bank?
RESPONSE %AGE
YES 40%
NO 20%
KNOW A LITTLE 40%
TOTAL 100%

40% 40%

yes
no
know a little
20%

INTERPRETATION:
As per the responses from the customers its evident that there
are mixed responses by them , according to their responses
there is equal response in favour of knowledge regarding the
loans schemes by the bank and the same is found that similar
65
%age of people are having a little knowledge about the loan
schemes.
Q3.The procedure that the customer has to follow for
taking a loan from Co-operative bank is easy?
RESPONSE %AGE
SRONGLY AGREE 20%
AGREE 30%
SOME WHAT AGREE 10%
DISAGREE 20%
STRONGLY DISAGREE 20%
TOTAL 100%

20% 20%

20% strongly
agree
30% agree

10% some what

agree
disagree

strongly
disagree

INTERPRETATION:
As per the customer responses, the procedure to follow for
loans is found to be easy as 20% of people strongly agree,

66
30% agree, 10% some what agree, 20% of people disagree
and 20% of people strongly disagree that is an easy task.
Q4. The Co-operative bank has played a great role in
the over all development of the state?

RESPONSE %AGE
AGREE 70%
SOME WHAT AGREE 10%
DISAGREE 20%
TOTAL 100%

20%

10%
agree
some what agree
70%
disagree

INTERPRETATION:
The role of co-operative banks is considered to be important
in the development of state by 70% of people agree,10% of
people some what agree and the rest of 20% are disagree with
this statement.

67
Q5. Do they have a good relationship with the
customers?

RESPONSE %AGE
YES 80%
NO 0%
CAN’T SAY 20%
TOTAL 100%

20%

0%

yes
no
can't say
80%

INTERPRETATION:
As per the responses 80% of the people say that co-operatives
banks keep good relationship with their customers whether
20% of people are can”t say about this statement.

68
Q6. Are you satisfied from the interest that Co-
operative bank charge on loans provided by the bank?

RESPONSE %AGE
YES 40%
NO 60%
TOTAL 100%

40%

yes
60%
no

INTERPRETATION:
As per the responses its found that 60% of people think that
interest rates provided by co-operative banks are not
satisfactory and 40% of them think its fine.
69
Q7. Do you think that you get better returns from Co-
operative bank in comparison to the other banks?

RESPONSE %AGE
YES 40%
NO 20%
CAN’T SAY 40%
TOTAL 100%

40% 40%

yes
no
can't say
20%

INTERPRETATION:
Its evident from the responses that 40% of people expect
good returns from the co-operative banks and 40% are unable
to justify whereas 20% of people think it don’t offer good
returns.

70
Q8. How do you compare the schemes with the
schemes of other bank?

RESPONSE %AGE
MINIMUM BALANCE 0%
REQUIRED
SECURITY TO BE PLEDGED 40%
RATE OF INTEREST 40%
PAPER WORK/FORMALITIES 20%
TOTAL 100%

0%

20%
40%
minimum balance required
securityto be pledged
rate of interest
40%
paper work/formalities

INTERPRETATION:
As per the response people compare the loan schemes with
schemes of other banks through 40% are with security to be
pledged,40% based on rate of interest and rest 20% compare
with paper work/formalities.

71
Q9. Are you aware of all formalities involved for
sanctioning of loan?

RESPONSE %AGE
YES 50%
NO 50%
TOTAL 100%

50% 50%

yes
no

INTERPRETATION:
Its evident from the graph that 50% of the customer
responses are aware of the formalities of loan and the same
%age is for non awareness of the loan formalities.

72
Q10. In your opinion what do you feel which bank
cares more about the customer satisfaction?

RESPONSE %AGE OF FARMERS

CO-OPERATIVE 40%
PRIVATE 50%
PUBLIC 10%
TOTAL 100%

10%

40%

co-operative
private
50%
public

INTERPRETATION:
As per response 40% people said that co-operative bank cares
about the customer satisfaction,50% said private bank and
rest 10% said public bank.

73
 SUGGESTIONS
There are some suggestions to Co-operative bank.
There suggestions are as follow:

• Interest rate on Gold loan of Co-operative bank is

higher than other banks. So Co-operative bank
should reduce interest rate on gold loan or it
should provide some more facilities on that loan.

• Bank should reduce interest rate and increase the

amount of personal loan to attract borrowers.

• Interest rate, rebate and amount of hypothecation

loan of both banks are generally same. The bank
should reduce time period of hypothecation of loan
because it is too high than Co-operative bank.

• Bank should reduce the interest rate and increase

the amount of self-employed loan to attract the
borrowers.

• The banks should have to concentrate on increase

the recovery of loan to reduce the amount of
overdue and doubtful debt because recovery of
total loan of Co-operative bank is less than the
other banks.
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 CONCLUSION

After having done detailed study on the topic “Various Loans provided by Co-
operative bank”, it has been concluded that Co-operative Bank is being able to
achieve its corporate vision and mission tactfully and progressively by providing
different types of loans schemes at competitive rate of interest. Gone are the days
when it was too difficult for the people to buy different types of properties, cars
education etc.

Now this all have become possible with the help of various loans given by at
affordable rate of interest. Although many banks are providing these loans
schemes but people prefer to avail loans from Co-operative Bank.

About the awareness regarding the loans offered by Co-operative Bank, I

conclude that most of the people are aware but they still need more publicity
among the people. From the study, I conclude that there are some weaknesses in
the bank but as it is well growing bank, they are working hard to overcome these
weakness and threats.

75
 BIBLIOGRAPHY

BOOKS:-

Itbach Philip G.A, International Book Publishing,

volume 1995, Part-2

Naidha kumar jain, How to borrow from Banking

and Financial Institutions

LINKS:-

1) http://www.pmcbank.com/profile.asp

2) http://rbidocs.rbi.org.in/rdocs/PublicationReport/docs/61370.doc

3) http://en.wikipedia.org/wiki/Cooperative

76
4) http://www.novinite.com/finart/carloans/cooperative_bank_loans.html

5) http://pbcooperatives.gov.in/Urban_CoopBank.htm

6) http://www.poduniversal.com/2010/01/education-loan-scheme-from-
indian-banks.html

7) http://www.informaworld.com/smpp/content~content=a904520545~db=all
~order=page

8) http://papers.ssrn.com/sol3/papers.cfm?abstract_id=632721

9) http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1283093

10) http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1503869

11) http://propertybytes.indiaproperty.com/index.php/home-loans/home-loan-
cap-for-coop-banks-raised

12) http://agritech.tnau.ac.in/banking/crbank_prib_10idbi1.html

13) http://business.mapsofindia.com/banks-in-india/cosmos-co-operative-
bank.html

77
 QUESTIONNAIRE

Q1. What do you think about the services that Co-operative

bank has been providing?
Great

Satisfactory

Bad
Q2. Are you aware about the Loan services of Co-operative
bank?
Yes

No

Know a little
Q3. The procedure that the customer has to follow for taking
a loan from Co-operative bank is easy?
Strongly agree
78
 Agree
Some what agree

Disagree

Strongly disagree
Q4. The Co-operative bank has played a great role in the over
all development of the state?
Agree
Some what agree

Disagree

Q5. Do they have a good relationship with the customers?

Yes

No

Can’t say
Q6. Are you satisfied from the interest that Co-operative
bank charge on loans provided by the bank?
Yes

No

Q7. Do you think that you get better returns from Co-
operative bank in comparison to the other banks?
Yes

No

79
 Can’t say
Q8. How do you compare the schemes with the schemes of
other bank?
Minimum Balance Required

Security To Be Pledged

Rate Of Interest

Paper Work/ Formalities Required

Q9. Are you aware of all formalities involved for sanctioning
of loan?
Yes

No
Q10. In your opinion what do you feel which bank cares
more about the customer satisfaction?
Co-operative Bank

Private Banks
Public Banks

80