A PRESENTATION ON COOPERATIVE

BANK

Presented by:by:
Presented
Rakesh.s.g
Rakesh.s.g
Shivakumar
Shivakumar
Neha
Neha
Deepika
Deepika
Jyothi prakash
Jyothi gupta
prakash gupta
 INTRODUCTION
 A cooperative (also co-operative; often referred to as a co-op) is a
business organization owned and operated by a group of individuals
for their mutual benefit.
 It is autonomous associations of persons united voluntarily to meet
their common economic, social, and cultural needs and aspirations
through jointly owned and democratically controlled enterprises.
 A cooperative may also be defined as a business owned and controlled
equally by the people who use its services or by the people who work
there.
 Co-operative banks function on the basis of "no-profit no-loss". Co-
operative banks, as a principle, do not pursue the goal of profit
maximization.
 BACKGROUND
 The Co-operative banks have a history of almost 100 years.
 The Co-operative banks are an important constituent of the Indian
Financial System, judging by the role assigned to them, the
expectations they are supposed to fulfill, their number, and the
number of offices they operate.
 The co-operative movement originated in the West, but the
importance that such banks have assumed in India is rarely paralleled
anywhere else in the world.
 Their role in rural financing continues to be important even today,
and their business in the urban areas also has increased phenomenally
in recent years mainly due to the sharp increase in the number of
primary co-operative banks.
 In India, co-operative banks finance small borrowers in industrial
and trade sectors, besides professional and salary classes.
 Co-operative banks are regulated by the Reserve Bank of India
and governed by the Banking Regulations Act, 1949, and
Banking Laws (Co-operative Societies) Act, 1965. Rural co-
operative banks are regulated by state registrar of co-operatives.
 Urban co-operative banks should have a minimum capital of Rs 4
crore and a membership of at least 3,000 in a population of more
than Rs 10 lakh. The figure of minimum membership keeps
decreasing with a decrease in population.
 SOURCES OF FUND
 The sources of funds for co-operative banks are:
 central and state government, Reserve Bank of India and
NABARD, other co-operative institutions, ownership funds and
deposits or debenture issues.
 Intra-sectoral flows of funds are much greater in co-operative
banking than in commercial banking.
 Inter-bank deposits, borrowings and credit also form a
significant part of assets and liabilities of co-operative banks.
CATEGORIES/STRUCTURE OF COOPERATIVE SOCIETY

1. Primary Urban Co-op Banks

2. Primary Agricultural Credit Societies
3. District Central Co-op Banks
4. State Co-operative Banks
5. Land Development Banks
 Central co-operative banks are the federations of primary
credit societies in a district and are of two types – those
having a membership of primary societies only and those
having a membership of societies as well as individuals.
The funds of the bank consist of share capital, deposits,
loans and overdrafts from state co-operative banks and
joint stocks. These banks finance member societies
within the limits of the borrowing capacity of societies
 State co-operative banks are a federation of central co-
operative banks and act as a watchdog of the co-
operative banking structure in the state. Its funds are
obtained from share capital, deposits, loans and
overdrafts from the Reserve Bank of India. State co-
operative banks lend money to central co-operative
banks and primary societies and not directly to farmers.
 RECENT DEVELOPMENTS
 Over the years, primary (urban) cooperative banks have registered a
significant growth in number, size and volume of business handled.
 As on 31st March, 2003 there were 2,104 UCBs of which 56 were
scheduled banks. About 79 percent of these are located in five states,
- Andhra Pradesh, Gujarat, Karnataka, Maharashtra and Tamil Nadu.
 Recently the problems faced by a few large UCBs have highlighted
some of the difficulties these banks face and policy endeavors are
geared to consolidating and strengthening this sector and improving
governance
 FEATURES OF COOPERATIVE BANK.

 Co-operative Banks are organized and managed on the principal

of co-operation, self-help, and mutual help. They function with
the rule of "one member, one vote". Function on "no profit, no
loss" basis. Co-operative banks, as a principle, do not pursue the
goal of profit maximization.
 Co-operative bank performs all the main banking functions of
deposit mobilization, supply of credit and provision of remittance
facilities.
 Co-operative Banks provide limited banking products and are
functionally specialists in agriculture related products. However,
co-operative banks now provide housing loans also.
 UCBs provide working capital loans and term loan as well.