EXECUTIVE SUMMARY

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

times. Authorities on banking are divided in their opinion regarding

the origin of term bank. The English word bank is derived from the

Italian word Bancho, the Latin word “Bancus” and the French word

“Banque”, which means bank.

As an essential and obligatory part of my course I have undergone 6

weeks, complete summer training at CO-OPERATIVE BANK. This

training helped me in getting practical knowledge in the bakning

environment.

In this project I have tried to provide maximum information about the

LOAN SCHEMES which are provided by the CO-OPERATIVE

BANK.

In this Project Report I have provided all the information which not

only serves the comprehensive knowledge base but also helps the

reader in understanding the fundamentals related to the subject.

In first chapter, the information about bank profile is provided. In

second chapter, review of literature related to loan schemes has been

given. In third chapter,objectives are given and in chapter, research

methodology has been considered. In fifth chapter, main text is given

about the loan schemes.And, in sixth chapter, analysis, findings are

given, and at last some suggestions are given.

1

HISTORY

The Punjab State Cooperative Bank was established on 31st August, 1949 at

Shimla vide registration No. 720 has a principle financing institutionof the

cooperative movement in Punjab. In 1951 its Head Office was shifted to

Jalandhar from where it moved in 1963 to its present building at Chandigarh. In

the cooperative Banking structure, the position of the Punjab State Cooperative

Bank is extremely important as the whole credit system revolves around it. It has

18 branches and 3 extension counter in Chandigarh. There are 19 District

Central Cooperative Banks having 813 branches all over Punjab, mostly in rural

areas of the State. One new Central Cooperative Bank and 110 new bank branches

have been opened during the last four years, 1997-2001.

The term Urban Co-operative Banks (UCBs), though not formally defined, refers

to primary cooperative banks located in urban and semi-urban areas. These banks,

till 1996, were allowed to lend money only for non-agricultural purposes. This

distinction does not hold today. These banks were traditionally centred around

communities, localities work place groups. They essentially lent to small

borrowers and businesses. Today, their scope of operations has widened

considerably.

The origins of the urban cooperative banking movement in India can be traced to

the close of nineteenth century when, inspired by the success of the experiments

related to the cooperative movement in Britain and the cooperative credit

movement in Germany such societies were set up in India. Cooperative societies

are based on the principles of cooperation, - mutual help, democratic decision

making and open membership. Cooperatives represented a new and alternative

approach to organisaton as against proprietary firms, partnership firms and joint

stock companies which represent the dominant form of commercial organization

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The Beginnings

The first known mutual aid society in India was probably the ‘Anyonya Sahakari

Mandali’ organised in the erstwhile princely State of Baroda in 1889 under the

guidance of Vithal Laxman also known as Bhausaheb Kavthekar. Urban co-

operative credit societies, in their formative phase came to be organised on a

community basis to meet the consumption oriented credit needs of their members.

Salary earners’ societies inculcating habits of thrift and self help played a

significant role in popularising the movement, especially amongst the middle

class as well as organized labour. From its origins then to today, the thrust of

UCBs, historically, has been to mobilise savings from the middle and low income

urban groups and purvey credit to their members - many of which belonged to

weaker sections.

The enactment of Cooperative Credit Societies Act, 1904, however, gave the real

impetus to the movement. The first urban cooperative credit society was

registered in Canjeevaram (Kanjivaram) in the erstwhile Madras province in

October, 1904. The Cooperative Credit Societies Act, 1904 was amended in 1912,

with a view to broad basing it to enable organisation of non-credit societies. The

Maclagan Committee of 1915 was appointed to review their performance and

suggest measures for strengthening them.

Under State Purview

The constitutional reforms which led to the passing of the Government of India

Act in 1919 transferred the subject of “Cooperation” from Government of India to

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the Provincial Governments. The Government of Bombay passed the first State

Cooperative Societies Act in 1925 “which not only gave the movement its size

and shape but was a pace setter of cooperative activities and stressed the basic

concept of thrift, self help and mutual aid.” Other States followed. This marked

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

Institutions.

The first study of Urban Co-operative Banks was taken up by RBI in the year

1958-59. The Report published in 1961 acknowledged the widespread and

financially sound framework of urban co-operative banks; emphasized the need to

establish primary urban cooperative banks in new centers and suggested that State

Governments lend active support to their development

Recent Developments

Over the years, primary (urban) cooperative banks have registered a significant

growth in number, size and volume of business handled. As on 31st March, 2003

there were 2,104 UCBs of which 56 were scheduled banks. About 79 percent of

these are located in five states, - Andhra Pradesh, Gujarat, Karnataka,

Maharashtra and Tamil Nadu. Recently the problems faced by a few large UCBs

have highlighted some of the difficulties these banks face and policy endeavours

are geared to consolidating and strengthening this sector and improving

governance.

4

INTRODUCTION OF COOPERATIVE BANK

The Co operative banks in India started functioning almost 100 years ago. The

Cooperative bank is an important constituent of the Indian Financial System,

judging by the role assigned to co operative, the expectations the co operative is

supposed to fulfil, their number, and the number of offices the cooperative bank

operate. Though the co operative movement originated in the West, but the

importance of such banks have assumed in India is rarely paralleled anywhere

else in the world. The cooperative banks in India plays an important role even

today in rural financing

The businessess of cooperative bank in the urban areas also has increased

phenomenally in recent years due to the sharp increase in the number of primary

co-operative banks.

Co operative Banks in India are registered under the Co-operative Societies Act.

The cooperative bank is also regulated by the RBI. They are governed by the

Banking Regulations Act 1949 and Banking Laws (Co-operative Societies) Act,

1965.

Cooperative banks in India finance rural areas under: Farming

Cattle

Milk

Hatchery

Personal finance

5

Cooperative banks in India finance urban areas under:

Self-employment

Industries

Small scale units

Home finance

Consumer finance

Personal finance

Some facts about Cooperative banks in India

Some cooperative banks in India are more forward than many of the state

and private sector banks.

According to NAFCUB the total deposits & lendings of Cooperative

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

New Private Sector Banks.

This exponential growth of Co operative Banks in India is attributed

mainly to their much better local reach, personal interaction with

customers, their ability to catch the nerve of the local clientele.

BANK PROFILE

The Cooperative Bank, a widely diversified bank in India. Cooperative banking

is retail and commercial banking organized on a cooperative basis. Cooperative

banking institutions take deposits and lend money in india. Cooperative banking

6

(for the purposes of this article), includes retail banking, as carried out by credit

unions, mutual savings and loan associations, building societies and cooperatives,

as well as commercial banking services provided by mutual organizations (such

as cooperative federations) to cooperative businesses. Larger institutions are often

called cooperative banks. Some of these banks are tightly integrated federations

of credit unions, though those member credit unions may not subscribe to all nine

of the strict principles of the World Council of Credit Unions. Cooperative

banking systems are also usually more integrated than credit union systems. Local

branches of cooperative banks elect their own boards of directors and manage

their own operations, but most strategic decisions require approval from a central

office.

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

democratically elect the board of directors. Members usually have equal voting

rights, according to the co-operative principle of “one person, one vote”.

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

is usually allocated to constitute reserves. A part of this profit can also be

distributed to the co-operative members, with legal or statutory limitations in most

cases. Co-operative banks are deeply rooted inside local areas and communities.

They are involved in local development and contribute to the sustainable

development of their communities

Cooperative Bank working with its 822 branches all over Punjab.

Mission

We, The Co-operative Bank, will continue to develop our business taking into

account the impact our activities have on the environment and society at large.

The nature of our activities are such that our indirect impact by being selective in

terms of the provision of finance and banking arrangements is more ecologically

significant than the direct impact of our trading opaerations.(Promotion and

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sustainance of economic interest &  providing easy finance, cost effective and

quality banking services ot customer & PACs).

Vision

Co-operative Banks are an important part of the financial system in India. It is,

therefore,necessary that the CBs emerge as a sound and healthy network of jointly

owned, democratically controlled, and ethically managed banking institutions

providing need based quality banking services, essentially to the middle and lower

middle classes and marginalized sections of the society.

Financial Highlights:

 

Financial Highlights(Rs. in Crores)

  March 2008 March 2009 March 2010 (Un-Audited)

Share Capital 33.09 43.60 63.94

Reserves 126.94 180.10 204.24

Deposits 1403.13 1712.07 2540.28

Advances 804.93 1252.79 1897.84

Net NPA (in %) 1.33 % 1.42 % 0.44 %

Working Capital 1640.46 2126.53 2989.33

Net Profit Before Tax

35.89 35.41 35.28

Net Profit After Tax 27.90 30.67 26.86

Capital to Risk Assets Ratio (CRAR)

14.49 % 13.36 % 13.43 %

8

PRESENT BOARD OF DIRECTORS

Chairman – Naib Singh Kohar

Vice Chairman – Budh Singh Dheerowal

Managing Director – Anil Dutta

Director – Sukhwinder Singh Lally

Director – Bhupinder Singh Saini

Director – Gurpal Singh Samra

Director – Gurmail Singh

Director – Hardev Singh

Director – Sukhdev Dutt

Director – Jaswinder Singh

Director – Ranjit Singh Kahlon

Director – Rajinder Singh Johal

Director – Sukhwinder Singh

Souvenir Committee

Chairman – Naib Singh Kohar

Managing Director – Anil Dutta

Director – Sukhwinder Singh Lally

9

Director – Gurpal Singh Samra

Distt. Manager – R.K.Guleria

Sr. Manager – Surinder Sharma

President – Gurnek Singh Dhillon

INVESTMENT

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

Breakup.

Punjab State Co-op. Bank Ltd.

Shares100-00

Central Co-op. Bank Ltd. Shares 8400-00

Marketing Society-Shares 200-00

10.52% Punjab Loan 2010 1,10,00,000-00

11.85% Govt. of India 2009 22,00,000-00

11.03% Govt. of India 2012 10,00,000-00

10.70% Govt. of India 2020 25,00,000-00

10.25% Govt. of India 2012 3,500,000-00 Total 2,02,08,700-00

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RATE OF INTEREST ON VARIOUS DEPOSITS

The Citizens Urban Co-operative Bank Ltd. Jalandhar is the only Urban Bank in

the Northern Region who is offering highest ever rate of interest on saving,

recurring and term deposits as compared to the other cooperative and nationalised

Banks. 

Rate of Interest on various term deposits

15 days to 45 days 5%

46 days to 90 days8%

91 days to 180 days 9%

181 days to Less than one year

10%

1 year to less than 3 year10.5%

3 years to less than 5 year

11%

5 years and above 11.5%

Saving Bank Deposit  5%

FEATURES OF COOPERATIVE BANK

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

operation, self-help, and mutual help. They function with the rule of "one

member, one vote". function on "no profit, no loss" basis. Co-operative

banks, as a principle, do not pursue the goal of profit maximization

2) Co-operative bank performs all the main banking functions of deposit

mobilisation, supply of credit and provision of remittance facilities.

3) Co-operative Banks provide limited banking products and are functionally

specialists in agriculture related products. However, co-operative banks

now provide housing loans also.

4) UCBs provide working capital loans and term loan as well.

5) The State Co-operative Banks (SCBs), Central Co-operative Banks

(CCBs) and Urban Co-operative Banks (UCBs) can normally extend

housing loans upto Rs 1 lakh to an individual. The scheduled UCBs,

however, can lend upto Rs 3 lakh for housing purposes. The UCBs can

provide advances against shares and debentures also.

6) Co-operative bank do banking business mainly in the agriculture and rural

sector. However, UCBs, SCBs, and CCBs operate in semi urban, urban,

and metropolitan areas also. The urban and non- agricultural business of

these banks has grown over the years. The co-operative banks demonstrate

a shift from rural to urban, while the commercial banks, from urban to

rural.

7) Co-operative banks are perhaps the first government sponsored,

government-supported, and government-subsidised financial agency in

India. They get financial and other help from the Reserve Bank of India

NABARD, central government and state governments. They constitute the

"most favoured" banking sector with risk of nationalisation. For

commercial banks, the Reserve Bank of India is lender of last resort, but

co-operative banks it is the lender of first resort which provides financial

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resources in the form of contribution to the initial capital (through state

government), working capital, refinance.

8) Co-operative Banks belong to the money market as well as to the capital

market.

9) Primary agricultural credit societies provide short term and medium term

loans.

10) Land Development Banks (LDBs) provide long-term loans. SCBs and

CCBs also provide both short term and term loans.

11) Co-operative banks are financial intermediaries only partially. The

sources of their funds (resources) are (a) central and state government, (b)

the Reserve Bank of India and NABARD, (c) other co-operative

institutions, (d) ownership funds and, (e) deposits or debenture issues. It is

interesting to note that intra-sectoral flows of funds are much greater in

co-operative banking than in commercial banking. Inter-bank deposits,

borrowings, and credit from a significant part of assets and liabilities of

co-operative banks. This means that intra-sectoral competition is absent

and intra-sectoral integration is high for co-operative bank.

12) Some co-operative bank are scheduled banks, while others are non-

scheduled banks. For instance, SCBs and some UCBs are scheduled banks

but other co-operative bank are non-scheduled banks. At present, 28 SCBs

and 11 UCBs with Demand and Time Liabilities over Rs 50 crore each

included in the Second Schedule of the Reserve Bank of India Act.

13) Co-operative Banks are subject to CRR and liquidity requirements as

other scheduled and non-scheduled banks are. However, their

requirements are less than commercial banks.

13

SCHEMES FOR LOANS & ADVANCES

As Deposits are pouring in and crosses over a hundred crores mark, Bank's

management has decided to liberalise the loan structure and loans are being

advanced under priority sector to housing and weaker sections of the society at

the following rate of interest i.e.

Below 5 Lacs 15%

Over 5 Lacs 16%

Housing Sector -  loans are being given @ 15% for residential purpose

whereas for commercial purpose, interest is being charged @ 16%.

Various loans schemes are initiated for granting loans to small scale industries,

shopkeepers, traders, unemployed youth, cars & transport vehicles, marriage,

house hold good items etc. at above mentioned rate of interest. Loans are also

being advanced to employees of the Municipal Corporation and the employees of

the other departments upto 50,000 under priority sector.

Term loans are your basic vanilla commercial loan. They typically carry fixed

interest rates, and monthly or quarterly repayment schedules and include a set

maturity date. The range of funds typically available is $25,000 and greater.

Bankers tend to classify term loans into two categories:

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Intermediate-term loans. Usually running less than three years, these loans are

generally repaid in monthly installments (sometimes with balloon payments) from

a business's cash flow. According to the American Bankers Association,

repayment is often tied directly to the useful life of the asset being financed.

Long-term loans. These loans are commonly set for more than three years. Most

are between three and 10 years, and some run for as long as 20 years. Long-term

loans are collateralized by a business's assets and typically require quarterly or

monthly payments derived from profits or cash flow. These loans usually carry

wording that limits the amount of additional financial commitments the business

may take on (including other debts but also dividends or principals' salaries), and

they sometimes require that a certain amount of profit be set-aside to repay the

loan.

VARIOUS LOANS PROVIDED BY COOPERATIVE BANK

1) Scheme For – Financing Rural Housing

2) Scheme For - Urban Housing Loan Scheme

3) Personal Loan

4) Two Wheelers To Farmers

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

6) Cash Credit Facility – To Traders & Others

15

7) Vehicle Loan

8) Coop Rent – Loan Against Rental Income Scheme

9) Loan Scheme For Earnest Money

10) Scheme For Granting Of – Loan Against Property

11) Second Hand Vechicle Loan Scheme

12) Cooperative Education Loan Facility – For Children Of Poor

Farmers,Dalits/BCs and Others Poor Sections

13) Scheme For Providing – Dairy Loan For Purchase Of Cow To Members

Of Cooperative Milk Producer’s Socieities

14) Mai Bhago Istri Shakti Scheme

15) Commercial Dairy Development Scheme

16) Cash Credit Limit For Consumption & Other Socio Economic Needs

(R.C.C.)

ORGANISATION STRUCTURE

The Citizens Urban Co-op. Bank Ltd., Jalandhar is a Body Corporate registered

under the Punjab Co-operative Societies Act 1961 and the rules framed there

under. The bank functions according to the Bye-Laws framed by it and registered

by the Registrar, Co-operative Societies, Punjab. The bank is governed under the

democratically elected Board of Directors who are well reputed persons of the

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area. The term of the Board is 5 years. The Board has employed a Chief

Executive Officer and further staff to run day to day working of the bank.

FUTURE PLAN

The citizens urban co-op. Bank, Ltd. Jalandhar is a fast growing institution which

has made an indelible mark in the history of urban banking in Northern India. The

Board of Directors under the chairmanship of Sh. K.K. Sharma have drawn up

ambitious futuristic plans to compete with other Banking institutions in the

region.

Sector wise proposed targets for the year 2001-02 

Share Capital : The paid up share capital of the Bank as on 31-3-2001 is

4.09 crores. It is proposed to increase the paid-up share capital to Rs. 5

crore in the current financial year.

New Branches : The citizens bank which has now nine branches is

planning to setup three more branches during the financial year 2001-02,

thereby increase the total number of branches to 12. The proposed places

for the setting-up of new branches are :

o Kapurthala

o Bhogpur

o J.P. Nagar, Jalandhar

The above branches are proposed to setup during the year subject to the approval

by the RBI. For the early issuance of licenses, necessary correspondence is being

made with the RBI. Besides that, to have it's own premises is the priority of every

organisation. Keeping this priority in mind, citizens bank has decided to get the

bank building constructed by the engineering cell of Punjab Markfed on it's 53

marla plot adjoining, Hotal Shangrila, Jalandhar and architectural assignment has

already been assigned.

17

DEPOSITS

Banks' management has always given significant importance to deposit

mobilisation in order to strengthen it's financial position. During the current

financial year too, a target of Rs. 132 crores has already been setup. Further

allocation has been made to Branches and their staff for meeting the same in a

stipulated time frame.

ADVANCES

As loans and advances are the real investments of a Bank as they earn income.

Keeping this in mind, the bank has decided to liberalise the loan structure and

proposed to advance Rs. 98 crores to various sectors in the current financial year.

Like the proceeding years, this year too, Board of Directors pledges it's

commitment toward the priority sector advances. Further Bank will also continue

it's efforts to promote housing, which has emerged as a national priority, by

providing financial assistance to various income groups. Above all, we believe in

production by masses instead of mass production, therefore we purposes to start

micro financing in a big way.

RECOVERY MANAGEMENT

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

the last financial year 2000-01 and this trend would continue in the current

financial year too. Serious efforts would be made to bring down the N.P.A's level

which is currently stand at Rs. 1.72 crores. Bank is already planning to initiate

legal actions in such cases and recovery would be effected at the earliest.

HUMAN RESOURCE DEVELOPMENT

Human Resource development always find a high priority on the Bank's agenda in

the past and in the financial year 2001-02 too, number of measures will be taken

to upgrade and fine tuning the knowledge of it's officers and other sub-ordinate

staff including sending them to training in various institutes including

Agriculture, Co-op. Staff Training Institute, Jalandhar an undertaking of Punjab

State Co-op. Bank Ltd. and Vai-Kunth Mehta Insitute of Co-op. Management,

Pune. Besides that Executives & Directors will be send to attend various seminars

and workshops which will be conducted by NAFSCOB, New Delhi to educate

them about the Banking regulation act and co-operative societies act.

AUDIT AND INSPECTION

The Citizens Bank is periodically inspected by Reserve Bank of India and Co-op.

Department. The audit of the bank is conducted by the Audit Department of the

Punjab Government.

19

In addition to it, Bank has appointed it's auditors for Internal audit and checkup. It

is also worth mentioning that Citizens Bank has been classified by as 'A' class co-

operative Bank for the year 99-2000 by Chief Auditor, Co-operative societies,

Punjab Chandigarh for a record 10th time in succession.

INTRODUCING NEW CUSTOMER CARE SERVICE

Customer care is always the first and foremost duty of the Citizens Bank. Keeping

this aspect in mind, Bank is planning to introduce evening service at one of it's

Branch. Besides that, for saving the valuable time of it's esteemed customers and

to provide better and quick service, currency counting machines would be

installed in the remaining seven branches. This facility has already been provided

in the Head Office and it's Mithapur Branch.

BANK AT GLANCE

Position as on

93-94 94-95 95-96 96-97 97-98 98-99 99-2000 2000-01

Share Capital Paid Up

91.91 116.00 155.64 230.00 280.00 336.00 381.00 409.00

Reserve & Other Funds

82.96 143.66 216.70 299.00 453.00 697.00 943.00 1219.00

Deposits 1614.04 1888.42 2977.60 4592.00 6866.00 8081.00 10390.00 11742.00

Loans & Advances

1080.22 1381.46 2041.00 3472.00 5085.00 6628.00 8103.00 8834.00

Working Capital

1861.80 2267.01 3452.00 5308.00 7890.00 9420.00 12085.00 13752.00

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Net Profit 71.83 89.14 101.82 184.11 288.00 301.00 353.00 364.00

HAIWED ABDULLAH, Islamic Banking System, Islamic

Banking Concept, Islamic Banking, Afghanistan, Kandahar

October 12, 2008

Abstract:     

The project identifies the concept of Islamic Banking, from its origin as

mentioned in the Holy Qur'an and reforms being introduced to meet the

requirement of today.

Section one, outlines the aims of the project.

The Second section, deals with methodological issues and attempts used to

justify the choice of researches variables, reasons why they were most appropriate

to my project undertaken.

Section Three, of the project looks at what the Quran says about Islamic finance.

It raises the question that Islamic finance is divinely revealed and must follow the

Shari'a (Islamic law), and therefore, financial transaction can only be conducted

within certain boundary. Section Four, will investigate the origin of Islamic

21

banks, how it has evolved with time, and also why there is this resurgent for this

kind of financial intermediary.

Section Five, will involve a full description of the reasons for the banning of

interest in Islam and its implication.

This will directly lead to Section Six, which will look into what is Islamic bank

and requirement necessary to be classified as a bank for Muslims, and also how is

the concept different from the conventional banks. This chapter will also look into

the many ways that Islamic bank provide services which is within the Shari'a.

Section Seven, will look at the practices of the Islamic banks and the permissible

forms of transactions. This will lead to section eight, which will look at the

problems facing Islamic banks. It will focus on aspect in terms of reforms and

improvement required in order for this kind of banking system to be effective.

Finally, Section Eight concludes the project by discussing briefly the how the

system is doing well and how it still needs to improve. Furthermore I will also

evaluate my methodology.

SHAH DEEPAK, Adequacy of Incentives Under National

Horticulture Board Soft Loan Scheme for Post-Harvest

Infrastructure Facilities

August 2007

Abstract:     

In order to curb post-harvest losses of horticultural produce and attract private

investment in the horticulture industry, the National Horticulture Board (NHB)

had initiated soft loan schemes (SLSs) in 1993-94. Under these schemes, soft loan

assistance with a maximum limit of Rs. 1.00 crore is provided at the rate of 4 per

cent service charges per annum with one year moratorium period to set up

projects related to marketing, processing and also export oriented units and

22

purchase of plants and machinery for the same. The state of Maharashtra received

the maximum assistance under the scheme. The present investigation is an attempt

to evaluate the NHB soft loan schemes for the state of Maharashtra, specially with

respect to the post-harvest infrastructure (PHI) facilities created and adequacy of

incentives under the scheme. This study has made some interesting observations.

The focus of this study is specifically on two grape growers' societies. The study

showed a positive impact of soft loan scheme towards development of PHI

facilities in the area. However, in order to improve the efficiency of the soft loan

schemes, the study also suggested various measures which mainly revolved

around simplification of loan procedure adopted by the NHB, timely

disbursement of the loan, financing of the entire comprehensive project rather

than for certain specific components, subsidization of electricity tariffs for the

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

Research and Development (R&D) unit for the marketing of produce, provision of

foreign market intelligence for the exports of horticultural crops, etc. Participation

of NCDC in working capital requirement of the grape growers' societies is

another suggestion of this study.

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

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

Global Education Industry ,IEA Hobart Paper No. 141

Abstract:     

The first edition of this pioneering book produced surprising conclusions from

23

research around the world into the extent of private education. Drawing on

examples from Argentina, Brazil, Colombia, India, Indonesia, Peru, Romania,

Russia, South Africa, Zimbabwe and other countries, Professor Tooley gave a

snapshot of private education that was unknown to many readers; contrary to

expectations, the private education sector was large in the countries studied, was

innovative, and was not the exclusive domain of the wealthy. On the contrary, he

found that the private sector often provided social responsibility, subsidised

places and student loan schemes.

Tooley identifies the factors that impede or facilitate the development of the

private education sector in various countries, focusing on the regulatory regimes

that may impinge upon private education. This led him to conclude with a

proposal for the role of for-profit education enterprises in promoting equitable

development.

In this second edition, Professor Tooley contributes a new preface which shows

how his work has developed and extended into other countries. In particular, he

provides a fascinating account of how private education is flourishing in China.

Keywords: education, development, third world, poverty

BARTH JAMES.R. ,

AUBURN UNIVERSITY

CAPRIO JR. GERARD

WILLIAMS COLLEGE

LEVINE ROSS , The Regulation and Supervision of Banks

24

Around the World: A New Database.February 2001,University of

Minnesota Financial Studies Working Paper No. 0006; World

Bank Policy Research Working Paper No. 2588

Abstract:     

This new and comprehensive database on the regulation and supervision of banks

in 107 countries should better inform advice about bank regulation and

supervision and lower the marginal cost of empirical research.

International consultants on bank regulation and supervision for developing

countries often base their advice on how their home country does things, for lack

of information on practice in other countries. Recommendations for reform have

tended to be shaped by bias rather than facts.

To better inform advice about bank regulation and supervision and to lower the

marginal cost of empirical research, Barth, Caprio, and Levine present and discuss

a new and comprehensive database on the regulation and supervision of banks in

107 countries. The data, based on surveys sent to national bank regulatory and

supervisory authorities, are now available to researchers and policymakers around

the world.

The data cover such aspects of banking as entry requirements, ownership

restrictions, capital requirements, activity restrictions, external auditing

requirements, characteristics of deposit insurance schemes, loan classification and

provisioning requirements, accounting and disclosure requirements, troubled bank

resolution actions, and (uniquely) the quality of supervisory personnel and their

actions.

The database permits users to learn how banks are currently regulated and

supervised, and about bank structures and deposit insurance schemes, for a broad

cross-section of countries.

25

In addition to describing the data, Barth, Caprio, and Levine show how variables

may be grouped and aggregated. They also show some simple correlations among

selected variables

.

TUMEN SARAH , SHULRUF BOAZ , The effect of student loan

schemes on students returning to study.Published in: Journal of

Higher Education Policy and Management, Volume 30, Issue 4

November 2008 , pages 401 – 414

Abstract:

In this paper populations of students returning to tertiary study in the period 1997-

2005 have been compared with the population of non-returning students who had

the same opportunity to return. Such comparisons were conducted for students

who returned after a break of 1-7 years (seven comparison groups). Students with

the highest likelihood of returning were found to be: (i) students who had an

outstanding student loan prior to their return that had been borrowed for previous

tertiary studies; (ii) students who did not complete the qualification studied

previously; (iii) degree-level university students; and (iv) students who had

26

studied towards qualifications in health, education, society and culture rather than

in management and commerce fields. The major finding reported in this paper is

that a student loan debt does not discourage students from future study. The

findings also suggest that policy decisions were likely to trigger short-term

increases in returning behaviour and that the populations most affected were

likely to be those who left tertiary education in the year in which the policy

decisions were announced.

FIELDEN SANDRA L ,DAWE ADEL J , WOOLNOUGH

HELEN , University of Illinois at Urbana-Champaign's

Academy for Entrepreneurial Leadership Historical Research

Reference in Entrepreneurship

Abstract :     

Purpose – This study focuses on thefactors affecting equality of access to UK

government grant and loaninitiatives and the identification of gender differences

in the uptake of thoseinitiatives. Design/methodology/approach – A qualitative

methodology was adoptedas quantitative data is already available regarding the

sources and levels offinancing accessed. In total 32 interviews were conducted

with 18 women and 14men seeking business start-up capital. A review of the

advice and assistanceoffered by 31 business support agencies to potential and

27

existing male andfemale business clients across the region also was undertaken.

Findings – The findings revealed that there is a discrepancy in thenumber of men

and women business owners accessing grant and loans schemes.Women do not

enter into business ownership with the same amount of capital asmen, and women

are far more likely to access loans and grants than traditionalforms of financing.

Research limitations/implications – This is a preliminaryinvestigation which

needs to be extended and the relationship between serviceproviders and small

business owners further explored to provide a greaterunderstanding of the

complexities that relationship has on accessing governmentgrants/loans. Practical

implications – The grant and loan system is highly complexand fraught with

difficulties, which appears to exclude women and morespecifically those from

lower socioeconomic backgrounds, i.e. those they weredesigned to assist.

Originality/value – Previous research has focused on private sectorsources of

business finance. This study is the first to look specifically atgovernment

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

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

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

financing, Gender discrimination, Government grants.

Dr. K C CHAKRABARTY , Education Loan Scheme from

Indian Banks - Reserve Bank's Assurance

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

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

India assured the

28

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

Group and Action 2020 Team.

India Vision Group has been taking up periodically important issues of common

concern with respective higher Authorities with a positive approach to find out

best possible solutions.  In the recent days, we have been receiving lot of

grievances from various 'voiceless' people that they could not pursue higher

education for want of funds.

One one side, it is reported that if the students are hailing from poor families, the

Banks do not consider them worthy of education loans, however brilliant they are.

They are asked to run pillar to post.; They are being asked to provide collateral

security even for small amounts, etc.  On the other side,  due to privatisation of

education, the cost of education has also gone up which could not be afforded by

these poor and intelligent students.  There are many instances, where such

brilliant students end up their ambitions by joining some menial jobs.  This

century is considered as Knowledge Century and the country is losing many

people who could have otherwise become great scholars and scientists,

technocrats.

KHANDKER SHAHIDUR R.

WORLD BANK DEVELOPMENT RESEARCH GROUP

FARUQEE RASHIDUR R.

WORLD BANK ,

The Impact of Farm Credit in Pakistan,

29

November 30, 1999,

World Bank Policy Research Working Paper No. 2653

Abstract:

The Agricultural Development Bank of Pakistan (ADBP), which provides most

formal loans in Pakistan's rural areas, lends to largeholders far more than to

smallholders, although the impact of credit is greater for the smallholders.

Targeting credit to smallholders would make ADBP's credit scheme more cost-

effective. To reach poor farmers and farmers without assets - in other words, to

reduce poverty-stringent collateral requirements should be relaxed and outreach

should be broadened.Both formal and informal loans matter in agriculture. But

formal lenders provide much more in production lending than do informal

lenders, often at a higher cost than what they can recover. The Agricultural

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

of formal loans in rural areas, incurs high costs on loan defaults.

Like other governments, the Government of Pakistan subsidized the formal

scheme on the grounds that lending to agriculture is a high-risk activity because

of covariate risk.

Because farm credit schemes are subsidized, policymakers must know if these

schemes are worth supporting. Using recent data from a large household survey

from rural Pakistan, Khandker and Faruqee estimate the cost-effectiveness of the

ADBP loans. To estimate credit's impact, they use a two-stage method, which

takes into account the endogeneity of borrowing.

Clearly, formal lenders are biased toward larger farmers with collateral. Large

landowners, who tend to represent only 4 percent of rural households, get 42

percent of formal loans. Landless and subsistence farmers, who represent more

than 69 percent of rural households, receive only 23 percent of formal loans.

30

ADBP loans improve household welfare but, although large farmers receive most

of the ADBP finance, the impact of credit is greater for small farmers than for

large farmers. Large landowners use formal loans unproductively.

Because the ADBP scheme is subsidized, it is not cost-effective for delivering

rural credit. It would be more cost effective if small farmers were better targeted

instead.

This paper - a product of Rural Development, Development Research Group - is

part of a larger effort in the group to understand the cost-effectiveness of

alternative credit delivery systems and their impact on rural poverty.

Working Paper Series.

OBJECTIVES OF THE STUDY

1) To study the customer awareness regarding loan schemes provide by cooperative bank.

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

3) To study the satisfaction level of the customers.

31

NEED OF THE STUDY

If you need money to pay bills or make home improvements, and think the answer

is in refinancing, a second mortgage, or a home equity loan, consider your options

carefully. If you can't make the required payments, you could lose your home as

well as the equity you've built up. That's why it's important not to let anyone talk

32

you into using your home to borrow money you may not be able to afford to pay

back.

Not all loans or lenders are created equal. Some unscrupulous lenders target older

or low-income homeowners and those with credit problems. These lenders may

offer loans based on the equity in your home, not on your ability to repay the loan.

High interest rates and credit costs can make it very expensive to borrow money,

even if you use your home as collateral.

Talk to an attorney, financial advisor, or someone else you trust before you make

any decisions about borrowing money. Non-profit credit and housing counseling

services also can be useful in helping you manage your credit and make smart

decisions about loans.

SCOPE OF THE STUDY

If you’ve been at this business long enough, within a few hours of starting a loan

review you can usually get a pretty good sense how that bank is doing. The

remaining hours/days/weeks of a loan review are typically spent reinforcing those

initial findings (not to mention the billable hours).

33

At CRG, we’ve developed a quick review, called “Loan Scope,” that focuses on

an insightful big-picture analysis of your risk and control management as it relates

to lending. We serve as another pair of eyes by zeroing in on where your

institution is at the greatest regulatory and market risk. And we can do that in a

matter of hours, thereby saving you thousands of dollars.

While you may still want expanded loan reviews (and we’re willing to do them),

we find that our loan review provides our clients an excellent value by detailing

their key strengths and weaknesses, as well as a report that you can build upon

and measure against in the future.

Loan Scope reports address level and trend analysis from available sources as

well as logic in terms of your institution’s capacity to manage key elements of

lending risk, including CRE analysis, interest rate shock analysis and ALLL

positioning. We evaluate the strength of your control over the lending process by

evaluating personnel and their capacity to demonstrate control through key

documentation.

RESEARCH METHODOLOGY

Introduction and Meaning

Research is a careful investigation or inquiry especially through search for new

facts in branch of knowledge: market research specifies the information. Required

to address these issues designs the method for collecting information manage and

implements the data collection process analyses the results and communicates the

finding and their implications.

34

Research problem is the one which requires a researcher to find out the best

solution for the given problem that is to find out the course of action, the action

the objectives can be obtained optimally in the context of a given environment.

Research will often help us reduce risks associated with a new product, but it

cannot take the risk away entirely. It is also important to ascertain whether the

research has been complete. For example, Coca Cola did a great deal of research

prior to releasing the New Coke, and consumers seemed to prefer the taste.

However, consumers were not prepared to have this drink replace traditional

Coke.

Surveys are useful for getting a great deal of specific information. Surveys can

contain open-ended questions (e.g., “In which city and state were you born? _”) or

closed-ended, where the respondent is asked to select answers from a brief list

(e.g., “__Male ___ Female.” Open ended questions have the advantage that the

respondent is not limited to the options listed, and that the respondent is not being

influenced by seeing a list of responses. However, open-ended questions are

often skipped by respondents, and coding them can be quite a challenge. In

general, for surveys to yield meaningful responses, sample sizes of over 100 are

usually required because precision is essential. For example, if a market share of

twenty percent would result in a loss while thirty percent would be profitable, a

confidence interval of 20-35% is too wide to be useful.

RESEARCH DESIGN

Research design is the arrangement for condition for data collection and analysis

of data in a manner that aims to combined relevance to research purpose with

economy in procedure.

A Research design is a master plan or model for the conduct of formal

investigation. It is blue print that it is fallowed in completing study. The research

conducted by me is a descriptive Research. This is descriptive in nature because

35

study is focused on fact finding investigation in a well structured form and is

based on primary data.

TECHNIQUES

The problem definition can be said to be the quite essential part of the research

process; as it determine precisely, what the managerial problem is and the type of

information that the research can generate to help the problem before conducting

the fieldwork. It is better to decide upon the method/technique of data collection.

Generally, there are two technique of data collection are:

1. Census Technique

2. Sample Technique or Convenient sampling

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

in a sample only a part of the universe is studied and conclusion about the entire

universe is drawn about that basis. The census method is costlier and more time

consuming as compared to sampling method but the result are near

representatives than sample method. The availability of resources, time factor

degree of accuracy desire and scope of the problem enable us to apply sample

technique.

Data Collection

The objectives of the project are such that both primary and secondary data is

required to achieve them. So both primary and secondary data was used for the

project. The mode of collecting primary data is questionnaire mode and sources of

secondary data are various magazines, books, newspapers, & websites etc.

1) PRIMARY SOURCE

36

2) SECONDARY SOURCE

PRIMARY DATA are those which are collected a fresh and for the first time thus

happen to be original in character. There are several methods of collecting

primary data, particularly in surveys and descriptive researchers. Important ones

are:

1) Observation method

2) Interview method

3) Through questionnaires

4) Through schedules

5) Other methods which includes

a) Warranty cards

b) Pantry audits

c) Consumer panels

d) Using mechanical devices

e) Distributive audits

Under this PRIMARY DATA COLLECTION, i used as QUESTIONNAIRE to

collect the data.

SECONDARY DATA are those which have already published by someone else

and which have already passed though the statistical process. There are normally

two sources of collecting secondary data:

1) PUBLISHED SOURCES

2) UN-PUBLISHED SOURCES

37

Under this study we used DATA THROUGH INTERNET SOURCE to

collect the data.

RESEARCH PLAN

TYPE OF STUDY........

For completing my study we have gone for sample study because looking at the

size of population. And the time limitation it was not convenient for us to cover

entire population. Hence we have gone for sample study rather than census study.

SAMPLING PLAN

A Sample design is a definite plan for obtaining a sample from a given

population. It refers to the technique or the procedure that researcher would adopt

in selecting items to be inched in the sample i.e. the size of sample. Sampling plan

is determined before data are collected.

38

Sample Plan

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

selected.

Sampling Unit: - Jalandhar

Sampling Technique: - Convenient sampling

Anakysis and Interpretation

After the data collection, it was compiled, classified and tabulated manually and

with help of computer. Then the task of drawing inferences was accomplished

with the help of average and graphic method. Different suggestions given by me

to the Company after analyzing the views of every respondent are also given in

the report.

LIMITATIONS OF THE STUDY

It is said, “Nothing is perfect” and if the quite is true, I am sure that there would

be few shortcoming in this project also. Sincere efforts have been made to

eliminate discrepancies as far as possible but few would have reminded due to

limitations of the study. These are:

1. Limited scope

39

The survey was conducted in Jalandhar thus the respondents belonged to only this

region of the country. This could have brought bias into the study.

2. Nature of the study

The survey concentrated on personal information about incomend other factors.

All these issues are highly sensitive and of compplex nature therefore there could

have been untrue answers to some of the questions.

3. Ambiguous replies

Some of the respondents gave ambiguous replies for certain questions or omitted

the responses to some of them. The interpretation of such responses becomes

difficult and could generate wrong results.

VARIOUS LOANS PROVIDE BY COOPERATIVE

BANK

THE PUNJAB STATE COOPERATIVE AGRICULTURE DEVELOPMENT BANK Ltd.

40

Introduction

Punjab State Cooperative Agricultural Development Bank Ltd. is the apex body

of 70 Primary Cooperative Agricultural Development Banks which make long-

term loans to farmers to enable them to make capital investment in agriculture and

allied activities, including land improvement and better methods of cultivation.

1994-95 Total amount of loans advanced Rs195.87 crore

Every third tubewell installed and every fourth tractor in the state is financed by a

Primary Cooperative Agricultural Development Bank.

Objectives

The Punjab State Cooperative Agricultural Development Bank was established on

February 26,1958, under the provisions of Punjab Cooperative Land Mortgage

Banks Act, 1957 to free farmers from exploitation by moneylenders. The bank

provides long term loans at low rates of interest, repayable in easy installments.

Repayment period varies from 5-15 years, depending upon the purpose of the

loan.

At first the bank advanced loans to enable farmers to pay off old debts and

purchase of land so as to make their holdings economically viable. Later, the

Bank provided loans for improvement of alkaline and saline lands, for purchase of

tractors, tubewells and other modern agricultural equipment. The bank played its

41

  Farm sector Non-farm sector

Amount Rs

186.58

To weaker sections:

Rs4.38 crore

Rs 9.29 crore to 1048

beneficiaries

Recovery87.4 percent

role for the diversification of agriculture by providing loans to the farmers for

various occupations like dairy, poultry, fishery, horticulture, etc. Today, every

third tubewell and every fourth tractor is financed by this bank.

At present, the number of the Primary Cooperative Agricultural Development

Banks in Punjab is 79. From February, 1958 to March 31, 1997 the Bank has

advanced loans amounting to Rs.1619 crore.

Major Schemes/Projects

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

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

birds are financed

Unit Cost (in Rs)

500 layers (1:2 system) 1,00,000

1000 layers (1:2 system) 2,00,000

1000 broiler 71,000

The loan is disbursed in three installments and recovered in 6 years. Grace period

is one year. In the next five years the loan will be recovered in 10 equal half-

yearly installments. The borrower must insurance birds and shed. Farmers must

be trained in Poultry Development by the Punjab Agriculture University or

Animal Husbandry Department of Punjab. Day old chicks be purchased from

dealers approved by the Animal Husbandry department of Punjab.

42

HOME LOAN

The Reserve Bank of India’s recent move to increase the home loan limit for

cooperative banks to Rs30 lakh from Rs5 lakh at present is likely to give a boost

to cooperative banking sector in the state. This is expected to be of great help to

rural middle class segment.

The RBI has decided that the maximum quantum of housing loan that can be

granted to an individual borrower by a state/central cooperative bank would now

be Rs20 lakh. However, in case of a cooperative bank having a net worth of

Rs100 crore and above, as per the assessment made in Nabard’s latest inspection

report, the limit will be Rs30 lakh.

The chairman of Gujarat State Cooperative Bank, Ajay Patel, has welcomed the

move. He said this step of the regulator has opened a safe avenue of credit for

cooperative banks. “The rural middle class is going to benefit from this move as

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

said.

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

societies on any day should not exceed 10% of total loans and advances of the

bank as on March 31 of the preceding year. However, this limit can be exceeded

to the extent of funds obtained for the purpose from a higher financing agency and

refinance from the Nation l Housing Bank. Earlier, the RBI had directed that

aggregate housing loans outstanding on any day should not exceed 5% of total

deposits of the banks.

Patel said as real estate prices in rural areas are also going up, this step of the RBI

was in the right direction. RBI has, however, clarified that housing loans would

43

not include finance to commercial real estate sector. Cooperative banks have been

advised that they should desist from financing the commercial real estate sector.

For repairs, additions, alterations etc to existing houses, the maximum amount of

loan per individual borrower stands revised to Rs1 lakh, which was Rs50,000 till

now.

LOAN FOR PURCHASE OF LAND

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

to the tune of Rs. 50000/- to Rs. 10 lakhs to individual Small Farmers/Marginal

Farmers/Share cropper/ Tenant farmers for purchase of land. Loans given to

individual farmer to make the small and marginal holding economically viable

and to bring fallow and waste land under cultivation and to step up agricultural

production and productivity. Loan will be in the form long term in nature with

maximum period of 9 years including 2 years moratorium.

MORTGAGE LOAN SCHEME

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

rate of interest. The scheme is for people engaged in trade, commerce & business

and also professionals & self employed, Prop. Firm, partnership firm, companies,

NRIs and individuals with high net worth including salaried people, agriculturists

and staff members. The product provides an opportunity to customers to borrow

44

against a fixed asset (mortgage of property) at a short notice without much paper

work/attendant hassles.

Margin : Salaried Employees          30% *

Others                              50% *

*On value of property [Lower of Market Value /Distress Sale value/Registration

Value as on date of valuation] assessed by Bank's approved valuer.

Rate of Interest:

w.e.f. 21.07.2009 : For loans/overdrafts – 1% over BPLR, 13.00% p.a. Interest

concession for woman beneficiaries 0.25% p.a.[All borrowers to be women]

Repayment :

In accounts where regular Overdraft facility is not proposed. :-

Within a period of eight years by way of EMIs. The repayment shall commence

from the month subsequent to the month in which final disbursement is made or 6

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

agriculturists : The repayment will be related to the generation of farm income

from crops and other subsidiary activities.

Security :

45

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

his/her spouse or parents or third party. The person in whose name the property to

be mortgaged stands should either be a borrower/co-borrower or a guarantor.

Note: :

a. The property offered should be a residential or commercial building or a plot of

land (residential/commercial).

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

government agencies, PSUs, Corporates, etc.

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

PERSONAL LOAN

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

A)Security of funds held in NRO Term Deposits

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

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

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

the borrower.

Please note that-

46

1) The loan shall be utilised for meeting the borrower's personal requirements or

for his own business purposes;

2) The loan shall not be utilised either singly or in association with other person,

for any of the activities in which investment by persons resident outside India is

prohibited, namely;(I) the business of chit fund, or (ii) Nidhi Company, or (iii)

agricultural or plantation activities or in real estate business (excluding

development of townships, construction of residential/ commercial premises,

reads or bridges), or construction of farm houses; or (iv) trading in Transferable

Development Rights (TDRs). (v) Investment in capital markets including margin

trading and derivatives.

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

property shall be duly complied with

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

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

Repayment:Repayment shall be made by fresh inward remittances from outside

India through normal banking channels. The loan can be also repaid out of the

local rupee resources in NRO/NRE/FCNR account of the borrower or through

sale proceeds of shares or securities or immovable property against which such

loan was granted.

47

CAR LOAN

Flexi Mobile Loan from the bank belongs to the category of the Bank Limited

Car Loans. This is a customized financing scheme for car procurement, specially

meant for professionals, individuals, businessmen and traders. Car Loans are also

available for the procurement of used cars (second hand ones).

Customers can finance up to 80% of the cost of a new vehicle along with the cost

of accessories and the life tax through this loan. For second hand cars the

financing margin provided by the bank is 30%. The maximum loan available

under this scheme is Rs. 7.50 Lacs.

DAIRY LOAN

Credit for Individuals and group of farmers for Purchase of high yielding milch

animals (Cattle: Indigenous breed like Gir, Tharparker, etc. and exotic breeds like

Jersey, Holstein fresian, etc. and in case of Buffaloes: Mehsana, Jafarbadi, etc.),

Construction of cattle shed, Purchase of dairy equipments, chaff cutters, etc and

expenditure incurred for transportation of animals where the animals are not

purchased locally.

Eligibility

Individuals and group of farmers experienced in Dairy farming and are actively

engaged in such activity.

48

HOUSE RENT LOAN

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

Products.

This loan product can be used to avail loans against future rental receipts of your

properties. The rent received every month is used as the EMI towards the loan

sanctioned. Any Lessor having a residential / commercial property which is

currently rented to MNC / Banks / Reputed Corporates etc. can apply for loan

under this scheme. Loans can be availed for 36 months or residual lease

agreement whichever is less for upto Rs. 50 Lakhs.

 Purpose

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

(Lessor).

Eligibility

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

which are to be rented or already rented to Multi National Company's / Banks /

Reputed Corporates etc.

49

Loan Amount

75% of the rent receivable less TDS if any, over the period of 36 Months or

Residual Lease / Rent Agreement period whichever is lower subject to a

maximum of Rs.50.00 Lakhs.

Security

On EQM of building against the rentals of which the loan would be sanctioned.

(150% of the loan amount should be covered as collateral security).

Pre-requisite

Assignment of rent receivables from lessor is must. If lessee agrees to remit the

rent directly to the loan account of the borrower, a power of attorney should be

obtained from the Lessor and Lessee.

Repayment

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

Rate of Interest

If the lessee agrees to remit the rent directly to the Loan account of the

borrower - PLR + 0.00% (14.00% p.a.).

50

If the lessor (Building Owner) remits the monthly instalment to the loan

account from the sources of rent and other sources - PLR + 1.00%

(15.00% p.a.).

Current Prime Lending Rate (PLR) is 14.00% p.a.

Margin

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

or residual lease/rent agreement.

EDUCATIONAL LOAN

Purpose

Studies in India & Abroad

Maximum Loan Amount

Rs 20.00 lakhs

Eligibility

 100% of cost of the fees and other expenses on the basis of  the eligibility and

income proof provided by the applicant.

51

Limit of Loan

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

Studies abroad    - Maximum  upto Rs 20.00 Lakhs

Rate Of Interest:

Please contact your nearest branch for repayment plan and interest rates

Repayment Period

Maximum  84 months inclusive of Moratorium period of Max 3 years

Moratorium Period: Duration of the course plus an additional period of six

months or 3 years whichever is earlier. 

Security

Equitable mortgage of Property or pledge of any other tangible security

acceptable to the bank. 

52

Minimum two guarantors of well placed means.

Tangible Investments like LIC (Surrender Value), NSC (Face Value), KVP (Face

Value), Gold (As per Banks Valuation), RBI Bonds or FD’s with our Bank can be

considered while assessing the proposal and for sanctioning the loans.

Processing Fees:

For studies in India – 0.25%

For studies abroad -- 1% of the loan amount

Shareholding

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

Above Rs 2 Lakhs -2.5% of the loan amount(max Rs 25000)

Key features of the scheme:

No prepayment charges.

Issue of solvency certificate

Foreign currency/Demand draft/Travelers Cheques

Loan available on admit letters.

Phased disbursement facility available.

Travel insurance available

Arrangement with Wells Fargo Bank for opening an International Personal

Banking Account in US.

53

Steps to Avail our loan.

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

course, college,     details of total expenses to be incurred on the course, bank loan

applied for, own stake details if any which is going to be brought in, security

offered, moratorium period details

2.  Application form duly filled in.

3.  Students documents:

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

and admission procedure/s

Conditional or unconditional offer in case UK, Canada or New Zealand.

In case of students going to USA – I 20 / Admit letter to be submitted.

Passport copy (in case of education abroad) or identity proof.

Latest academic mark sheets

Work experience proof if any

1 photograph

Pan Card copy

Address proof - Copy of ration card/ Copy of MTNL/ BSES bill/ Copy of

driving license/ Election card.

1 photograph each.

Applicant (Singly or Jointly) with Co-applicant as student / Sponsorer

(only close blood relative) &       Guarantors documents:

Income proof

(i) If Salaried:

3 months latest salary slips

54

6 months bank statements where salary is credited/ other bank statements if

any Income tax returns of last 3 years,Latest Form 16

(ii) If Businessmen/ Self-employed:

Income tax returns of last 3 years and computation of income, balance sheet

and profit & loss a/c.

6 months bank statements where current a/c is maintained / other bank

statements if any

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

FARM MACHANIZATION

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

equipments for agricultural operations. The scheme covers activities ranging from

purchase of tractors and accessories, power tillers, combine harvesters, power

sprayers, dusters, threshers etc.

 Eligibility

For pump set/ Irrigation equipments Farmer should own a minimum of 2 acres of

irrigable land. For Farm machinery, following is the Minimum irrigated land

For power tillers – 2 acres

For tractors with power upto 35 HP – 4 acres

For tractors with power above 35 HP – 6 acres

55

 For combine harvesters – 8 acres

Loan Amount

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

CONVENIENT LOANS AGAINST PROPERTY

Amongst the variety of loans available these days, to help tide over a cash crunch,

banks offer loans against property. Here’s how this works and why it scores over

other types of loans. Ifyou are sitting on a valuable asset in the form of a property,

you never have to worry about your loan applications being rejected. Banks offer

a product called Loans Against Property (LAP), which gives you access to

finance, on the basis of the property that you hold.

Eligibility

LAP is offered to individuals between the age group of 18–60 years and who are

either salaried employees, professionals or selfemployed. Union Bank of India

also offers loans to individuals who don’t pay income tax, as long as they

provide proof of income to the bank. State Bank of India offers loans to

individuals who are engaged in agricultural and allied activities, too.

56

Loan Details

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

property i.e. his residential property. The loan will be approved only if the

residential property is self-occupied; property, which is rented out, is not

covered under this scheme. However, these loans are not offered if the market

value of the property is below a predetermined specification of the issuing bank.

For instance,ICICI Bank offers LAP to individuals only if the market value of

their property is at least Rs 11 lakh, while Kotak Mahindra considers property

that is worth Rs 20 lakh plus. Some lenders, like HDFC are willing to offer a

LAP for property that is worth as little as Rs 5 lakh. Tenure: A LAP is usually

given for a period of 10 to 15 years.

For instance, ICICI Bank offers such loans for a tenure of 15 years and HDFC

sanctions these loans for a period of 10 years. Loan value: Most lenders offer a

minimum loan of any where between Rs 1 lakh to Rs 5 lakh and a maximum of

Rs 50 lakh, (subject to the value of the property that the individual possesses).

For example, ICICI Bank sanctions a minimum of Rs 5 lakh and finances up to

45-60 per cent of the technical market value of the property.

However, it stipulates that the property should be only 25 kilometres away from

an ICICI Bank branch. Kotak Mahindra sanctions loans that are up to 50 per cent

of the market value of the property while HDFC offers up to 60 per cent of the

market value with a minimum loan amount of Rs 1 lakh and a maximum loan

amount of Rs 50 lakh. Union Bank of India offers a maximum loan limit of

Rs 25-50 lakh and a minimum of Rs 1 lakh. State Bank of India lends a minimum

of Rs 1 lakh and a maximum of Rs. 50 lakh subject to the loan amount being

restricted to 24 times the net monthly income of a salaried borrower (net of all

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deductions, including TDS) or twice the net annual income for other borrowers

(income as per the latest IT return, less taxes payable).

Repayment Terms

There are a variety of repayment options available in the market to suit the needs

of the various borrowers. State Bank of India allows you to repay your loan

within a maximum of 60 Equated Monthly Instalments (EMIs). HDFC’s LAP

can be repaid over a maximum period of 15 years on an EMI basis. Kotak

Mahindra Bank allows you a loan repayment period of up to 20 years, which

varies depending on the purpose of the loan and the individual’s profile. Union

Bank of India’s loan must be repaid within a maximum of 60 EMIs with the

bank collecting postdated repayment cheques.

Documentation

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

order to avail of a loan, in the case of a LAP, banks also usually ask for:

Allotment letter of the co-operative society. Agreement for sale/sale deed for the

property. Original title deeds of the property offered for mortgage. Paid receipt

of latest maintenance, water tax, municipal tax and any such taxes. A non-

hindrance letter from the cooperative society.

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NRIs HOUSING LOAN

Purpose 

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

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

   Persons Eligible

  a. All Non Resident Indians holding Indian Passports with a regular monthly

income  of  not less than Rs. 10000/- 

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

the non-resident Indian. 

   Amount of Loan 

60  times the Net Monthly Income (NMI) / Average Monthly Income (AMI) for

persons upto 45 years and 48 times for persons above 45 years of age. However,

the repayment obligation is restricted to Maximum 60% of the NMI/AMI.

 

   Margin 

Upto Rs.30 lac - 20%

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

   Interest  

Linked to our Prime Term Lending Rate and subject to change click on the link

for present interest rates.

COSMOS LOAN

Initiated in the year 1906, the Cosmos Co-operative Bank Ltd is widely known as

for its excellent services. Being the oldest municipal co-operative banks in India,

Cosmos is at present the nation?s foremost organized Co-operative banks with its

multi state presence.

Cosmos Co-operative Bank Ltd, over the years, has carved a market for itself in

the metropolitan banking segment, facilitated by its affluent legacy, honesty,

devotion to the discreet banking measures and technology driven client facilities.

It has also accomplished comprehensive expansion not only in context of

monetary pointers or levels but also in general growth of measures.

The fiscal arrangement of Cosmos Co-operative Bank Ltd in the year 2009 was

Rs. 10946.37 crs entailing investment worth Rs Rs.6843.02 crs and credits worth

Rs. 4004.36 Crs. The bank functions through its 96 sub divisions and 8 annex

segments spread across the nation. Some of its major branches are in the states of

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Maharashtra, Gujarat, Karnataka, Madhya Pradesh, Bangalore and Andhra

Pradesh.

LandmarksAchieved

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

as

The foremost co-op bank with multi state presence that deployed

nationalized banking network

It has a set up of 93 subdivisions, provincial divisions and headquarter

inter linked via the information hub located at Maharashtra.

It provides 24/7 banking services through its various ATM set-ups

Deployment of around 96 ATM's near each of its subdivisions

Around 55,000 ATMs are linked via NFS and Bancs joint venture.

It offer sweep service of capital transfer between bank accounts of clients

It provides the facility to reassign capitals immediately to any account in

their subdivision set-up

Providing RTGS or NEFT facility for immediate capital transmittal

Provision for franking service

Provision for online tariff imbursement service

Account transactions are accessible via e-mails

Availability of intermittent interest on Fixed Deposits in expend via the

Electronic Clearing Scheme (ECS).

Availability of SMS service for bank account balance, details of previous

bank transactions and other status.

Availability of recognition by Pune Corporation Tax

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Facility for cell phone and telephone bill imbursement besides payment of

premiums

ProductandServices

Some of the products and services offered by Cosmos Co-Op. Bank Limited are:

Deposit Schemes such as Cosmo Umbrella, Janasanchay savings scheme,

cosmos kishor scheme, flexi-fixed deposit scheme, etc

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

on yearly basis.

Foreign Exchange Business for NRIs. Accounts available under this

category are Non Resident Ordinary Account (NRO), Non Resident

External Account (NRE), Foreign Currency Non-Resident Account

(FCNR) and Exchange Earner Foreign Currency A/c (EEFC)

Demat account services

FinancialPerformance

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

under:

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

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Reserves estimated as on the year 2009 is Rs 613 Crores

Net Worth estimated as on the year 2009 is Rs 700 Crores

Credits estimated as on the year 2009 is Rs 6656 Crores

Advances estimated as on the year 2009 is Rs 3896 Crores

Endowments estimated as on the year 2009 is Rs 2869 Crores

Profit estimated as on the year 2009 is Rs 90 Crores

Working capital estimated as on the year 2009 is Rs 7563 Crores.

FINDINGS

1. Co-operative bank have different schemes for different fields.

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2. The study has shown that customer wants better branch network and improved services so that they can take loans from different cities also.

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

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

5. From the study we noticed that the procedure for taking loan is easy.

6. From the study we searched that the paper work & formalities for taking loan is much more.

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

operative bank has been providing?

RESPONSE %AGE

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

INTERPRETATION:-

From the above data it has been seen that 44% said the

services are great and 56% said services are satisfactory and

no one said the services are bad. Which depicts that most of

the customers are satisfied wih the facilities and services

provided by co-operative banks.

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

operative bank?

RESPONSE %AGEYES 40%

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NO 20%KNOW A LITTLE 40%TOTAL 100%

INTERPRETATION:

As per the responses from the customers its evident that there

are mixed responses by them , according to their responses

there is equal response in favour of knowledge regarding the

loans schemes by the bank and the same is found that similar

%age of people are having a little knowledge about the loan

schemes.

Q3.The procedure that the customer has to follow for

taking a loan from Co-operative bank is easy?

RESPONSE %AGE SRONGLY AGREE 20%AGREE 30%SOME WHAT AGREE 10%

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DISAGREE 20%STRONGLY DISAGREE 20%TOTAL 100%

INTERPRETATION:

As per the customer responses, the procedure to follow for

loans is found to be easy as 20% of people strongly agree,

30% agree, 10% some what agree, 20% of people disagree

and 20% of people strongly disagree that is an easy task.

Q4. The Co-operative bank has played a great role in

the over all development of the state?

RESPONSE %AGE

AGREE 70%

SOME WHAT AGREE 10%

DISAGREE 20%

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TOTAL 100%

INTERPRETATION:

The role of co-operative banks is considered to be important

in the development of state by 70% of people agree,10% of

people some what agree and the rest of 20% are disagree with

this statement.

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

RESPONSE %AGE

YES 80%

NO 0%

CAN’T SAY 20%

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TOTAL 100%

INTERPRETATION:

As per the responses 80% of the people say that co-

operatives banks keep good relationship with their customers

whether 20% of people are can”t say about this statement.

Q6. Are you satisfied from the interest that Co-

operative bank charge on loans provided by the bank?

RESPONSE %AGE

YES 40%

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NO 60%

TOTAL 100%

INTERPRETATION:

As per the responses its found that 60% of people think that

interest rates provided by co-operative banks are not

satisfactory and 40% of them think its fine.

Q7. Do you think that you get better returns from Co-

operative bank in comparison to the other banks?

RESPONSE %AGE

YES 40%

NO 20%

70

CAN’T SAY 40%

TOTAL 100%

INTERPRETATION:

Its evident from the responses that 40% of people expect

good returns from the co-operative banks and 40% are unable

to justify whereas 20% of people think it don’t offer good

returns.

Q8. How do you compare the schemes with the

schemes of other bank?

RESPONSE %AGE

MINIMUM BALANCE REQUIRED

0%

SECURITY TO BE PLEDGED 40%

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RATE OF INTEREST 40%

PAPER WORK/FORMALITIES 20%

TOTAL 100%

INTERPRETATION:

As per the response people compare the loan schemes with

schemes of other banks through 40% are with security to be

pledged,40% based on rate of interest and rest 20% compare

with paper work/formalities.

Q9. Are you aware of all formalities involved for

sanctioning of loan?

RESPONSE %AGE

YES 50%NO 50%

TOTAL 100%

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INTERPRETATION:

Its evident from the graph that 50% of the customer

responses are aware of the formalities of loan and the same

%age is for non awareness of the loan formalities.

Q10. In your opinion what do you feel which bank

cares more about the customer satisfaction?

RESPONSE %AGE OF FARMERS

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

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INTERPRETATION:

As per response 40% people said that co-operative bank cares

about the customer satisfaction,50% said private bank and

rest 10% said public bank.

SUGGESTIONS

There are some suggestions to Co-operative bank.

There suggestions are as follow:

Interest rate on Gold loan of Co-operative bank is

higher than other banks. So Co-operative bank

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should reduce interest rate on gold loan or it

should provide some more facilities on that loan.

Bank should reduce interest rate and increase the

amount of personal loan to attract borrowers.

Interest rate, rebate and amount of hypothecation

loan of both banks are generally same. The bank

should reduce time period of hypothecation of loan

because it is too high than Co-operative bank.

Bank should reduce the interest rate and increase

the amount of self-employed loan to attract the

borrowers.

The banks should have to concentrate on increase

the recovery of loan to reduce the amount of

overdue and doubtful debt because recovery of

total loan of Co-operative bank is less than the

other banks.

CONCLUSION

After having done detailed study on the topic “Various Loans provided by Co-

operative bank”, it has been concluded that Co-operative Bank is being able to

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achieve its corporate vision and mission tactfully and progressively by providing

different types of loans schemes at competitive rate of interest. Gone are the days

when it was too difficult for the people to buy different types of properties, cars

education etc.

Now this all have become possible with the help of various loans given by at

affordable rate of interest. Although many banks are providing these loans

schemes but people prefer to avail loans from Co-operative Bank.

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

conclude that most of the people are aware but they still need more publicity

among the people. From the study, I conclude that there are some weaknesses in

the bank but as it is well growing bank, they are working hard to overcome these

weakness and threats.

BIBLIOGRAPHY

BOOKS:-

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Itbach Philip G.A, International Book Publishing, volume 1995, Part-2

Naidha kumar jain, How to borrow from Banking and Financial Institutions

LINKS:-

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

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

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

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

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

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

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

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

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

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

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

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

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

QUESTIONNAIRE

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

bank has been providing?

Great Satisfactory Bad

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

Yes No Know a little

Q3. The procedure that the customer has to follow for taking a loan from Co-operative bank is easy?

Strongly agree Agree Some what agree Disagree Strongly disagree

Q4. The Co-operative bank has played a great role in the over all development of the state?

Agree Some what agree Disagree

Q5. Do they have a good relationship with the customers? Yes No Can’t say

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

Yes No

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

Yes No Can’t say

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

Minimum Balance Required Security To Be Pledged Rate Of Interest Paper Work/ Formalities Required

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

Yes No

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

Co-operative Bank Private Banks Public Banks

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