Professional Documents
Culture Documents
EXECUTIVE SUMMARY
The study carried out in the SHRI SHIVAJI MAHARAJ CREDIT CO-OPRATIVE
SOCIETY on Analysis of loans and Advance is completed in the bank the bank on
the basis of data provided by bank, the entire study on Loans and Advance is
done under supervision of internal guide appointed by college and the external
guide appointed by bank in the supervision of the both the guide the study will
completed. The study was under taken during the period from 15 th December
2018 to 15th January 2019 as a partial fulfillment of the requirement for the award
of the degree of Master Business Administration of Rani Channamma University.
About the introduction of the topic is done under introduction part of report
which carries brief information about the project which contains history of the
bank and objective of the bank .
The project carried out to understand the proprietary and efficiency position of
the bank during the study period and to study about the organization profile and
hierarchy . It is also useful to make comparisons between the Loans and Advance
during different period.
The information required for the study is collected from the bank’s annual report
banks websites and Books of the bank .
By the analyzing the different years , the current year loan provided to customers
is increased during the study period .And the interest earned is also increase and
it is working satisfactory.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Chapter -2
Industrial profile
Company profile
Topic Introduction
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
A bank is business which provides financial service for profit. Traditional banking
services include receiving deposits of money. Lending of money and processing
transaction. A bank plays premier role in the financial statement of country. The
banking activities include acceptance of deposits, repayment of the same
demand, lending the surplus funds to earn profit by way of interest, commission,
brokerage etc.
The term banking means “accepting money for the purpose of lending or
investment of money from public, repayable on demand or otherwise and
withdraw by cheque, draft or otherwise”.
According to H.P.SHELDON’S:-
According to H.L.HART:-
“One who in the ordinary course of his business honors cheques, drawn upon his
by person from whom he receives money on current accounts”.
ORIGIN OF BANK
The origin of the term ‘bank’ is derived from the Indian Italian Word ‘Banco’
Latin word “Bancus” and the French word ‘Banque’ which means a brench. But
some other people have opinion that word ‘Bank’ is derived from the German
word ‘Bank’ which means a joint stock of funds or common fund raised from a
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
large number of member of the public. In Italy, Greece, England and other
European countries, the basic function of money lender was the money lending
and money changing.
In England, the origin of banking can be traced to the goldsmith, who used
to perform the function of lending and changing money. The goldsmith used to
accept deposit gold or money from the rich people for safe custody and issue
receipts for the same. In course of time, because of lack of confidence in
goldsmith, independent banking institution where setup to finance, commerce,
trade industry. By 1830, big bank formed as joint stock companies under the
regulations of government came into existence in England and later in other
countries.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
The first bank in India, through conservative, was established in 1786. From 1786
till today, the journey of Indian Banking System can be segregated into three
distinct phases. They are as mentioned below:
The history of Indian banking from the performs of money lending business
a small no. of money lenders with huge financial resources and diversified banking
activities spread over on parts of the countries.
In Italy, Greece, England, and European countries, the basic functions of these
earlier bankers was money lending and money changing. In England, the origin of
banking can be traced to the goldsmith who where performing the functions of
lending and changing the money.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Banks are playing a very useful role in the development of trade, commerce
and industry they have become indispensable to the economic development of
the country they crate credit, mobilize the saving of the people and provides
funds to the business. They perform several function, which are useful and
valuable to, trade and industry.
Banking was existence even in the ancient times. There is evidence to provide
that money lending was carried on interest basis. Ancient texts like kautilya’s
arthashatra contain reference to loan, interest and regulation pertaining them.
The banking business that is money lending business was carried on according to
conventions and customs. The money lenders enjoyed a good status in the society.
Even today, money lenders exist in villages while indigenous bankers exist in cities.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Indian Foreign
Banks Banks Central Co-operative
Banks
State Bank Nationalized
Group Banks
Primary Credit
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Function of banking:-
1. Accepting deposits:
By accepting deposits, bank mobilizes the saving of the people and uses them for
productive purpose.
The banks mobilize the dormant capital of the people and provide the same for
productive purpose.
3. Remittance of funds:
The commercial banks provide cheque and quick media of transmission of funds
from our place to another.
4. Creation of money:
The banks create credit money while lending the business community.
They issue and accept credit instrument like bill of exchange for discounting
purposes.
6. Financing of industry:
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Bank is a financial institution which deals with other people’s money i.e money
given by depositors.
3. Acceptance of Deposit
A bank accepts money from the people in the form of deposits which are
usually repayable on demand or after the expiry of a fixed period. It gives safety to
the deposits of its customers. It also acts as a custodian of funds of its customers.
4. Giving Advance
A bank lends out money in the form of loans to those who require it for
different purposes.
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
9. Connecting Link
A bank should always add the word “ bank” to its name to enable people to
know that it is a bank and that it is dealing in money.
Kinds of Banks:
Banks may be classified into the following major categories:
1. Commercial banks.
2. Center banks.
3. Exchange banks.
4. Indigenous bankers.
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
1.Commercial Banks:
Commercial banks are the joint stock companies, which deal in money and
credit. A commercial bank may be defined as financial institution, which accepts
deposits from the public deposits, withdraw able by cheque and uses such
deposits of money for lending purpose. Commercial banks render various utility
services and agency services to their customers and the general public.
2.Central Bank:
in every country, there is one bank called a central bank, which is the highest
monetary and banking authority in the country. It also controls the volume of
credit created by the commercial banks and manages the issue and circulation of
currency notes so as to safeguard the financial in the country. It controls, regulates
and supervises the activities of all other banks in the country.
The central bank of India is the ‘Reserve Bank of India’ established in 1935,
originally as a shareholders’ bank in the private sector but later on it was
nationalized in 1949.
3.Exchange Banks:
Exchange banks are a special type of banks, which finance mainly the foreign
trade of the country. As the financing of foreign trade involves the buying and
selling of foreign currencies, these banks are known as exchange banks they enjoy
complete monopoly in the field of foreign trade. There were 14 foreign exchange
banks with 129 branches at the end of 1992 running in important cities and towns
in Indi. All the foreign exchange banks working in India at present are
unfortunately owned, managed and controlled by foreigners and therefore they
are known as Foreign Exchange Banks.
4.Indigenous Bankers:
In India, there are special types of bankers known as Indigenous bankers who also
carry on banking business in indigenous way. The term ‘indigenous’ means ‘local’
as distinguished from ‘foreign’. The business of these bankers is generally family
business.
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
6.Co-Operative Banks:
Co-Operative banks are financial institutions organized under the provisions of the
Co- Operative Societies act of the state concerned. To meet there financial
requirements on short term or long term basis. Such co-operative banks are based
on the principles of self- reliance and mutual co-operative.
They are essentially co-operative credit societies organized by the members. The
primary object of co-operative banks is to provide cheap and adequate credit to
their members.
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Co-Operative
A cooperative (also co-operative or co-op) is a business organization owned and
operated by a group of individuals for their mutual benefit.
Let us take one example, Suppose a poor villagers has two cows and gets ten
liters of milk. After consumption by his family everyday he finds a surplus of five
liters of milk. What can he do with the surplus? He may want to sell the milk but
may not find a customer in the village. Somebody may tell him to sell the milk in
the nearby town or city. Again he finds it difficult, as he does not have money to
go to the town to sell milk. What should he do? He is faced with a problem. Do
you have any solution for him?
One day that poor villages met a learner of NIOS who had earlier read this
lesson. The learner told him, you see, you are not the only person facing this
problems. There are many others in yours village and also in the nearby village
who face a similar problem. Why don’t you all sit together and find a solution to
your common problem? In the morning you can collect the surplus milk at a
common place and send somebody to the nearby town to sell it. Again in the
evening, you can sit together and distribute the money according to your
contribution of milk. Of course first you have to deduct all the expenses from the
sale proceeds. That villager agreed to what the learner said. He told everybody
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
about this new idea and formed a group of milk producers in his village. By selling
the milk in the nearby town they were all able to earn money. After that they did
not face any problem of finding a market form the surplus milk. This process
continued for a long time. One day somebody that instead of selling only milk why
not produces other milk products like ghee, butter, cheese, milk powder etc. and
sell them in the market at a better price? All of them agreed and did the same.
They produced quality milk products and found a very good market for their
products not only in the nearby town but in the entire country. Just think it over. A
poor villagers, who was not able to sell five liters of milk in his village, is now
selling milk and milk products throughout the nation. He is now enjoying a good
life. How did it happen? Who made it possible? This is the reward of a joint effort
or co-operation. The term co-opertion is derived from the Latin word co-operari,
where the word co means ‘with’ and operari means ‘to work’. Thus, co-operation
means working together.
So those who want to work together with some common economic objective can
form a society which is termed as “co-operative society”. It is a voluntary
association of persons who work together to promote their economic interest. It
works on the principle of self-help as well as mutual help. The main objective is to
provide support to the members. Nobody joins a cooperative society to earn
profit. People come forward as a group, pool their individual resources, utilize
them in the best possible manner, and derive some common benefit out of it. In
the above example, all producers of milk of a village joined hands, collected the
surplus milk at a common place and sold milk and milk products in the market.
This was possible because of their joint effort. Individually it would not have been
possible either to sell or produce any milk produce any milk product in that
village. They had formed a co-operative society for this purpose. In a similar way,
the consumers of a particular locality can join hands to provide goods of their
daily need and thus, form a co-operative society. Now they can buy goods directly
from the producers and sell those to members at a cheaper price.
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2. DEMOCRACY
3. SOLIDITY
Voluntary and open membership only for co-operative societies which are
working in Bijapur District only.
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Robert Owen (1771 – 1858) was a social reformer and a pioneer of the
cooperative movement. In 1761, the Fenwick Weavers’ Society was formed in
Fenwick, East Ayrshire, Scotland to sell discounted oatmeal to local workers. Its
services expanded to include assistance with savings and loans, emigration and
education. In 1810, Welsh social reformer Robert Owen, form Newtown in mid-
Wales, and his B.L.D.E.A’s A.S.P College of commerce (Autonomous), Dept of
Management, VIJAYPUR partners purchased New Lanark mill form Owen’s father-
in-law David Dale and proceeded to introduce better labour standards including
discounted retail shops where profits were passed on to his employees. Owen left
New Lanark to pursue other forms of cooperative organization and develop co-op
ideas through writing and lecture. Cooperative communities were set up in
Glasgow, Indiana and Hampshire, although ultimately unsuccessful. In 1828,
William King set up a newspaper, The Co-operator, to promote Owen’s thinking,
having already set up a co-operative store in Brighton.
2. Voluntary association
3. State control
4. Sources of Finance
5. Democratic Management
6. Service motive
8. Distribution of Surplus
Rural credit societies are found in the villages. They are associations
of the formers. They are formed for the purpose of the providing cheap credit to
the agriculturist.
These are found in the towns. They are associations of small trades
and artisans. They are organized on the basis of limited liabilities. That means a
member of urban credit societies is liable for the liabilities. That means a member
of urban credit societies is liable for the liabilities of the society only to the extent
of face value of the shares of the society held by him.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Fund for Credit Societies: The fund of primary credit society consists of
entrance fees; share Capital, reserve fund, fixed deposits from members and non-
members and loans from central co-operative banks.
The funds of co-operative bank consisted of share capital, reserves and surplus,
deposits from member and general public and loans from RBI. The government
and commercial banks. However loans and advances from RBI constituted the
major part of their funds.
The primary credit society failed to mobilize enough deposits from their
members for meeting their requirements.
They were in need of refinance from some other agency. So the co-operative
society Act 1912 provides for establishment of central co-operative banks to
provide refinance to the primary credit.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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OBJECTIVES OF BANK:
To increase the financial interest of society’s members and to motivate the
mutual co-operative.
To conduct social and educational development program for the welfare of the
society.
To provide finance for purchase of machines, vehicles etc. and advance on Gold
Ornaments to members.
Managing, selling and realizing any property, they may come into the possession
of the bank in satisfying of any of its claims.
Expand the clientele basis through our existing customers and increase the new
customer bases through our good customer services.
Branding of our existing deposit advances schemes for making them more
attractive to the customers.
Giving the loans for education and allied agriculture activities and other personal
loans.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Since from 18 years it is running in best conditions. The administration of the bank is in
the hands of board which consist of 9 directors elected from shareholders and one
female director and one from reserve quota. The bank is financing small scale industries
to lending allied to agriculturist, housing or other purposes also. The bank has played a
very proactive and dynamic role economic development in Vijaypur city. Bank enjoys an
excellent equity and good hold name in Vijaypur.
The international co-operative alliance 1925 adopted the beautiful seven colored
pattern of rainbow horizontal strips as its international fag, the flag co-operation
progress process. In this flag, the green color is related to the co-operative bank or co-
operative society.
The main intension to open this credit was to help poor people to solve their financial
problems. Through this bank they can take loan easily for any purpose. Since 9 years
society is running in profit. The Shivaji co-operative bank helps to students by giving the
prize in the form of money who is crossing more than 80% in SSLC and PUC 75% in any
degree annual exams and also they are giving prizes to sportsman, it provides 0.5% more
interest rate on deposits to its customers who as considered as senior citizens.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
COMPANY PROFILE
Name of Organization Shri Shiva maharaj co-op credit society.
Established May-1997
E-mail ID shivajibank@yahoo.com
Number of employees 16
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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BOARD OF DIRECTORS
MANAGER
MANAGER
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Introduction of Topic:-
Loans and Advances:-
The term loan refers to amount borrowed by one person from another. The
amount is the nature of lone and refers to the sum paid to the borrower. The firm form
the view point of borrower it is borrowing and from the view of bank, it is leading loan
say be regarded as ‘credit’ granted where the money is disbursed and its recovery is
made on a later date. It is a Debit for a borrower. While granting purpose and for a
predetermined period. Interest is charged on lone at agreed rate and intervals of
payment.
An advance on the other hand is a credit facility granted by bank. Banks grant
advances largely for short-term purpose, such as purchase of goods traded in and
meeting other short-term trading liabilities.
Loans mean thing cent especially sum of money to be returned with or without
interest and advance means lend or pay beforehand. It either is money lent by way of
overdraft upon a current account or by cash draft or cam is a serpent amount upon a
promising note. It include bill purchased/discounted, which is the same as making as
advance upon the security of the bills. Loans are promises for future payments from the
point of view borrower. It is the confidence felt in the future solvency of a person on
order to enable him to obtain the property of other for use as a loan. Loans and
advances granted by commercial banks are highly beneficial to individuals, firms,
companies and industrial concerns. The growth and diversification of business activities
are effected to a large extent through bank financing. Loans and advances granted by
banks help in meeting short-term and long term financial needs of business enterprises
loans and advances can be arranged from banks in keeping with the flexibility in
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business operations. Traders may borrow money for day to day financial needs availing
of the facility of cash credit, bank overdraft and discounting of hills. The amount raised
as loan may he repaid within a short period to suit the convenience of the borrower.
Thus business may be run efficiently with borrowed funds from banks for financing its
working capital requirements.
Loans and advances are utilized for making payment of current liabilities, wage and
salaries of employees, and also the tax liability of business. Loans and advances from
banks are found to be ‘economical’ for traders and businessmen, because bank charge a
reasonable rate of interest on such loans/advances. For loans from money lenders, the
rate of interest charged is very high. The interest charged by commercial banks is
regulated by the Reserve Bank of India. Banks generally do not interfere with the use,
management and control of the borrowed money. But it takes care to ensure that the
money lent is used only for business purpose.
Bank loans and advances are found to be convenient as far as its repayment is
concerned. This facilities planning for future and timely repayment of loans. Otherwise
business activities would have come to halt. Loans and advances by banks generally
carry element of secrecy with it. Banks are dutybound to maintain secrecy of their
transactions with the customers. This enhances people’s faith in the banking system.
*Loans means:
The term ‘loan’ refers to the amount borrowed by one person from another.
Commercial banks accept deposits and also lend money to the people who require it for
various purpose. Lending of funds to traders, businessmen and industrial enterprises is
one of the important activities of commercial banks.
Loan may be regarded as ‘credit’ granted where the money is disbursed and its
recovery is made on a later date. It is a debt for the borrower. While granting loans,
credit is given for a definite purpose and for a predetermined period. Interest is charged
on the loan at agreed rate and intervals of payment.
*Advance means:
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It is a ‘credit facility’ granted by the bank. Banks grant advances largely for short-term
purposes, such as purchase of goods traded in and meeting other short-term trading
liabilities. There is a sense of debt in loan, whereas an advance is a facility being availed
of by the borrower. However, like loans, whereas an advance are also to be repaid. Thus
a credit facility-repayable in installments over a period is termed as loan while a credit
facility repayable within one year may be known as advances. However, in the present
seances these two terms are used interchangeably.
People make their funds available to the banks by depositing their ‘savings’ in
various types of accounts. On public deposits the banks pay interest at and the
rate of interest varies according to the type of deposit.
The bank- borrowing rate refers to the rate of interest paid by a bank on its
deposits.
When the Reserve Bank of India lends money to commercial banks, the rate of
interest is charges for lending is known as ‘Bank Rate’.
The rate at which commercial banks make funds available to people known as
‘Lending-rate’.
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PIGMY
1 year above and below two year 3.50%
2) SAVINGS ACCOUNT:
Photo copies of account holder
3) FIXED DEPOSIT:
Filling the appropriate application from of the urban bank.
4) RECURRING DEPOSIT:
Proof for name, address and residence
1) Time of maturity:
Time of maturity describes the length of the loan contract loans are classified according
to their maturity into short term debt, intermediate-term debt, and long term debt
revolving credit and perpetual debt have no fixed date for retirement. Banks provide
revolving credit through extension of a line of credit. Brokerage firms supply margin
credit for qualified customers on certain securities in these cases, the borrower,
constantly turns over the line of credit paying it down and reborrowing the funds
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needed. A perceptual loans requires only regular interest payments. The borrower, who
usually issued such debt through a registered offering, determines the timing if the debt
retirement.
2) Repayment scheduled:
Payments may be required at the end of contract or at set intervals, usually on a
monthly or semiannual basis. The payment is generally comprised of two parts: a
portion of the outstanding principal and the interests costs. With the passage of time,
the principal amount of the loan is amortized, or repaid little by little until it is
completely retired. As the principal balance diminishes, the interest on the remaining
balance also declines. Interest only loans do not pay down the principal. The borrower
pays interest on the principal loan amount and is expected to retire the principal at the
end of the contract through a balloon payment or through refinancing.
3) Interest:
Interest in the cost of borrowing money. The interest rate charged by lending
institutions must be sufficient to cover operating costs, administrative costs, and an
acceptable rate of return. Interest rate may be fixed for the term of the loan, or adjust to
reflect changing market condition. A credit contract may adjust rates daily, annually, or
at intervals of 3, 5 and 10 years. Floating rates are tied to some market index and are
adjust regularly.
4) Security:
Assets pledged as security against loan loss are known as collateral. Credit backed by
collateral is secured. In many cases, the assets purchased by the loan often serves as the
only collateral. In other cases the borrower puts other assets, including cash, aside as
collateral. Real estate or land collateralizes mortgages. Unsecured debt relies on the
earning power of the borrower.
The lending rates also vary depending upon the nature of loans and advances. The rates
also vary according to the purpose in view. For example if the loan is sanctioned for the
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purpose of activities for the development of the backward areas, the rate of interest is
relatively lower as against loans and advances for commercial business purposes.
Similarly for smaller amounts of loan the rate of interest is higher as compared to larger
amounts. Again lending rates for consumer durables, e.g. loan for purchase of two-
wheelers, cars, refrigerators, etc. are relatively higher than for commercial borrowings.
Lower rate of interest is charged for loans granted to persons belonging to ‘weaker
sections of the society’. And agriculture propose.
a) Direct loans,
b) Cash credit,
c) Overdraft,
d) Discounting of bills.
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Borrower can be a housing under taking housing projects or housing schemes for
economically weaker section (EWS), low income group (LIG) and middle income
group (MIG).
To decrease the credit risk, bank should avoid concentration of advance in the hands of
few borrowers and in specified activities. RBI has prescribed prudential exposure norm
which at present stipulated that maximum exposure to a single borrower should not
exceed 15% of capital funds and that to a group of borrowers not to exceed 40% of
capital include.
Paid up capital
Building fund
2) Interest rates:-
Banks may with the approval of their boards, determine the rate of interest keeping in
view the size of accommodation degree of risk.
The bank can charge a penal interest with the approval of the board. Here the
board must be very transpiring, fairness while fixing penal interest. This penal
interest is of 2% at the bank and is levied for default repayment.
4) Security:
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By both
Even bank may accept security of adequate value in the form of LIC polices, government
promissory notes, shares, gold ornaments or those security which been appropriate.
5) Disbursement of loan:
In order to reach the loan amount to the specified purpose of construction of house, the
banks have to disburse the housing loan into four equal installments. This is not due by
the bank the borrower may miss-utilize the projected plan or he may simple extend his
budget or plan of the house which may result the borrower defaulter to the bank in
repayment of his installments.
The four equal installments while disbursing the housing loan are;
Loan purpose is a term in United States mortgage industry to show the underlying
reason an applicant is seeking a loan. The purpose of the loan is used by the lender to
make decisions on the risk and may even impact the interest rate that is offered. It
seems that not everybody could live luxuriously and we should be thankful that financial
institutions are aware of that. So, here are the top 10 reasons and purposes for a loan.
1) Business launching:
A few other businesses are capital intensive whereas others are labor intensive.
Whenever a business tumbles down into previous category, there will be a huge need
for loan application.
2) House buying:
It’s going to be a very huge expense for sure including the house’s initial cost and the
furniture. Thus, we tend to settle for a loan.
3) Home improvement:
Not everybody has a well planned house from the start. Some just built a house from
the scratch out of very affordable materials but could easily damage. After so many
years, roof might need to be fixed and some other parts of the house. In that case,
there’s a need for a loan application.
4) Investments:
The costs of property these days are enormously soaring and there may be no better
technique to maximize the level of investment you might have a compared with buying
certain property and assets. Wait around for the value to increase and after that sell it
what could possibly be easier ? Ending up with a loan intended for this specific purpose
is the most sensible thing that can be done in life.
Should a business has to turn out or perhaps an individual fails to know the right way to
deal with his finances, then he will probably get into financial obligation. It’s good to
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known that there exists a particular loan which one can find solely for this particular
purpose which is, to guide you get rid of the financial chaos. One particular loan is
known as Debt consolidation Loan that you can utilize to incorporate the varied debt
costs and settle everything off all at once.
6) Education
Universities these days offer student loans making it easier so they can manage to pay
for their educational costs and in many cases insure living expenses as well. The student
has to provide evidence that he or she doesn’t have sufficient funding before applying
for this particular loan. The good thing there is that rates of interest are certainly not
overly high. Due to the fact that this loan is marginally not the same as the others, it is
good idea that you go over the whole process before you apply.
7) Emergency expenditure:
Many people don’t hold heath care insurance or struggle to repay all of their living
expenses by the end of the month, have a tendency to make application for loans.
Nevertheless, just be sure to pay off the mandatory time frame to protect yourself from
a serious uncertainly.
8) Car buying:
One of the hardest things to achieve today is buying a car. But people who are in need of
car and can afford the monthly amortization, car loan is available.
9) Weddings:
All brides would like to have the best wedding but then the sad thing there is, best
incorporate expensive. Even so, a lot of couples find that it’s totally typical for it to cost
enormous costs of money to get one sole party and in case they don’t get that sort of
funding they can always apply for a loan. They might usually take one more to finance
the ideal honeymoon in the process.
10) Travel:
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This will likely not at all make sense that much, however some floks get a loan to actually
finance a holiday vacation. A necessity could also come when loss of life happens in
faraway face and one doesn’t even have sufficient funds to pay for the entire expenses.
Consumer and small businesses obtain loans with varying maturity periods to fund
purchase of real estate, transportation, equipment, supplies and a vast array of other
needs.
SHORT-TERM LOANS:
A special commitment loan is a single purpose loan with a maturity of less than one year.
It’s purpose is to cover cash shortages resulting from a onetime increase in current
assets, such as a special inventor purchase, an unexpected increase in accounts
receivables, or a need for interim financing. Trade credit is another type of short term
loan. It is extended by a vendor who allows the purchase up to three months to settle a
bill. In the past it was common practice for vendors to discount trade bill by one or two
percentage points as an incentive for quick payment.
A seasonal line of credit of less than one year may be used to finance inventory
purchases or production. The successful sale of inventory repays the line of credit. A
permanent working capital loan provides a business with financing from one to five year
during times when cash flow from earnings does not coincide with timing or volume of
expenditures. Creditors expect future earnings to be sufficient to retire the loan.
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Term loans finance the purchase of furniture, fixture, vehicles, and plant and office
equipment. Maturity generally runs more than one year but less than five. Consumer
loans for autos, boats, and home repairs and remodeling are also of intermediate term.
Mortgage loans are used to purchase real estate and are secured by the asset itself.
Mortgages generally run between ten and forty years. A bond is a contract held in trust
with the obligations of repayment.
1) Overdraft loan
2) Gold loan
7) Mortgage loan
8) Surety loan
9) Housing loan
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Chapter – 3
Objectives of the study
Methodology
OBJECTIVES:-
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The major objective of the study is to known about financial strengths and weakness of
Shri. Shivaji Maharaj co-operative Bank through Financial loans and advances.
3. To evaluate and analyze various facts of the financial performance of the bank.
4. To make comparisons between during the loan and advances different period.
B.METHODOLOGY:
The information is collected through secondary sources during the project. That
information was utilized for calculating performance evaluation and based on that,
interpretations were made.
1. Most of the calculations are made on the financial statements of the bank
provided statements.
2. Referring standard texts and referred books collected some of the information
regarding theoretical aspects.
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3. The study is also beneficial to employees and offers motivation by showing how
actively they are contributing for company’s growth.
LIMITATIONS:
The study provides as insight into the financial and other aspects. Every study will be
bound with certain limitations.
One of the factors of the study was lack of availability of sample information. Most of
the information has been kept confidential and as such as not asset as art of policy of
company. Time is an important limitations. The whole study was conducted in a period
of 60 days, which is sufficient to carry out proper interpretation and analysis.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Table No.3.1
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Graph No.3.1:
Interpretation:
From the above graph, it is clear evident that during the 2013-14 Mortgage, housing and
Hypothecation on Machinery Loan occupies major portion. i.e., 49.81%, 19.36% and
9.18% and remaining loans are negligible.
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Table No.3.2
Amount Percentage(%)
Mortgage Loan 12,69,51,536 52.36
Housing Loan 4,53,73,619 18.71
Hyp. On Machinery Loan 1,99,02,389 8.21
Surety Loan 1,46,92,517 6.1
Gold Loan 1,05,29,225 4.34
Adv.Cha.S.M.C.C. 60,78,885 2.51
Cash Credit Loan 56,77,545 2.34
Other Loan 1,32,62,238 5.47
Total 24,24,67,954 100.00
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Graph No.3.2
Interpretation:
From the above graph, it is clear evident that during the 2014-15 mortgage, Housing and
Hypothecation on Machinery Loan occupies major portion. i.e. 52.36%, 18.71% and
8.21% and remaining loans are negligible.
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Table No.3.3
Amount Percentage(%)
Mortgage Loan 17,42,21,971 55.88
Housing Loan 5,87,87,946 18.86
Hyp. On Machinery Loan 2,20,94,284 7.09
Surety Loan 1,16,14,737 3.8
Gold Loan 1,67,70,624 5.39
Adv.Cha.S.M.C.C 92,02,982 2.95
Cash Credit Loan 83,28,912 2.67
Other Loan 1,07,32,776 3.45
Total 31,17,54,232 100.00
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Interpretation:
From the above graph, it is clear evident that during the 2015-16 Mortgage, Housing and
Hypothecation on Machinery loan occupies major portion. i.e., 55.88%, 18.86% and
8.09% and remaining loans are negligible.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Table No.3.4
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SHRI SHIVAJI MAHARAJ CREDIT CO-OPERATIVE SOCIETY, VIJAYPUR
Interpretation:
From the above graph, it is clear evident that during the 2016-17 Mortgage, Housing and
Hypothecation on Machinery loan occupies major portion. i.e., 55.90%, 23.18% and
6.24% and remaining loans are negligible.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Interpretation:
From the above graph, it is clear evident that during the 2017-18 Mortgage, Housing and
Hypothecation on Machinery loan occupies major portion. i.e., 58.44%, 23.88% and
5.42% and remaining loans are negligible.
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3.6) Analysis of percentage(%) of total mortgage loans and total loans and advances
Interpretation:-
From the graph above, it is clear that mortgage of the bank. In the year 2014, it was
49.81, in year 2015 it got increased to 52.36, in year 2016 it again increased to 55.88, in
year 2017 it was almost same as last year i.e. 55.9, in year 2018 it got increased to 58.44.
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B.L.D.E.A’s A.S.P College of Commerce (Autonomous), Dept of Management, VIJAYPUR
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Interpretation:
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From the graph above comparison of loans and advances in Total Assets, it is keenly
observed that against of Rs. 100 assets bank’s loans and advances occupies Rs. 75 i.e.,
75.42 during 2017-18.
Graph N0.3.8
Interpretation:
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From the above graph, it is clear evident that interest earned and received is remains
stable during the study period. i.e., average 10.34%.
Year Members
2013-14 4,330
2014-15 4,422
2015-16 4,562
2016-17 4,669
2017-18 4,786
Graph no: 3.9
Interpretation: From the graph above, it is clear that growth of members is very
impressive. i.e., 762 members in the first year and it has to increased year by year. At
present total members are 478.6 during year 2017-18. (21 th year)
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Chapter -4
Findings
Suggestion
Conclusion
Findings:-
The bank’s mortgage amounts is increasing year by year
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From the study of banks data the 1st year housing loans is in good condition and
2nd year it got decreased and next 3 year it got increased continuously
The banks total loans, advances and total deposit are changed in previous 5 years.
For first two year it is decreased and in year 2016 it reached up to 100%. In year
2017 and 2018 it again got decreased.
The comparison of interest earned and, loans and advances got increased for first
two years and again it got decreased in 2016 and again increased in next two
years.
The bank is in good position and getting new members every year.
Suggestation:-
o Since housing loans are increasing from last 3 years, the bank may reduce their
interest rates so that it can increase the number of customers
o Interest earned on loans and advances is found to be decreasing so the bank need
to take care on this part
o Bank should look to open new branches with proper planning and careful
selection of the location, which is convenient to the target customers especially in
places where there are a lot of option in front of the consumers.
o The efficiency of the bank is well but still they need to increase their efficiency to
increase their revenue.
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Conclusion:-
As we observed the trends in Indian financial sector is changing rapidly through
Innovation and dependability of loans and advances has also increased and much
awareness of this concept has been found. Loans and advances have been become an
important source of raising the finance amongst individual, corporate as well as for the
higher organizations. More training, computerization, data collection, market analysis
and swiftness in servicing are essentially required.
The competition among the banks cannot be neglected. They have been supplying loans
for the purpose of purchase of vehicles, pursue of higher education, or to meet their
other personal requirements.
The duration of the project would be of two months. I have studied loans and advances
of the bank and I have recommended some suggestions for the better efficiency of the
bank.
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Bibliography
Vijayapur, S.S. (2017-18). Annual Report and Balance Sheet. Vijayapur
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TABLE OF CONTENTS
SL.NO. CONTENTS
Introduction
History
Objectives
scope
02. Company Analysis
Company Profile
Board of directors
organization Chart
03. Department Profile
06. Bibliography
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