INDEX

Chapter Name of the Topic Page

No. No.
1. Introduction & Research 1-5
Design
2. Theoretical Background 6-35
3. Organization Profile 36-41
4. Data Analysis & 42-60
Interpretation
5. Findings, Conclusions & 60-64
Recommendations
Bibliography 65
Annexure 66
 Chapter 1:

Introduction

Research Design

1. INTRODUCTION:
A strong Credit Societying sector is important for flourishing economy.
One of the most important and major roles played by Credit Societying sector is that of
leading business. Granting of credit for economic activities is the prime duty of Credit
Societying. As there are pros and cons of everything the same is with the lending business
that carries credit risk which arises from the failure of the borrower to fulfill its contractual
obligations. Lending is generally encouraged because it has the effect of funds being
transferred from the system to productive purposes, which results into economic growth. Non
recovery of loans with interest forms a major hurdle in the process of credit cycle.

The magnitude of NPA has direct impact on Credit Societys profitability. Thus: these
loans losses affect the Credit Society’s profitability on a large scale. Though complete
elimination of such losses is not possible, but Credit Societys can always aim to keep the
losses at a low level. Nonperforming Asset (NPA) has emerged since over a decade as an
alarming threat to the Credit Societying industry in our country sending distressing signals on
the sustainability and educability of the affected Credit Societys. Despite various correctional
steps administered to solve and end this problem, concrete results are eluding. The NPA level
of our Credit Societys is way high than international standards. One cannot ignore the fact
that a part of reduction in NPA is due to writing off bad loans by. Indian Credit Societys take
maximum care to ensure that they give loans to credit worthy customers. In this context the
dictum preventions is always better than cure acts as the golden rule to reduce NPAs.
1.2 OBJECTIVES OF THE STUDY:-
1. To understand the concept Non- performing Asset.
2. To know what are the norms adopted by Credit Society to look after NPA
management.
3. To understand the impact of NPA on Credit Societys profitability.
4. To know what steps are being taken by Credit Societying sectors to reduce NPAs
5. To give suggestions if any.

1.3 HYPOTHESIS:-
Ho: There is no impact of NPAs on profitability of Credit Society.

Hr: There is an impact of NPAs on profitability of Credit Society.

1.4 IMPORTANCE OF STUDY:-

The rationale behind this study is to analyses what kind of role NPAs are playing upon the
operations of the Credit Society. Recently most of the Credit Society’s was merging into
other Credit Societys. One of reason behind is that improper recovery policy of Credit
Society. Hence there is need to study SPA management of Credit Society & to know
variables available to control NPAs.

1.5 RESEARCH METHODOLOGY:-

Sources of Data:-

To fulfil the objective of study of Nonperforming Asset, the researcher collected the primary
& secondary data.
Primary Data:-

Primary data is data which is collected afresh and for the first time and thus happens to
be original in character is Primary data.

Primary data is the first hand information to study this topic. It was collected through
observation, personal discussion in the light of set of objective. Primary data was collected
form following Sources:-

c) Observation

d) Discussion

Secondary Data:

Data that is not originally collected but rather obtained from published or unpublished
source is known as secondary data. Secondary data was collected with the help of following
Sources:-

7. Annual Report of Credit Society

8. Master circular of CO OP COMMISSIONER ACT

9. Website/ internet

10. Reference Book

11. Magazine

12. Record and document of the Credit Society

Tools & Techniques: - Statistical Tools like Ratio analysis and Trend analysis were used for
data analysis purpose.

Sample Size: 3 Year.

1.6 SCOPE OF STUDY:-

Area scope:

The study is related to the financial composition of Head office of the KARMAVEER
BHAURAO PATIL NAGARI SAH. PATSANSTHA MARYA. SANGLI

Subject scope:

The Researcher came to know about the NPA position of the KARMAVEER
BHAURAO PATIL NAGARI SAH PATSANSTHA MARYA. SANGLI

for last five year.

1.7 LIMITATIONS OF THE STUDY:-

1. The time period given for the study was limited

2. This study is only limited to the Head office of KARMAVEER BHAURAO PATIL
NAGARI SAH PATSANSTHA MARYA. SANGLI

3. As the certain documents were confidential, it was not possible to collect the information
necessary for the deep study.

1.8 EXPECTED CONTRIBUTION:-

This research work covered study of Non-Performing Assets and what are the
underlying reasons for emergence of the NPAs. This study will also help in comparing
performance of Credit Society with others. This study will also put some upon impact of
NPAs.
Chapter 2 :
Theoretical
Background
2.1 Introduction:-Non Perforuning Asset (NPAs)

Action for enforcement of security interest con be initiated only if the secured
osset is classified as Non-Performing Asset. Non-Performing Asset means nn asset or
account of borrower, which has been classified by a Credit Society or financial institution os
sub-standard, doubtful or loss asset, in accordance with the directions or guidelines relating
to asset classification issued by CO OP COMMISSIONER ACT. An amount due under any
credit facility is treated as "past due" when it has not been paid within 30 days from the due
date. Due to the improvement in the payment and settlement systems, recovery climate, up
gradation of technology in the Credit Societying system, etc., it was decided to dispense with
'past due' concept, with effect from March 31, 2001. Accordingly, as from that date, a Non
performing asset (NPA) shell be an advance where interest and /or instalment of principal
remain overdue for a period of more than 180 days in respect of a Term Loan, the account
remains 'out of order' for a period of more than 180 days, in respect of an overdraft/ cash
Credit(OD/CC), the bill remains overdue for a period of more than 180 days in the case of
bills purchased and discounted, interest and/ or instalment of principal remains overdue for
two harvest seasons but for a period not exceeding two half years in the case of an advance
granted for agricultural purpose, and any amount to be received remains overdue for a period
of more than 180 days in respect of other accounts.

With a view to moving towards international best practices and to ensure greater
Transparency, it has been decided to adopt the '90 days overdue' norm for
identification of NPAs, form the year ending March 31, 2004. Accordingly, with
effect from March 31, 2004, a non Performing asset (NPA) shell be a loan or an
advance where; interest and /or instalment of Principal remain overdue for a period of
more than 90 days in respect of a Term Loan, the account remains 'out of order' for a
period of more than 90 days, in respect of an overdraft/ cash
credit (OD/CC), the bill remains overdue for a period of more than 90 days in the case
Of bills purchased and discounted, interest and/ or instalment of principal remains
overdue for two harvest seasons but for a period not exceeding two half years in the case
of an advance granted for agricultural purpose, and any amount to be received remains
overdue for a period of more than 90 days in respect of other accounts.

2.2Operational Concepts & Definitions:

1. CREDIT SOCIETY RATE:

It is the rate at which the CO OP COMMISSIONER ACT lends to other commercial

Credit Societys. It is the rate at which the CO OP COMMISSIONER ACT rediscounts
the bill of exchange. It acts as a signal to the economy on the monetary policy.

2. CREDIT SOCIETY CREDIT:

The credit extended by Credit Societys to its customers.

3. NON-PERFORMING ASSETS:

NPA is a loan (whether term loan, cash credit, overdraft or bills discounted) which is in
default for more than three months. In case of such assets, the income should be shown
on receipt basis in Credit Society's books and not on due basis.

4. GROSS NON-PERFORMING ASSETS:

Credit Society even after making provisions for the advances considered irrecoverable,
continued to hold such advances in their books is termed as GNPA.
 5. NET NON-PERFORMING ASSETS:

Net non-performing assets are gross NPAs less provision made in the accounts, balance in
interest suspense account, claims received from DICGC, and amounts received in
compromise.

6. CASH RESERVE RATIO (CRR):

Every commercial Credit Society is required to keep a certain percentage of its demand and
time liabilities (deposits) with CO OP COMMISSIONER ACT (either as cash or book
balance), CO OP COMMISSIONER ACT is empowered to fix the CRR between 3% and
15%.

7. STATUTORY LIQUIDITY RATIO (SLR):

Commercial Credit Societys are also required to keep (in addition to CRR) liquid assets in
the shape of cash, gold or approved securities as a certain percentage of their net demand and
time liabilities (NDTL).

8. CAPITAL ADEQUACY RATIO (CAR):

Credit Societys are required to maintain a minimum capital to risk assets ratio, which helps
the Credit Society to survive even during sub stainable losses. (To ensure good
performance, CO OP COMMISSIONER ACT has specified minimum adequate capital for
Credit Societys).

9. CAMELS:

As per the recommendation of working groups set up by CO OP COMMISSIONER

ACT on ‘supervision of Credit Societys’ a new approach has been adopted in the
annual financial inspection of Credit Societys.
It evaluates Credit Societys —

CAPITAL ADEQUACY

ASSET QUALITY
MANAGEMENT
EARNINGS
LIQUIDITY
SYSTEM AND
CONTROL.

10. RETURN ON ASSETS (RAO):

This is profit after tax as percentage of average total assets of average total assets of
current and previous year. Total assets are taken net of revaluation, advance tax, and
miscellaneous expenditure to the extent not written off.

11. RETURN ON INVESTMENTS (ROD:

This is ratio of interest and dividend income earned as percentage of average

instruments of current and previous year. Interest earned considered here excludes
interest earned on advances.

12. Out Of Order Status

An account should be treated as 'out of order' if the outstanding balance remains continuously
in excess of the sanctioned limit/drawing power. In cases where the outstanding balance in
the principal operating account is less than the sanctioned limit/drawing power, but there are
no credits continuously for 90 days as on the Date of Balance Sheet or credits are not enough
to cover the interest debited during the same period, these accounts should be treated as 'out
of order'
 13. Overdue
Any amount due to the Credit Society under any credit facility is 'overdue' if it is not paid
on the due date fixed by the Credit Society.

14. Income Recognition Policy

The policy of income recognition has to be objective and based on the record of recovery.
Internationally income from nonperforming assets (NPA) is not recognized on accrual
basis but is booked as income only when it is actually received. Therefore, the Credit
Societys should not charge and take to income account interest on any NPA.

However, interest on advances against term deposits, NSCs, IVPs, KVPs and Life policies
may be taken to income account on the due date, provided adequate margin is available in
the accounts. Fees and commissions earned by the Credit Societys as a result of
renegotiations or rescheduling of outstanding debts should be recognized on an accrual
basis over the period of time covered by the renegotiated or rescheduled extension of
credit

If Government guaranteed advances become NPA, the interest on such advances should not
be taken to income account unless the interest has been realized.

15. Reversal Income

If any advance, including bills purchased and discounted, becomes NPA, the entire
interest accrued and credited to income account in the past periods, should be reversed if
the same is not realized. This will apply to Government guaranteed accounts also.

In respect of NPAs, fees, commission and similar income that have accrued should cease
to accrue in the current period and should be reversed with respect to past periods, if
uncollected. The finance charge component of finance income [as defined in 'AS 19
Leases' issued by the Council Of the

Institute of Chartered Accountants of India (ICAI)] on the leased asset which has accrued
and was credited to income account before the asset became nonperforming, and
remaining

Unrealized, should be reversed or provided for in the current accounting period

2.3 Asset Classification

Credit Societys are required to classify nonperforming assets further into the following
categories based on the period for which the asset has remained nonperforming and the
reliability of the dues:

1. Standard Assets:

Standard assets are absolutely good assets. This is one which does not disclose any
problem and which does not carry more than normal risk. All the agricultural and non-
agricultural loans which have not become nonperforming assets may be treated as
standard asset of cooperative Credit Societys/ other Credit Societys.

2. Sub Standard Assets:

An asset which has remained overdue for a period not exceeding 3 years in respect of both
agricultural and non-agricultural loans should be treated as sub-standard. In case of all
types of term loans, where instalments are overdue for a period not exceeding 3 years, the
entire outstanding in term loan should be treated as sub-standard. An asset, where the
terms and conditions of the loans regarding payment of interest and repayment of principal
have been renegotiated or rescheduled, after commencement of production, should be
classified as substandard and should remain so in such category for at least one year of
satisfactory performance under the renegotiated or rescheduled terms. In other words, the
classification of an asset should not be upgraded merely as a result of

Rescheduling, unless there is satisfactory performance. In case Of commercial Credit

Societys, w. e. f. 2005, a substandard asset is one, which has remained NPA for a period
less than or equal to 12 months.
 3. Doubtful Asset:

As asset which has remained overdue for a period exceeding 3 years, in respect of both
agricultural and non-agricultural loans, should be treated as doubtful. In case of all types
of term loans, where instalments are overdue for more than 3 years, the entire outstanding
in term loan should be treated as doubtful. As in the case of sub-standard assets,
rescheduling does not entitle a Credit Society to upgrade the quality of advance
automatically. Doubtful has further three categories DI, D2 and D3. Doubtful 1 is asset
which is overdue more than 36 months to 48 months. Doubtful 2 is asset which is overdue
for more than 48 months to 72 months. Doubtful 3 is asset which is overdue for more than
72 months. Asset straightaway be classified as doubtful, in case of serious credit
impairment as assessed by the Credit Society/ auditors/ CO OP COMMISSIONER ACT/
NABARD i.e. realizable value of the security is less than 50%. In case of commercial
Credit Societys, w. e. f. March, 2005, an asset is classified as doubtful if it has remained in
the substandard category for a period of 12 months.

4. Loss Assets:

Loss assets are those where loss is identified by Credit Society/auditor/CO OP

COMMISSIONER ACT/NABARD inspectors but the amount has not been written off
wholly or partly. In other words, an asset which is considered unrealizable and/or of such
little value that its continuance as a doubtful asset is not worthwhile,

Should be treated as a loss asset. Where decrees or execution petitions have been time barred
or documents are lost or no other legal proof is available to claim the debt, at that time asset
is classified as loss asset. Where the members and their sureties are declared insolvent or
have died Leaving no tangible assets, where borrowers have left the area of operation leaving
no property and Sureties of such loan have also no means to pay the dues, at that time asset is
classified as loss asset. Asset straightaway be classified as loss if realizable value of the
security is less than 10%, as assessed by the Credit Society/ auditors/ CO OP
COMMISSIONER ACT/ NABARD.
 2.4 Causes for an Account Becomin NPA:

Causes Attributable to Borrower

1. Failure to bring in required capital

2. Too ambitious project

3. Longer gestation period

4. Unwanted expenses

5. Over trading

6. Imbalances of inventories

7. Lack of proper planning

8. Dependence on single customer

9. Lack of proper planning

10. Improper working capital management

I l. Mismanagement

12. Diversion of funds

13. Poor quality management

14. Heavy outside borrowings

15. Poor credit collections

16. Lack of quality control

Causes attributable to Credit Society

1. Imbalances of inventories

2. Lack of proper planning

3. Dependence on single customer

4. Lack of expertise

5. Improper working capital management

6. Mismanagement

7. Diversion of funds

8. Poor quality management

9. Heavy outside borrowings

10. Poor credit collections

11. Lack of quality control

12. Lack of infrastructure

Other causes

1. Fast changing technology

2. Unhelpful attitude of the govt.

3. Changes in consumer preferences.

4. Increase in material cost

5. Government policies

6. Credit policies

7. Taxation laws

8. Civil disturbances

9. Political hostility

10. External pressure

11. Sluggish Legal System

 2.5 Impact of NPAs on Performance of Credit Society:

The efficiency of a Credit Society is not reflected only by the size of its balance sheet but
also the level of return on its assets. The NPAs do not generate interest income for Credit
Societys but at the same time Credit Societys are required to provide provisions for
NPAs from their current profits. The NPAs have deleterious impacts in following ways

On Profitability:-

NPA means booking of money in terms of bad asset, which occurred due to wrong choice
of client. Because of the money getting blocked the profitability of Credit Society decreases
not only by the amount of NPA but NPA lead to opportunity cost also as that much to profit
invested in some return earning project/asset . So NPA doesn't affect current profit but also
future stream of profit, which may lead to loss of some long-term beneficial opportunity.
Another impact of reduction in Profitability is low ROI (return on investment), which
adversely affect current earning of Credit Society.

On Liquidity:

Money is getting blocked, decreased profit lead to lack of enough cash at hand which lead
to borrowing money for shot rates period of time which lead to additional cost to the
company. Difficulty in operating the function of Credit Society is another cause of NPA
due to lack of money.
On Return on Assets:

The interest income of Credit Societys will fall and it is to be accounted only on receipt
basis. Credit Societys profitability is affected adversely because of the providing of
doubtful debts and consequent to writing it off as bad debts. Return on investments (ROI)
is reduced. The capital adequacy ratio is disturbed as NPAs are entering into its
calculation. The cost of capital will go up. The assets and liability mismatch will widen.

Involvement of management

Time and effort of management is another indirect cost which Credit Society has to bear
due to NPA. Time and effort of management in handling and managing NPA would have
diverted to some fruitful activities, which would have given goods returns. Now day’s
Credit Societys have special employees to deal and handle NPAs, which is additional cost
to the Credit Society.

Credit loss

Credit Society is facing problem of NPA then it adversely affect the value of Credit
Society in terms of market credit. It will lose it goodwill and brand image and credit which
have negative impact to the people who are putting their money in the Credit Societys.
 2.6 Earl S m toms: B which one can reco nize A erformin asset turnin in to Non-
erformin Asset:
1. Financial:

 Non – payment of the very first instalment in case of term loan.

 Bouncing of cheque due to insufficient balance in the accounts.
 Irregularity of operations in the accounts.
 Unpaid overdue bills.
 Declining Current Ratio.
 Payment which does not cover the interest and principal amount of that instalment.

 While monitoring the accounts it is found that partial amount is diverted to sister
concern or parent company.

2. Operational and physical:

 If information is received that the borrower that the borrower has either initiated the
process of winding up or are not doing the business.
 Overdue receivables.
 Stock statement not submitted on time.
 External non-controllable factor like natural calamities in the city where borrower
conduct his business.
 Frequent changes in plan.
 Nonpayment of wages.
3. Attitude Chan es:
Use for personal comfort, stocks and shares by borrower.
Avoidance of contact with Credit Society.
 Problem between partners.

4. Others:
 Changes in Government policies.
 Death of borrower.
 Competition in the market.

2.7 Management of NPAs

The new concepts of income recognition, asset classification and provisioning have been
introduced in phases with effect from 1992-93. The impact of implementation of these
prudential guidelines on the commercial Credit Societys has been so strong that out of 20
nationalized Credit Societys, one had to be merged and out of the remaining 19 Credit
Societys excepting 6, all others were in red, showing net losses aggregating to a staggering
level of 3573.13 crores. In March 1993 and still a higher level of RS•4705.01 crores in
March 1994. Further, due to staggering net loss revealed by the Indian Credit Society, the
aggregate net loss of the 19 nationalized Credit Societys even in march 1996 was Rs.
1153.96 crores. However the aggregate net profit of 19 nationalized Credit Societys, as on
March 1997 was Rs.1445.48 crores.

()cohjic chonge oc profitability scenario of Credit Societys in India since 2005-05 was
mainly due to

Recognition of' intone based on record of recovery rather than on accrual basis, due to ion
oc new prudential norms.
 Management of NPAs would have the following objectives:-

 I GU proving the quality On NPAs to the performing status so that income of such
assets could be recognized.
 Upgrading the status of the asset so as to provisioning requirement.
 Cleansing the balance sheet of Credit Society and also of unsecured portion of
doubtful assets, ultimately leading to improvement in the capital adequacy ratio of
the Credit Society.

2.7.1 RECOVERY POLICY

AJ Follow Up Of irregular/ Overdue/ NPA advances

Loans and advances become irregular due to non-payment of instalment and/ or/ interest.
Such accounts turn NJ A if timely care is not taken for their recovery. To avoiding the
accounts turning Steps are required to be taken immediately on an account becoming
technically irregular.

Jn caw of term loans if two monthly, one quarterly, one half yearly or annually installment in
unpaid the borrower be personally contacted and a notice demanding the due instalments be
il’’used simultaneously.

2. After the personal contact & giving notice, if the account is not regularized then steps be
n for taking possession of the securities for the loan.

3. After that the account is not regularized and it is turned NPA, the documents of such loan
3. Accounts be examined and discrepancies therein if any got rectified. Acknowledgement of
debt is obtained from the borrower and the guarantor. The securities for the loan facility are
taken into possession.
 4. If no desired response is received by borrower and guarantor, a legal notice is issued to
the borrower and guarantor in six months from the date of identification of the account as
NPA with prior approval of the Head Office.
5. Borrowers which are depends upon agriculture may be allowed to pay the over dues in
their cropping pattern and harvesting season. Such a rescheduled be got approved from
Head Office.

6. Only considering the genuine reasons of borrowers and suppose he is ready to pay the
outstanding in one lump sum if the penal interest is waived, his request may be considered
sympathetically and the panel interest is waived.
The statement showing position of NPA's for the quarter ending March every year are
received at Head Office immediately after the financial year is over. Such statements be
thoroughly scrutinized and be consolidated. Based on these figures targets for recovery be
fixed in consultation with the Branch Managers.

[B I Control over irregular advances

In case installment and interest of term loans and cash credit have remained unpaid from
specific Period of time, then it is known as irregular account. Irregular account should
report to Head office by branches on monthly basis in a prescribed form. These accounts
are classified in four categories as per the norms of CO OP COMMISSIONER ACT. The
position of recovery in NPA accounts be called from branches on monthly basis and the
position of recovery be placed before the Board of Directors on monthly basis. Recoveries
affected in doubtful and loss assets are first appropriated towards principle.
 [C I Collection dues and security repossession policy

The policy of dues collection of the Credit Society is built around dignity and respect
to customers. Credit Society will not follow policies that are unduly coercive in
collection of dues. The policy is built on Courtesy, fail treatment and persuasion.

All the members of the staff or any person authorized to represent Credit Society, in
collection or/and security repossession would follow the guidelines set out below:

• The staff of Credit Society or any authorized person would be contacted with customer
at the place of borrower's choice.

• The Credit Society communicates in simple language with borrowers and takes privacy.

• All assistance will be given to resolve disputes or differences regarding dues in a

mutually acceptable and in an orderly manner.

Following STEP are the steps involved in collection of dues & security repossession
policy.
i. Giving Notice to borrowers.

The Credit Society will not give legal notice to the borrowers at first time. First notice
will sent to borrowers

With details of amount in default will give 15 days' time period for borrower to regular
the account. Suppose the borrower fails to respond then second notice will issued
would be given a further Period 15days to clear dues. After that borrower failure to
respond within the time period, a final notice will be issued. Credit Society will follow
all such procedures as required under law for recovery/repossession of security.
 ii. Repossession of Security.

In repossession of security will involve repossession, valuation of security and

realization of security through appropriate means. Repossession will be done only after
issuing the final and third notice as detailed above.

iii. Valuation and Sale of Property.

The Credit Society will have right to recover from the borrower the balance due if
any, after sale of property. Excess amount if any, obtained on sale of property will
be returned to the borrower after meeting all the related expenses provided the
Credit Society is not having any other claims against the customer.
iv. Opportunity for the borrower to take back the security.
Credit Society give opportunity for borrower to take back the security after
convinced of the arrangements made by the borrower to ensure timely repayment of
remaining instalments in future.

D) Norms in respect of filing of suits: Following norms to be observed

before filing of a suit:

Suit is filled through an Advocate on the Credit Society’s panel only. When making of all
efforts such as personal contact, demand notice etc. if there is no response from borrowers,
then a suit should be filed. First final notice through Credit Society's advocate
should be issued to borrowers then, file a suit for recovery & it should be ensured that the
loan documents are complete in all respect. All the deposits obtained as security and / or
collateral security should be appropriated towards the outstanding before filing of the suit.

 All the assets which are in the custody of the Credit Society should be disposed of and
the sale proceeds should be appropriated towards the outstanding in the account and
the suit be filed for recovery offer sidual amount.
 Before filing of the suit: information regarding movable/ immovable assets of the
borrower and the guarantor is ascertained then steps should be taken for attachment of
these properties before judgment.
 Branches should approach such as LokAdalats, which is arranged in that area for
speedy disposal of the cases.

E) Norms in respect of writing off of balances in the borrower accounts.

 The accounts, balances of which are to be written off must have been classified as Loss
Assets Or Doubtful above three years after obtaining report from branch manager.

 If in the accounts having balance is up to Rs.25, 000/-should be recommended to the

Board for write off and reports are scrutinized at the head office.

 Where balance amount above Rs.25, 000/- decision about writing off should be taken
by

Recovery Committee of the Board.

 These actions should be taken in consultation with the Accounts & Operations
Department at Office and the aggregate amount to be of the written off should be
finalized with the approval Accounts & Operations Department.
The Credit Society can take efforts for recovery even the balance in the account is
written off.
F) Compromise / Settlement

When the account has been classified as or loss assets, then only compromise is made
doubtful and only genuine reason can standard account. Consider about sub interest amount
then no remission is granted in.

 When compromising is scarified only on principal amount, except deserving causes. If

the Credit Society deems fit.
 The compromise / settlement should be received from the borrowers, it should be
ensured granted is not less than the cost of fund. During the up to.
 While considering the settlement proposals 90%. In case we recover the interest at not
be at that the interest earned in the respective. In certain deserving cases lower rate
account last 10 years the average cost of fund. Works 11% from the date of NPA the
Credit Society or settlement/compromise are to consider at would be considered. E
Proposals for remission in penal interest or Head Office level only. Faulting borrowers.

G) Dissemination of information

Should be reported to Reserve Credit Society of India in. The information about defaulting
borrowers prescribed form.
The information should be correct and account should be thoroughly verified. Here
information includes out stand images, addresses, names of the proprietors, partners,
directors etc. In case of will full defaulters, their account should be thoroughly verified and
it should come under the definition of will full defaulter as prescribed by Reserve Credit
Society of India.
 On identification of borrower as will full defaulter, a 15 days Show Cause
Notice should be issued to him/her seeking his/her say as to why he/she should
not be treated as a will full defaulter, and if there isn't any response from
borrowers, then the name of the concerned borrower should be recommended
to the committee for identification of will full defaulters.
 • After approval by the com matte the name is reported as will full defaulter to
Reserve Credit Society of India.

H) One Time Settlement Scheme ---

Especially for MSME Sector NPAs.

(Approved by Board Meeting dated 23/02/2010)

Accordingly, the Reserve Credit Society of India has advised Credit Societys to draw
up an OTS Scheme duly approved by Credit Society's Board of Directors.

l. In compliance with the directives of Reserve Credit Society of India and to get the
NPAs in the A foresaid sector recovered, we have drafted a non-discretionary and
non- discriminatory One
Time Settlement Scheme for MSME Sector. After approval by the

2. Board of Directors, Scheme will be made operative with immediate effect.

Tils of the Scheme are Iven as under.

All accounts under MSME sector classified as NPA as on 31/03/2009, are eligible for
settlement under the scheme

Account identified and covered under Low Value NPA Settlement Scheme are not
eligible. All suit filed cases including decreed cases where execution proceedings have
not yet started are eligible under the scheme.

 OTS approved earlier shall not be generally covered under the Scheme, if part payment
has been received and proposal in under implementation.
 Cases of Willful Default, fraud and malfeasance are not covered under the scheme
2.7.2 PROVISIONING NORMS

The primary responsibility for making adequate provisions for any diminution in the
value of loan assets, investment or other assets is that of the Credit Society
managements and the statutory auditors. The assessment made by the inspecting officer
of the CO OP COMMISSIONER ACT is furnished to the Credit Society to assist the
Credit Society management and the statutory auditors in taking a decision in regard to
making adequate and necessary provisions in terms of prudential guidelines. In
conformity with the prudential norms, Provisions should be made on the non-
performing assets on the basis of classification of assets into prescribed categories.
Taking into account the time lag between an account becoming doubtful of recovery, its
recognition as such, the realization of the security and the erosion over time in the value
of security charged to the Credit Society, the Credit Societys should make provision
against substandard assets, doubtful assets and loss assets as follows

Categories of NPA S Provision Required

Substandard Assets 15 %

Doubtful Assets

Sub – Categories : ( Secured + Unsecured )

Doubtful up to 1 Year (D1) 25% + 100%

Doubtful for 1 to 3 Years (D2) 40% + 100%

Doubtful more than Years (D3) 100% + 100%

Loss Assets 100 %

 2.7.3 Prudential norms relating to Floating Provision :
1. The Credit Society’s board of directors should lay down approved policy
regarding the level to which the floating provision can be created. The Credit
Society should hold floating provisions for ‘advances’ and ‘investments’
separately and the guidelines prescribed will be applicable to floating provisions
held for both ‘advances’ & ‘investment’ portfolios.

Principle for utilization of floating provisions by Credit Societys

 The floating provisions should not be making specific provision as per the prudential
guidelines in respect of nonperforming assets or for making regulatory provisions for
standard assets. The floating provisions can be used only for contingencies under
extraordinary circumstances for making specific provisions in impaired accounts after
obtaining board's approval and with prior permission of CO OP COMMISSIONER
ACT. The boards of the Credit Societys should lay down an approved policy as to
what circumstances would be considered extraordinary.

 To facilitate Credit Societys' boards to evolve suitable policies in this regard, it is

clarified that the extra-ordinary circumstances refer to losses which do not arise in
the normal course of business and are exceptional and non-recurring in nature. These
extra-ordinary circumstances could broadly fall under three categories viz. General,
Market and Credit. Under general category, there can be situations where Credit
Society is put unexpectedly to loss due to events such as civil unrest or collapse of
currency in a country. Natural calamities and pandemics may also be included in the
general category. Market category would include events such as a general melt down
in the markets, which affects the entire financial system. Among the credit category,
only exceptional credit losses would be considered as an extra-ordinary
circumstance.
  In terms of the Agricultural Debt Waiver and Debt Relief Scheme, 2008, lending
institutions shall neither claim from the Central Government, nor recover from the
farmer, interest in excess of the principal amount, unapplied interest, penal interest,
legal charges, inspection charges and miscellaneous charges, etc. All such interest /
charges will be borne by the lending institutions. In view of the extraordinary
circumstances in which the Credit Societys are required to bear such interest /
charges, Credit Societys are allowed, as a onetime measure, to utilize, at their
discretion,

The Floating Provisions held for 'advances' portfolio, only to the extent of meeting the
interest / clearages referred to above.

III. Accounting of Floating provisions

 Floating provisions cannot be reversed by credit to the profit and loss account. They
can only be utilized for making specific provisions in extraordinary circumstances as
mentioned above. Until such utilization, these provisions can be netted off from gross
NPAs to arrive at disclosure of net NPAs. Alternatively, they can be treated as part of.
 Tier IL capital within the overall ceiling of 1.25 % of total risk weighted assets.

IV. Disclosure of Floating Provisions

Credit Societys should make comprehensive disclosures on floating provisions in the "notes
to accounts" to the balance sheet on:

(a) 0pening balance in the floating provisions account,

(b)The quantum of floating provisions made in the accounting year,

(c)Purpose and amount of draw down made during the accounting year, and
(d)Closing balance in the floating provisions account.

Control to NPAs:

Is proved beyond doubt that NPAs in Credit Society ought ‘to be kept at the lowest
level. Two pronged it. Preventive Measures and (ii) Curative Measures would be
necessary for approaches controlling.

2.8.1 Preventive Measures:

(I) Credit Assessment and Risk Management Mechanism:

A lasting solution to the problem of NPAs can be achieved only with proper
credit assessment and risk management mechanism. The documentation of credit policy
and credit audit immediately after the sanction is necessary to upgrade the quality of credit
appraisal in Credit Societys. In a situation of liquidity overhang the enthusiasm of the
Credit Societying system is to increase lending with compromise on asset quality, raising
concern about adverse selection and potential danger of addition to the NPAs stock. It is
necessary that the Credit Societying system is equipped with prudential norms to minimize
if not completely avoid the problem of credit risk.

(ii) Organization Restructuring:

With regard to internal factors leading to NPAs the onus for containing the same rest with
the Credit Society themselves. These will necessities organizational restructuring
improvement in the managerial efficiency, skill up gradation for proper assessment of
credit worthiness and a change in the attitude of the Credit Societys towards legal action,
which is traditionally viewed as a measure of the last.
(iii) Dependence on Interest:

Credit Societys largely depending upon lend ing and investments. The Credit Societys
in the developed do not depend upon this income whereas 86 percent of income of Indian
Credit Societys is accounted from interest and the rest of the income is fee based, The
Credit Societyer can earn sufficient net margin by investing in safer securities though not at
high rate of interest, It facilitates for limiting of high level of NPAs gradually. It is possible
that average yield on loans and advances net default provisions and services costs do not
exceed the average yield on safety securities because of the absence of risk and service
cost.

(iv) Potential and Borderline NPA’s under Check:

The potential and borderline accounts require quick diagnosis and remedial measures so
that they do not step into NPAs categories. The auditors of the Credit Societying
companies must monitor all outstanding accounts in respect of accounts enjoying credit
limits beyond cut — off points, so that new sub-standard assets can be kept under check.

2.8.2 Curative Measures:

The curative measures are designed to maximize recoveries so that Credit Societys funds
locked up in NPAs are released for recycling. The Central government and CO OP
COMMISSIONER ACT have taken steps for arresting incidence of fresh NPAs and
creating legal and regulatory environment to facilitate the recovery of existing NPAs of
Credit Societys. They are: Debt Recovery Tribunals (DRT): In order to expedite speedy
disposal of high value claims of Credit Societys Debt Recovery Tribunals were setup. The
Central Government has amended the recovery of debts due to Credit Societys and
financial institutions Act in January 2000 for enhancing the effectiveness of DRTs. The
provisions for placement of more than one recovery officer, power to attach dependents
property before judgment, penal provision for of Tribunals order and appointment of
receiver with powers of realization, protection and preservation of property are expected
to private necessary teeth to parts and speed up the recovery of NPAs in times to come.

The LokAdalats institutions help Credit Societys to settle disputes involving accounts in
doubtful and loss categories. These are proved to be an effective institution for settlement
of dues in respect of smaller loans. The LokAdalats and Debt Recovery Tribunals have
been empowered to organize

LokAdalats to decide for NPAs of Rs. 10 lakhs and above.

ii.Asset Reconstruction Company (ARC):

The Narasimham Committee on financial system (1991) has recommended for setting up of
Asset Reconstruction Funds (ARF). The following concerns were expressed by the
committee.

• It was felt that centralized all India fund will severely handicap in its recovery efforts
by lack of widespread geographical reach which individual Credit Society possess
and.

• Given the large fiscal deficits, there will be a problem of financing the ARF.

Subsequently, the Narasimham committee on Credit Societying sector reforms has

recommended for transfer of sticky assets of Credit Societys to the ARC. Thereafter the
Varma committee on restructuring weak public sector Credit Societys has also viewed the
separation of NPAs and its transfer thereafter to the ARF is an important element in a
comprehensive restructuring strategy for weak Credit Societys. In recognition of the same
ARC Bill was passed to regulate Securitization and Reconstruction of financial assets and
enforcement of security interest. The ICICI CREDIT SOCIETY has promoted the
country's first Asset Reconstruction Company. The company is specialized in recovery and
liquidation of. The NPAs can be assigned to ARC by Credit Societys at a discounted price.
The objective of ARC is necessary steps for recovery of NPAs for recovery of NPAs from
the borrowers directly. Tcs ottetiote cleaning of balance sheet of Credit Societys by sticky
loans.

(iii). Cbt Restructuring (CDR):

The comocate debt restructuring is one of the methods suggested for the reduction of
NPAs. Its objective is to ensure a tingly and transparent mechanism for restructure of
corporate debts of viable cotvorate entities affected by the contributing factors outside the
purview of BIFR, DRT and other legal proceedings for the benefit of concerned. The CDR
has three tier structure viz., a. CDR standing forum b. CDR empowered group and c. CDR
cell. The Mechanism of the CDR: It is a voluntary system based on debtors and creditors
agreement. It will not apply to accounts imlving one financial

Institution or one Credit Society instead it covers multiple Credit Societying accounts,
syndication, consortium accounts with outstanding exposure of Rs. 20 crores and above by
Credit Societys and institutions. The CDR system is applicable to standard and sub —
standard accounts with potential cases of NPAs getting a priority. In addition to the steps
taken by the CO OP COMMISSIONER ACT and Government of India for arresting the
incidence of new NPAs and creating legal and regulatory environment to facilitate for the
recovery of existing NPAs of Credit Societys, the following measures were initiated for
reduction of NPAs. Circulation of Information of Defaulters: The CO OP COMMISSIONER
ACT has put in place a for periodical circulation of details of will full defaulters of Credit
Societys and financial institutions. The CO OP COMMISSIONER ACT also publishes a list
of borrowers (with outstanding aggregate rupees one crores and above) against whom Credit
Societys and financial institutions in recovery of funds have filed suits as on 31st March
every year. It will serve as a caution list while considering a request for new or additional
credit limits from defaulting borrowing units and also from the directors, proprietors and
partners of these entities. The board of directors are requested to review accounts of one
crore and above with special reference to fix Staff accountability in individually.
(v) Credit Information Bureau:
The institutionalization of information sharing arrangement is now possible through the
newly formed Credit Information Bureau of India Limited (CIBJL) it was set up in January
2001, by SBI, flDFC, and two foreign technology partners. This will prevent those who take
advantage of Jack of system of information sharing amongst leading institutions to borrow
large amount against same assets and property, which has in no measures contributed to the
incremental of NPAs of Credit Societys.
9. Imbalances of inventories

10. Lack of proper planning

11. Dependence on single customer

12. Lack of expertise

13. Improper wor

Other causes

l. Fast changing technology

2. Unhelpful attitude of the govt.

3. Changes in consumer preferences

4. Increase in material cost

 Chapter 3:
Organization
Profile
 3.1 INTRODUCTION TO ORGANISATION

Name of the Unit : KARMAVEER BHAURAO PATIL NAGARI SAH

PATSANSTHA MARYA. SANGLI

Address: 7/50, Janata Chowk, Ichalkaranji- 416115. Dist. Kolhapur,

Maharashtra

Phone: 0230-2430025, 2430210

Fax: 0230- 2432210.

Vision

Ichalkaranji is one of the fastest growing Industrial City in Maharashtra

and has even been termed the ‘’Manchester of Maharashtra’’ because of textile
Industry. The KARMAVEER BHAURAO PATIL NAGARI SAH
PATSANSTHA MARYA. SANGLI

has emerged as one of the leading Co-Operative Credit Society. With the
modest beginning in 1995 in the Co-Operative field. Credit Society has obtained
Audit class ‘A’ from the beginning. To stay in the cut throat competition Credit
Society installed the Core Credit Societying Solution (CBS) firstly in
Ichalkaranji.

KARMAVEER BHAURAO PATIL NAGARI SAH PATSANSTHA

MARYA. SANGLI

presently is catering to the needs of society through a close network of 6

Braches spread all over the Kolhapur District. All these Braches have made
remarkable progress on all fronts in all these years. KARMAVEER BHAURAO
PATIL NAGARI SAH PATSANSTHA MARYA. SANGLI
believes that ‘’customer delight’’ is the ultimate goal and has a strong belief
that Customers & all Stakeholders wholehearted support, absolute faith and
their patronage has largely been responsible for its enviable growth.
KARMAVEER BHAURAO PATIL NAGARI SAH PATSANSTHA MARYA.
SANGLI

committed to provide Credit Societying with speed, comfort and convenience.

KARMAVEER BHAURAO PATIL NAGARI SAH PATSANSTHA MARYA.
SANGLI

feels proud to acknowledge the growth of large number of successful

industrialists, traders and professionals who have grown leaps & bound due to
timely assistance and support of the Credit Society Founder Members.
3.2 Management:

BOD

Mr. Ravsaheb Jingonda Patil Chairman

Smt. Bharati Appasaheb Chopade Vice Chairman
Adv. S.P. Magdum Director
Dr. Narendra Ananda Khade Director
Dr. Ramesh Vasantrao Dhabu Director
Mr. Lalasaheb Bhausaheb Thote Director
Mr. A.K. Chougule Director
Mr. Vasantrao Dhulappanna Navale Director
Mrs. Lalita Ashok Sakale Director
Late. Dr. A.D. Patil Director
Mr. Appasaheb Dadu Gavali Director
Mr. Bajarang Bhauso Mali Director
Mr. Mahesh Bhagwan Sant Director
Dr. S.B.Patil - Motake Director
Mr. Gulappa Kariappa Shirgire Director
Mr. Anil Shripal Magdum Chief Executive Officer

3.3 Mission

 Professional Board & Pragmatic decision making.

 Stability in growth and profit.
 Balanced Credit portfolio and Focus on credit and SLE segment.
 Strong focus on Recovery and NPA Management.
 Value Added Service for customers.
3.4 Motto

Merchant Credit Society : The Right Choice for Your Development.

3.5 Service Offered

 Locker Facilities
 Debit Card Facilities
 RTGS
 NEPT
 SMS Alert
 PAN Card
 Aadhar Card Linkage
 Bachat Gat

3.6 Loan Offers

 Home loans
 Cash Credit Loans
 Vehicle loan
 Agriculture Loan
 Business Loan
 Gold loan
3.7 NAME OF Departments

1. Legal Department

2. Risk Management Department

3. Account Operation Department

4. Management Information System Department

5. Inspections Department

6. Secretary Department

7.Development Department

8.Planning Department

9.Insurance Cell

10.Credit Department

11. Agriculture credit Department

12. Recovery Department

13. Compliance

14. Information Technology Department

15. Treasury Department

3.8 Achievements:

 Credit Society of the Year Award in year 2016.

 FCBA Award of Credit Society Frontier.
Chapter 4 :
Data
Analysis
 Interpretation
4.1.1 Percentage of Net NPA (In Lacks)

Sr.No Particulars 31.03.201 31.03.2018 31.03.201 31.03.2020 31.03.2021

7 9
1. Net NPA 0% 0% 0% 0.51% 0%

GRAPHICAL REPRESNTATION :

NET NPA
0.6

0.5

0.4

0.3

0.2

0.1

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

Table 4.1.1

Gross NPA

Above Graph Represnts Net NPA In percentage. This Graph indicating

that the total Percentage of NET NPA for all this Year
4.1.2 Total Loans and Advances (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. Total Loans 148.89 174.29 228.55 307.98 411.86
Advances

TOTAL LOANS AND ADVANCES

450

400

350

300

250

200

150

100

50

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

INTERPRETATION :

The graph shows that total loans and advances of the bank are
increasing per year & as compare to the year 2017 the amounts of total loans
and advances are increased till the year 2021 . It shows the expanding of bank
activities.
4.1.3 Total NPA (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. Total NPA 122.08 247.50 242.25 557.00 634.26

TOTAL NPA
700

600

500

400

300

200

100

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

INTERPRETATION :

The graph shows that NPA is in Incremental trend except in the

year 2019 where it decrease slightly to 242.45 otherwise it shows incremental in
2020 it was 557.00 and in 2021 it was highest 634.26 as compare to all other
years.
4.1.3 Gross NPA (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. GROSS NPA 0.82% 1.42% 1.06% 1.81% 1.54%
%

GROSS NPA
2
1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

INTERPRETATION :

From the above graph we could see that there is incremental trend in
Gross NPA which is in 2017 it was 0.82% and in 2018 it was 1.42% but in 2019
it slightly decreases to 1.06 % again it increases to 2020 1.81% and again in
2021 it decreases slightly to 1.54% .
4.1.4 NET Advances (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. NET 4091.07 4717.32 4812.56 5736.12 7022.08
Advances

NET Advances
8000

7000

6000

5000

4000

3000

2000

1000

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

INTERPRETATION :

The graph shows that net advances were increases every year in year
2017 net advances were 4091.07 but it remains constat in the year 2019 and
2020. In the year 2021 it was 7022.08 as compare to 2017 it is increase by
around 2931.01

In the percentage it is increase by around 71.64% .

4.1.5 NET NPA (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. NET NPA -149.95 -76.11 -174.75 57 -165.74
AMOUNT

NET NPA
100

50

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

-50

-100

-150

-200

Series 1 Column1 Column2

INTERPRETATION :

From the table we could see that for all the year NET NPA amount
was in negative form which is 2017 – 149.95 in 2018 -76.11 in 2019 -174.75
and 2021 it was -165.74 except in the year2020 it was positive which is 57 .
4.1.5 Provision actually (In Lacks)

Sr.No Particulars 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

1. Provision 272.00 323.61 417.00 500.00 800.00
Actually
Made toward
NPA

NET NPA
900

800

700

600

500

400

300

200

100

0
31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021

Series 1 Column1 Column2

INTERPRETATION :

From the above table and graph we could see that there is an incremental
trend in provisiona ctually made towards NPA in 2017 it was 272 in 2018 it was
323.61 which increases in 2019 to 417 again in 2020 it increases to 500 and in
 2021 it goes to 800 . it shows that the credit society is taking good effors for
there financial growth .

4.2 BALANCE SHEET

CAPITAL & AS ON AS ON AS ON AS ON AS ON
LIABILITIES 31.03.2017 31.03.2018 31.03.2019 31.03.2020 31.03.2021
CAPITAL 933.37 1400.95 1453.72 1957.12 2173.07
RESERVE 1350.29 1654.66 1994.75 2356.75 3109.93
FUND AND
OTHER
RESERVE
DEPOSIT 20217.75 23417.97 30666.71 41324.47 55650.78
BORROWING 14889.02 17429.07 22854.57 30798.35 41185.73
INTEREST 2050 2400 2750 3850 4524
PAYBLE
OTHER 948.70 954.94 1289.74 168.28 233.52
LIABILITIES
AND
PROVISION
PROFIT AND 248.19 322.98 366.55 500.00 650.00
LOSS
ACCOUNT
TOTAL 40637.32 47580.57 61376.04 80954.97 107527.03
 Chapter 5:
Findings, Conclusions
&
Recommendations
Findings:
1. Gross NPT ratio of the Credit Society in year 2016-17 is 6% with
suddenly decreases in year 2017-18 i.e.3.34% it is good for Credit Society.
It indicates that credit
Portfolio of Credit Society is good.
2. Net NPA ratio is higher in year 2016-17 i.e.3.18%.But it shows decreasing
trend in year 2017-18 & 2018-2019 i.e. 1.49% & n0.81% respectively.
From this we can say that Credit Society is undertaking effective measures
in case of recovery of loans & provisions.
3. Provision ratio in years 2016-17 is 76.61% and it decreases in years 2017-
18 to 74.32% and again increases in year 2019-19 82.04% From this it is
found that Credit Society is keeping higher safety as compare to last year.
4. From asset wise breakup of NPA it is found that in year 2016-17 & years
2018-19 majority of contribution to NPA is from Medium & Large scale
industry sector.
5. From sector wise breakup of NPA it is found that Doubtful Assets 2(D2)
to NPA is increasing every year.
6. Ratio of Total substandard assets to gross NPAs in year 2016-17 is
26.42% it increases in year 2017-18 & 2018-2019 to 38.54% 39.23%.
7. Ratio of Total loss asset to Gross NPA is scaling down over the years.
Conclusions:-

The project report is not said to be completed unless and until the conclusion is
given to the report. A conclusion reveals the explanations about what the report
has covered and what is essence of the study. What my project covers is
concluded below:

1 Credit Society shows the improvement in ratios of NPA over the years.
2 There are certain guidelines provided by Reserve Credit Society of India
for NPAs, which are adopted by Credit Society.
3 Increase in the contribution of doubtful assets to the NPAs shows
moderate level of rise to the Credit Society.
4 Majority of NPA is generated through medium and large industry sector.
It means Credit Society is facing the problem to recover the loans from
medium and large industry sector
5 There is improvement in provision ratio as compare to last year. It means
Credit Society is providing safety to their funds.
6 From correlation analysis we can conclude that there is a significant
inpacat of NPA increases, profit decreases and When NPA decreases
profit increases.
 Recommendations:

1 Credit Society should etnphasize more on reduction of gross NPAs in

order to improve Net NPA ratio. Only actual recovery of loans will solve
this problem,
2 In order to recover the doubtful assets, Credit Society should undertake
the measures like recovery through agents, legal actions, compromise,
3 Credit Society should implement incentive scheme for the staff to
motivate their involvement in recovery efforts.
4 In case of medium and large industry sector Credit Society should take the
follow up of borrower directly along with the concerned branch. SWOT
analysis of borrowing company will also help in avoiding risk.
5 Credit Society should arrange seminars and workshops periodically to
educate ots borrowers and customers.
BIBLIORAPHY

 Secondary data
Websites:

www.Co Op commissioner act.com

http://www.ichalkaranjimerchantsCredit Society.com/
http://en.wikipedia.org/wiki/NPA
https://Credit Societyingschool.co.in/.../effects-of-npa-on-profitability

 Annual reports of Credit Society

2016-17
2017-18
2018-19
2019-20
2020-21