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SUMMER TRAINING REPORT

ON

ASSESSMENT OF CUSTOMER SATISFACTION

(A Case Study on Malviya Urban Cooperative Bank.)

SUBMITTED IN PARTIAL FULLFILLMENT

TO

THE IIS UNIVERSITY

FOR THE DEGREE OF

MBA –HUMAN RESOURCE MANAGEMENT

(Department of HRM&IB)

SUBMITTED TO: SUBMITTED BY:

Dr. SEEMA SINGH RATHORE DIVYA SHEKHAWAT

(ADD.HEAD) M.B.A SEM –III (HRM)

(DEPT. of HRM&IB) ICG/2013/15718

(THE IIS UNIVERSITY)

(2014-2015)



TABLE OF CONTENTS S.No. Topic Page

No.

Acknowledgement ---

Preface ----

Chapter 1 Introduction

Chapter 2 Research Methodology

Meaning of Research

Objective of study

Scope of study

Research design

Data collection

Sampling

Review of literature

Limitations of Study

Chapter 3 Profile Of Malviya urban cooperative bank

Chapter 4 Data analysis and Interpretation

Chapter 5 Findings

Chapter 6 Suggestion &Conclusion

Bibliography

Annexure



ACKNOWLEDGEMENT

I owe my thanks to all the various people helped me in making this project successful. I am

thankful to all people without whose help and guidance an effort to do this work would not have

been successful.

This project report instead of being an individual effort is a collective one where in help from

various quarters especially business and academic one have been derived. The list of those

providing a helping hand is quite comprehensive but it would be pertinent to mention a few who

have played a major role in completion and preparation of the project and continue to have

positive influence in my thought process.

My special thanks go to Prof. M.K Sharma, (DEAN, Faculty of Commerce & Management),

Dr. Ankita Gangwal Jain,(HEAD, Dept. of HRM&IB),and Dr. Seema Singh Rathore

(Additional HEAD, Dept of HRM& IB) under whose guidance I have completed my project

She was there to meet and talk about my ideas and ask me good questions to help me thinkthrough my problems .

I would also like to thank my MRS. MADHU SINGH KHANGAROTH (Senior Manager-HR

MALVIYA URBAN COOPERATIVE BANK) who helps me for guidance provided by, which

help me to complete my project.

At last I would like to thank my family and friends for unconditional support and encouragement

in completion of my project.

DIVYA SHEKHAWAT.



PREFACE

Summer training is essential for the fulfillment of MBA curriculum. It provides an opportunity to

the student to understand the industry with special emphasis on the development of skill in

analyzing interoperating practical problems through application of management.

My research project deals with “customer satisfaction with reference to the MALVIYA URBAN

COOPERATIVE BANK. In this report, I have studied and evaluated the customer satisfaction of

customer.

The first section deals with “customer satisfaction. In this section, I have given a brief conceptual

explanation to customer satisfaction. It contains the definition process and significance of

customer satisfaction. In The second section of my report I have conducted a research study to

evaluate the customer needs and perception towards MUCB. The third section of my report deals

with a detailed profile of the malviya urban cooperative bank. It includes history its operations

etc.this section attempts to give detailed information about the bank and nature of its functioning.The fourth and final section of this report consists of extra information that includes findings,

suggestions, conclusion, bibliography, and annexure.



Customer satisfaction is a term frequently used in marketing. It is a measure of how products

And services supplied by a company meet customer expectation. Customer satisfaction isdefined as "the number of customers, or percentage of total customers, whose reportedexperience with a firm, its products, or its services (ratings) exceeds specified goals. The

meaning of customer satisfaction has been commonly disputed as companies progressively

attempt to review it. Customer satisfaction can be experienced in a wide range of circumstancesand linked with both products and solutions. It is a highly individual evaluation that is

significantly affected by customer satisfaction.

Within organizations, customer satisfaction ratings can have powerful effects. They focus

employees on the importance of fulfilling customers' expectations. Furthermore, when these

ratings dip, they warn of problems that can affect sales and profitability. These metrics quantify

an important dynamic. When a brand has loyal customers, it gains positive word-of-mouth

marketing, which is both free and highly effective. Customer satisfaction provides a leading

indicator of consumer purchase intentions and loyalty. "Customer satisfaction data are among the

most frequently collected indicators of market perceptions. Their principal use is twofold:"

"Within organizations, the collection, analysis and dissemination of these data send a message

about the importance of tending to customers and ensuring that they have a positive experience

with the company's goods and services."

Although sales or market share can indicate how well a firm is performing currently, satisfaction

is perhaps the best indicator of how likely it is that the firm‟s customers will make further

purchases in the

future. Much research has focused on the relationship between customersatisfaction and retention. Studies indicate that the ramifications of satisfaction are most strongly

realized at the extremes Organizations need to retain existing customers while targeting

noncustomers. Measuring customer satisfaction provides an indication of how successful the

organization is at providing products and/or services to the marketplace. The importance of

customer satisfaction is apparent when you realize that, without customers, you don't have a

business. A single unsatisfied customer can send more business away from your company than

10 satisfied customers The more you focus on customer retention and customer support, the

more long-term business you'll get. It's worth it to focus on customer satisfaction strategies, no

matter how large or small your company is understanding the needs of customer is critical .A

business relationship, just like any other relationship, relies on both people getting their needs

met. No matter what type of business you are in, all customers want the same thing. They want

to feel welcomed and appreciated by you and your staff. They don't want to get the impression

that they are just being used by you for money.

A business is a measure of how products and services supplied by a company meet or surpass

customer expectation. It is seen as a key performance indicator within the business in a



competitive market place where business can compete satisfaction is a seen as a key

differentiator and increasingly has become a key element of business strategy. Customer

satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of

satisfaction will vary from person to person and service to service. The state of satisfaction

depends on a number of both psychological and physical variables Th e bank ing indust ry like

many other financial service industries is facing a rapidly changing market, new

technologies, economic uncertainties, fierce competition and more demand ing customers and

the chang ing c limat e has presen ted an unprecedented s et of challenges. Customer

loyalty is much harder to obtain than satisfaction. Even though customers are satisfied with the

company there are several factors that could cause the customer to defect to the competition,

such as finding a better value or the competitor is more convenient. With that said, having high

levels of customer satisfaction does not always lead to customer loyalty. However, a company

cannot achieve customer loyalty without having customer satisfaction. Thus, though customer

satisfaction does not guarantee the repurchase from a company but it does play a very important

role in achieving customer loyalty. Conducting customer satisfaction research will provide yourcompany with the necessary insight it needs to make informed decisions in order to retain and

increase your customer base and improve customer relationships.(1)

Measuring customer satisfaction

Organizations need to retain existing customers while targeting non-customers. Measuring

customer satisfaction provides an indication of how successful the organization is at providing

products and/or services to the marketplace.

Customer satisfaction is an abstract concept and the actual manifestation of the state of

satisfaction will vary from person to person and product/service to product/service. The state of

satisfaction depends on a number of both psychological and physical variables which correlate

with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also

vary depending on other factors the customer, such as other products against which the customer

can compare the organization's products.

Importance in banking sector

There are number of reasons why customer satisfaction is important in banking sector.

1. Meeting the needs of the customer is the underlying rationale for the existence of

community service organizations. Customers have a right to quality services that deliver

outcomes.



2. Organizations that strive beyond minimum standards and exceed the expectation of their

customers are likely to be leaders in their sector.

3. Customers are recognized as key partners in shaping service development and assessing

quality of service delivery.

4. In the organised segment, banking system occupies an important place in nation‟secono

my. It plays a pivotal role in the economic development of a country and forms the core

of the money market in an advanced country.

BENEFITS OF CUSTOMER SATISFACTION

Feedback

Customer feedback in the form of answers, comments and suggestions about a company's

products, business practices and customer service is one of the major benefits of a customer

satisfaction survey.

Desired Improvements

If feedback is critical or negative on any aspect, quick measures can be taken to bring about the

desired improvements or address grievances and placate relevant customers.

Better Innovation

Analysis of customer feedback surveys and the information collected becomes the basis for

customer intelligence. Used strategically, such intelligence can be used to drive innovation

efforts and initiatives at the company.

Greater Customization

A customer satisfaction survey also shows critical insights about different customer segments

and products so that services and marketing approaches can be tailored accordingly.

Long-Term Relationship

Customer satisfaction surveys enable companies to consistently and better address customer

needs and expectations, maintain brand reputation and facilitate long-term relationships withcustomers.

Sometimes companies are misguided by the notion that customers depend on them. The truth of

the matter is that we very much so depend on them. Many researchers and academia have

highlighted the importance of customers in today‟s market.



The level of satisfaction a customer has with a company has profound effects. Studies have

found that the level of customer‟s satisfaction has a positive effect on profitability:

A totally satisfied customer contributes 26 times as much revenue to a company as a

somewhat satisfied customer.

A totally satisfied customer contributes 17 times as much revenue as a somewhat

dissatisfied customer.

A totally dissatisfied customer decreases revenue at a rate equal to 18 times what a totally

satisfied customer contributes to a company.

Process of customer satisfaction.

• Step 1 – Understanding Customer Expectations

• Step 2- Promises to Customers

• Step 3 – Execution

• Step 4 - Ongoing Dialog with a Customer

• Step 5 - Customer Satisfaction Surveys

IMPORTANCE OF CUSTOMER SATISFACTION

I. To delivers excellent quality

Our core business is to deliver excellent service – for any product, at any time, at any place. We

provide worldwide door-to-door services ('old integrator') as well as comprehensive solutions

('new integrator'). We improve our services based upon the demands of our customers in our

national and international markets. We continuously challenge and improve our structures and

production processes.

II. To make our customers successful

Customer satisfaction determines our Group's success. Our customers' success is our success.We have the best possible knowledge of customers, markets and competitors and are therefore

the standard setters in the market. Our activities are governed by our knowledge of the global

and local requirements of our customers and markets.

III. To foster openness



We think global, act local and respect different cultural values in the countries where we operate.

Being open helps us to promote integration and, in turn, the success of the Group. We make

decisions based on facts and analyses. To do so, we use the combined knowledge of our Group

in all our locations and units and the expertise of all our employees at all times. We learn from

successes and failures, from internal and external best practices, from every single employee.

IV. To act according to clear priorities

1. The success of our customers

2. The success of our Group

3. The success of each organizational unit and the success of each individual

V. To act in an entrepreneurial way

Entrepreneurial conduct constitutes the spirit of our Group. We demand and promote individual

responsibility. Excellent people are key to our success. We welcome motivated and loyal

employees who strive for top performance. It is one of our core tasks to attract, develop and

retain such employees in the long term.

VI. To act with integrity internally and externally

Integrity determines the way we work within the Group as well as our conduct toward our

business partners, shareholders and the general public. Each employee has the opportunity for personal development according to individual performance independent of gender, religion or

culture. We do not tolerate discrimination. Each executive respects each employee's personal

dignity and personality within his staff and is responsible for creating an atmosphere of mutual

trust within the team. Executives delegate tasks effectively; however, they remain responsible

for the results (2)

Kotler Philip, Keller Lane Kvin “Marketing Management”.12th

edition Pearson

Education P.No. 117,118,121.(1)



Kotler Philip, Koshy Abraham, “Marketing Management” 13th

Edition Pearson

Education P.No. 115,116,120.(2)

MEANING OF RESEARCH Research comprises” creative work undertaken on a systematic basis in order to increase the

stock of knowledge, including knowledge of man ,culture, society, and the use of this stock of

knowledge to devise new applications .It is a way to systematically solve the research problem .it

may be understood as a science of studying how research is done scientifically the scope of

research methodology is wider than that of research methods. When we talk of research

methodology we not only talk of research methods we use in the context of our research study

and explain why we are using a particular method. A research is purely and simply theframework and plan the study that guides the collection and analysis of data .(3)

OBJECTIVES OF THE STUDY:

To know the lending practices of MUCB.

To study the impact of size on the efficiency of the MUCB.

To know different type of loans preferred by different sets of customers.

To know the satisfaction level of the customers from Bank‟s lending policies.

SCOPE OF THE STUDY:

1. The research will bring to light the perception of customers regarding the awareness and

demand of various services presently offered by MUCB.



2. The study is limited to the customers of Jaipur only.

3. This study will help us to understand customers, preference and their needs, and it will

help to improve the standard of service.

4.

The study will be able to reveal the banking services. It also help s banks to know

whether the existing products or services which they are offering are really satisfying the

customer needs.

RESEARCH DESIGN:

A research design is the arrangement of conditions for collection and analysis of data in a

manner that aims to combine relevance to the research purpose with economy in procedure it is a

process of systematic study. A research design is a systematic plan to study a scientific problem.

the design of a study defines the study type (descriptive, experimental) research design is the

framework that has been created to seek answers to research questions.

Descriptive research is used in this research in order to identify the lending practices of malviya

urban cooperative bank determining customer‟s level of satisfaction.

Descriptive research is also called statistical research the main goal of this type of research is to

describe the data and characteristics about what it is studied the idea behind this type of research

is to study averages and other statistical calculations. Descriptive research is the exploration of

the existing certain phenomena.

COLLECTION OF DATA

Primary Data

Primary data are those collected by the investigator himself for the first time and thus they are

original in character, they are collected for a particular purpose.

A questionnaire was used to the selected sample to collect the primary data.

Secondary Data

a. Books

b. Internet

SAMPLING

Sampling Unit: The Study population includes the customers of bank and Sampling Unit for

Study was Individual Customer.



Sampling Size: 50 Respondents

Sampling Area: Jaipur

REVIEW OF LITERATURE

Estiri, Hosseini, Yazdani, and Nejad (2013) performed a review of the set of attributes capable of

being incorporated in the measure of customer satisfaction for banks. Later, the possibility was

posed of grouping these attributes into dimensions of quality and testing their reliability and

validity.

Ganguly and Roy (2012) studied the factors affecting customer satisfaction in the Indian banking

sector; Questionnaire developed to determine the factors for customer satisfaction was

distributed among the respondents.the dimensions were identified using a exploratory factor

analysis. The paper identifies four generic dimensions in the technology, convenience, and

technology convenience, easiness, reliability.

Chander and Chandel (2011) analyzed the financial efficiency and viability of HARCO Bank

and found poor performance of the bank on capital adequacy, liquidity, earning quality and the

management efficiency parameters.

Singla (2010) emphasized on financial management and examined the financial position of

sixteen banks by considering profitability, capital adequacy, debt-equity and NPA (4)

Dutta and Basak (2008) suggested that Co-operative banks should improve their recovery

performance, adopt new system of computerized monitoring of loans, implement proper

prudential norms and organize regular workshops to sustain in the competitive bankingenvironment

. (3)

Pal and Malik (2007) investigated the differences in the financial characteristics of 74 (public,

private and foreign) banks in India based on factors, such as profitability, liquidity, risk and

efficiency. it is suggested that foreign banks were better performers, as compared to other

category of banks, in general and in terms of utilization of resources in particular.(5)

Ganguly.S,& Roy,S.K. (2011). Generic technology-based service quality dimensions in banking:

impact on customer satisfaction and loyalty. International journal of bank marketing, 292(2),168.

Campbell (2007) focused on the relationship between nonperforming loans (NPLs) and bankfailure and argued for an effective bank insolvency law for the prevention and control of NPLs

for developing and transitional economies as these have been suffering severe problems due to

NPL

Singh and Singh (2006) studied the funds management in the District Central Co- operative

Banks (DCCBs) of Punjab with specific reference to the analysis of financial margin. It noted



that a higher proportion of own funds and the recovery concerns have resulted in the increased

margin of the Central Co-operative Banks and thus had a larger provision for non-performing

assets.

Mavaluri, Boppana and Nagarjuna (2006) suggested that performance of banking in terms of

profitability, productivity, asset quality and financial management has become important tostable the economy. They found that public sector banks have been more efficient than other

banks operating in India.

Edwinraj (2005) [31] described the role of information technology in co-operative banks. The

information technology in cooperative banks plays a significant role in establishing and

maintaining contact with potential customers.

Hebbar Raveendranath (2004) [29] described that the advancements in computing and telecom

have revolutionised the financial industry. Banks are developing alternative mchannels of

delivery like ATM, telebanking, remote access, internet banking etc., Some questions that needto be answered are , how can one trust these channels, our personal data and transactions which

are driven by technology

LIMITATIONS OF THE STUDY

1. The data for study mainly based on a single bank

2. Questionnaire is the major limitation for the project.3. The time period of the research was limited. .4. Study is limited to concept of lending practices cooperative bank.

5. The information collected from 50 respondents only.

6.

The responses given by the respondents may not be true7. It was difficult to find respondents as they were busy in their schedule.

8. Collection of data was very difficult therefore study is based on availability of

respondents.



Dutta Uttam and Basak Amit (2008), “Appraisal of Financial Performance of urban cooperative

bank – a Case Study The management accountant, case study, March 2008, pg -170-174.(3)

Harish Kumar Singla (2008), “Financial performance of banks in India”, The ICFAI Journal of

Management, Vol. 5, Issue 1(4)

Ved Pal & N S Malik (2007),"A multivariate analysis of the financial characteristics of

commercial banks in India", The ICFAI Journal of Management, Vol. 6, Issue 3. (5)



CHAPTER -3 PROFILE

CO-OPERATIVE BANKS:

Co-operative banks are small-sized units organized in the co-operative sector which operate both

in urban and non-urban centers. These banks are traditionally centered communities, localities

work place groups and they essentially lend to small borrowers and businesses. 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, until 1996, could only lend for non-

agricultural purposes However, today this limitation is no longer prevalent. While the co-

operative banks in rural areas mainly finance agricultural based activities includingfarming, cattle, milk, hatchery, personal finance, etcetera, along with some small scale industries

and self – employment driven activities, the co-operative banks in urban areas mainly finance

various categories of people for self-employment, industries, small scale units and home finance

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.

Cooperative societies Act, 1965.These banks provide most services such as savings and current

accounts, safe deposit lockers, loan or mortgages to private and business customers. For middle

class users, for whom a bank is where they can save their money, facilities like Internet banking

or phone banking is not very important .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.

Therefore, these banks do not focus on offering more than the basic banking services. So, co-

operative banks finance small borrowers in industrial and trade sectors, besides professional and

salary classes .Co-operative banks differ from stockholder banks by their organization, their

goals, their values and their governance. In most countries, they are supervised and controlled by



banking authorities and have to respect prudential banking regulations, which put them at a level

playing field with stockholder banks. Depending on countries, this control and supervision can

be implemented directly by state entities or delegated to a co-operative federation or central

body.

Even if their organizational rules can vary according to their respective national legislations, co-operative banks share common features:

Customer-owned entities:

In a co-operative bank, the needs of the customers meet the needs of the owners, as co-operative

bank members are both.

As a consequence, the first aim of a co-operative bank is not to maximize profit but to provide

the best possible products and services to its members. Some co-operative banks only operate

with their members but most of them also admit non-member clients to benefit from their

banking and financial services.

Democratic member control:

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 ³one person, one vote .‡

Profit allocation:

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. Profit is usually allocated to members either through a patronage

dividend, which is related to the use of the co-operatives products and services by each member,

or through an interest or a dividend, which is related to the number of shares subscribed by each

member. 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, as their members and management board usually belong to the communities in

which they exercise their activities. By increasing banking access in areas or markets where

other banks are less present farmers in rural areas, middle or low income households in urban

areas - co-operative banks reduce banking exclusion and foster the economic ability of millionsof people. They play an influential role on the economic growth in the countries in which they

work in and increase the efficiency of the international financial system. Their specific form of

enterprise, relying on the above-mentioned principles of organization, has proven successful both

in developed and developing countries .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 cooperative, the expectations the co operative is



supposed to fulfill, their number, and the number of offices the cooperative bank operate Though

the co operative movement originated

HISTORY OF CO-OPERATIVE BANKING

The origins of the 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. Now, Co-operative movement is quite well established in India. The first legislation

on co-operation was passed in 1904. In 1914 the Maclagen committee envisaged a three tier

structure for co-operative banking viz. Primary Agricultural Credit Societies (PACs) at the grass

root level, Central Co-operative Banks at the district level and State Co-operative Banks at state

level or Apex Level. In the beginning of 20th century, availability of credit in India, more

particularly in rural areas, was almost absent. Agricultural and related activities were starved oforganised, institutional credit. The rural folk had to depend entirely on the co-operative banks

arrived in India in the beginning of 20th

Century as an official effort to create a new type of

institution based on the principles of co-operative organisation and management, suitable for

problems peculiar to Indian conditions. These banks were conceived as substitutes for money

lenders, to provide timely and adequate short-term and long-term institutional credit at

reasonable rates of interest, money lenders who lent often at usurious rates of interest.

The Anyonya Co-operative Bank in India is considered to have been the first co-operative bank

in Asia which was formed nearly 100 years back in Baroda. It was established in 1889 with the

name Anyonya Sahayakari Mandali Co-operative Bank Limited, with a primary objective of providing an alternative to exploitation by moneylenders for Baroda's residents. In the formative

stage Co-operative Banks were Urban Co-operative Societies run on community basis and their

lending activities were restricted to meeting the credit requirements of their members. The

concept of Urban Co-operative Bank was first spelt out by Mehta Bhansali Committee in 1939

which defined on Urban Co-operative Bank. Provisions of Section 5 (CCV) of Banking

Regulation Act, 1949 (as applicable to Co-operative Societies) defined an Urban Co-operative

Bank as a Primary Co-operative Bank other than a Primary Co-operative Society was made

applicable in 1966. With gradual growth and also given Philip with the economic boom, urban

banking sector received tremendous boost and started diversifying its credit portfolio. Besides

giving traditional lending activity meeting the credit requirements of their customers they startedcatering to various sorts of customers viz. self -employed, small businessmen / industries, house

finance, consumer finance, personal finance etc.

Urban Co-operative Banks:



Urban Co-operative Banks is also referred as Primary Co-operative banks by the Reserve Bank

of India. Among the non-agricultural credit societies urban co-operative banks occupy an

important place. This bank is started in India with the object of catering to the banking and credit

requirements of the urban middle classes.

Urban Co-operative banks mobilize savings from the middle and lower income groups and purvey credit to small borrowers, including weaker sections of the society. These banks organize

on a limited liability basis; generally extend their area of operation over a town. The main

functions of these banks are to promote thrift by attracting deposits from members and non-members and to advance loans to the members. It is registered under Co-operatives Societies Act

of the respective state Governments. Prior to 1966, Urban Co-operative banks were exclusively

under the purview of State Government. From March 1, 1966 certain provisions of BankingRegulation Act have been made applicable to these banks. Consequently, RBI became the

regulatory a supervisory authority of Urban Co-operative Banks for their related operations.

Managerial aspects of such banks continue to remain with State Governments under the

respective Cooperative societies act. These banks with multi-presence are regulated by theCentral Governments and registered under Multi-State Co-operative Societies Act. The RBI

extends refinance to Urban Co-operative Banks at bank rate against their advances to tiny andcottage industrial units. These banks grants sizeable loans and advances under priority sector for

lending to small business enterprises, retail trade, road and water transport operators and professional and self-employed persons. Urban Co-operative banks are mostly located in towns

and cities and cater to the credit requirement of the urban clientele.(7)

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 & landings of Cooperative Banks in India is muchmore 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 local reach,

personal interaction with customers, and their ability to catch the nerve of the local clientele.

There are two main categories of the co-operative banks are:

a) Short term lending oriented co-operative Banks

In this category there are three sub categories of banks viz. state co-operative banks, District co-

operative banks and Primary Agricultural co-operative societies.

b) Long term lending oriented co-operative Banks

In the second category there are land development banks at three levels state level, district level

and village level.

The cooperation banking structure is divided into following five categories



1. Primary urban cooperative bank

2. Primary agriculture credit societies

3. District central cooperation bank

4. State cooperative bank

5. Land development bank

Primary urban cooperative bank.

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 centered on communities, localities work place groups. They essentially lent to

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

Malviya urban cooperative bank (MUCB).

The Malviya Urban Co-operative Bank Ltd., Jaipur is registered under the Rajasthan Co-

operative Societies Act 1965 dated 28.08.1999 vide registration number 269/LC having its

registered office at Jaipur. The date of commencement of business was 24.01.2000, as the license

to carry on banking business had been issued by R.B.I. vide no. UBD. Rajasthan 0003 (P) dated

29.10.1999. Since commencement of its business from January 2000 the bank is running as a

profitable entity. Malviya Urban Co-Operative Bank Ltd. is a credit co-operative society,

initially registered under Rajasthan Co-operative Society Act 2001. Malviya Urban Co-Operative

Bank Ltd. strictly abides by the state cooperative societies act. Society is not a personal

institution owned by an individual. But is a fully democratic organization managed by the

„Board of Directors‟ who are elected by the members of the society in the Annual General

Meeting and the Board of Directors take decisions unanimously with total transparency. More

so, the Department of Co-operative of the Central Government constantly reviews the

functioning of the society at regular intervals. Co-operative banks are small-sized units organized

in the cooperative sector which operate both in urban and non-urban regions. These banks are

traditionally centered on communities, localities and work place groups and they essentially lend

to small borrowers and businesses. 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, until 1996, could only lend for non- agricultural purposes. As at end-March 2011,

there were 1,645 UCBs operating in the country, of which majority were non- scheduled UCBs.

Moreover, while majority of the UCBs were operating within a single State, there were 42 UCBs

having Operations in more than one State. However, today this limitation is no longer prevalent.

While the co-operative banks in rural areas mainly finance agricultural based activities including

farming, cattle, milk, hatchery, personal finance, etc. along with some small scale industries and



self-employment driven activities, the co-operative banks in urban areas mainly finance various

categories of people for self-employment, industries, small scale units and home finance. These

banks provide most services such as savings and current accounts, safe deposit lockers, loan or

mortgages to private and business customers. For middle class users, for whom a bank is where

they can save their money, facilities like Internet banking or phone banking is not very

important. Although they are not better than private banks in terms of facilities provided, their

interest rates are definitely competitive. (6)

BOARD OF DIRECTORS

Sh. Ram Prasad Agarwal Chairman

Sh. Mohan lal Sharma Vice chairman

Dr. Urmila Sharma Director

Sh. Gaurav Gupta Director

Smt. Munni devi Nagori Director

Sh. Mohan Singh Director

Smt. Richa Agarwal Director

Smt. Rimpy Sharma Director

Sh. Virendra Singh Director

Smt. Sarita Sharma Director

Smt. Sweety Agarwal Director

Shri. N.L. Sharma Advisor

Mr. Sanjeev Sharma Managing Director

Mr. Pawan Sharma General Manager

Mr. Virendra Singh Chief Manager

Mr. Ram Naresh Sharma Deputy General Manager

Ms. Madhu Singh Khangaroth Senior ManagerMr. Nirmal tailor Manager

Vision of the Malviya Urban Co-operative bank

Primarily, to raise funds for lending money to its members.

To attract deposits from members as well as non-members.

To encourage thrift, self-help ad mutual aid among members.

To draw, make, accept, discount, buy, sell, collect and deal in bills of exchange, drafts,

certificates and other securities.

Annual business plan (annual action plan) for 2014-2015

The following annual business plan (annual action plan) was approved by the board of directors

for the year 2014-2015 ending 31st march 2015.

1. To enroll 192 new members so as to reach the membership at 4550.



2. To increase share capital to get the level of 320lac as on 31.03.2015.

3. To increase loans and advances up to the level of rs.6000lac.

4. To increase the deposits of bank so as to reach to the level of rs.10200lac.

5. To increase the working capital by 12000lac.

6. To organize customers meet.

PRODUCTS:

MUCB has various products for the customers like Deposits, and Loans. When we say about the

deposits the MUCB has the following accounts Current account, saving bank account, Term

deposit, bank further has the following schemes like fixed deposits. It includes different types of

loan schemes. Currently the MUCB bank has many loans schemes. Like personal loans, home

loans, vehicles loans, Education loans etc.



IMPORTANCE OF CO-OPERATIVE BANKING

Co-operative bank forms an integral part of banking system in India. This bank operates mainlyfor the benefit of rural area, particularly the agricultural sector. Co-operative bank mobilize

deposits and supply agricultural and rural credit with the wider outreach. They are the main

source for the institutional credit to farmers. They are chiefly responsible for breaking the

monopoly of moneylenders in providing credit to agriculturists. Co-operative bank has also been

an important instrument for various development schemes, particularly subsidy-based

programmes for the poor. Co-operative banks operate for non-agricultural sector also but their



role is small. Though much smaller as compared to scheduled commercial banks, co-operative

banks constitute an important segment of the Indian banking system. They have extensive branch

network and reach out to people in remote areas. They have traditionally played an important

role in creating banking habits among the lower and middle income groups and in strengthening

the rural credit delivery system.

STRENGTH AND WEAKNESS OF COOPERATIVE BANKS:

The main weaknesses of co-operative banks are as follows:

i. The vital link in the co-operative credit system namely, the Primary Agricultural Co-

operative Societies, themselves remain very weak. They are too small in size to be

economical and viable; besides too many of them are dormant, existing only on

paper.ii. With the expanding credit needs of the rural sector, the commercial banks have come

in actively to meet the credit requirements of this sector, and this has aggravated the

difficulties of co-operative banks.iii.

Most of the Co-operative banks are suffering from the lack of professional

management. In the deregulated environment and stiff competition in the banking

sector, due to lack of the professionalism in carrying out banking activities, the

weakness of these banks has become more prominent.iv. Many co-operative banks even now continue to follow age-old system and

procedures, which are not conductive in the present technologically driven banking

environment. Except some Co-operative banks, technological development inInformation Technology or computerized data management is conspicuously absent.

v. Another problem arises out of the duality of control over them i.e. these banks are

organized under dual control of RBI and as well as respective state government.Apart from the intervention of the apex bodies, the Government is also found to

exercise control in various ways on these banks. Government intervention in the

management, administration and business operation of co-operative banks has made

the institution lose his own distinct character .(8)

OPERATION OF COOPERATIVE BANK

i. Co-operative bank performs all the main banking functions of deposit mobilisation,

supply of credit and provision of remittance facilities.

ii.

Co-operative Banks belong to the money market as well as to the Capital market.iii. Co-operative Banks provide limited banking products and are functional specialists in

agriculture related products

iv. UCBs provide working capital loans and term loan as well.

THE FUNCTIONS OF COOPERATIVE BANK



a. To attract deposit from non-agriculturist.

b. To use excess funds of some societies temporarily to make up for shortage in another.

c. To supervise and guide affiliated societies.

ROLE OF CO-OPERATIVE BANK

Co-operative Banks are much more important in India than anywhere else in the world. The

distinctive character of this bank is service at a lower cost and service without exploitation. It has

gained its importance by the role assigned to them, the expectations they are supposed to fulfill,

their number, and the number of offices they operate. Co-operative banks role in rural financing

continues to be important day by day, 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 rural areas, as far as the agricultural and related activities are concerned, thesupply of credit was inadequate, and money lenders would exploit the poor people in rural areas

providing them loans at higher rates. So, Co-operative banks mobilize deposits and purvey

agricultural and rural credit with a wider outreach and provide institutional credit to the farmers.

Co-operative bank have also been an important instrument for various development schemes,

particularly subsidy-based programmes for poor .

The Co-operative banks in urban areas finance in activities like:

• Self -employment

• Industries

• Small scale units

• Home finance

• Consumer finance

• Personal finance



www.mucb.com(6)

www.urbancooperativebank.com(7)

www.rbi,org.in(8)

http://www.mucb.com/


http://www.urbancooperativebank.com/

http://www.rbi%2Corg.in/







Table 1: Preferences of the customers for the loans

Kind of loan No. of respondents Percentage (%)

House loan 12 24

Personal loan 10 20

Consumer loan 8 16

Educational loan 9 18

Vehicle loan 6 12

Other 5 10

Total 50 100

Figure 1: Preference of kinds of loan

INFERENCE

Present study reveals that majority of the respondents have taken house loans & personal loans

and less respondents prefer consumer, educational and vehicle loans.

24%

20%

16%

18%

12%

10%

No. of respondents

House loan Personal loan Consumer loan

Educational loan Vehicle loan Other



Table 2: Range of the amount of loans

Loan amount No. Of respondent Percentage (%)

Less than 20000 11 22

20000-50000 26 52

50000-100000 10 20

More than 1 lakh

3 6

Total 50 100

Figure 2: Range of the amount of loans

INFERENCE

22%

52%

20%

6%

No. Of respondent

Less than 20000 20000-50000 50000-100000 More than 1 lakh



Present Study reveals that 22% people prefer loan less than 20,000, 52 % respondents prefer

20,000 to 50,000,20% prefer more than 1 lakh and 6% of the respondents prefer more than 1

lakh.

Table 3: Preferable term of loan

Term of loan No. of respondent Percentage (%)

Less than 1 year 7 14

1 to 3 years 13 26

More than 3 years 30 60

Total 50 100

Figure 3: Terms of loan.

INFERENCE

14%

26%

60%

No. of respondent

Less than 1 year 1 to 3 years More than 3 years



Study shows that 60% respondents take loan for more than 3 years, 26 % take loan for 1 to 3

years and 14% take loan for the period of less than 1 year.

Table 4: What prompted the customers to take loan from cooperative banks?

Reason for taking loan No. of respondents Percentage (%)

Reasonable rate of interest 6 12

More schemes 17 34Less formalities 9 18

Easy repayment 10 20

Any other 8 16

Total 50 100

Figure 4: What prompted the customers to take loan from cooperative banks

INFERENCE

12%

34%

18%

20%

16%

No. of respondents

Reasonable rate of interest More schemes Less formalities

Easy repayment Any other



34% take loans because of more schemes and other respondents take loan because of reasonable

rate of interest, and less formalities. Study reveals that 20% take loan because banks provide

easy repayment.

Table 5: Average time taken for the processing of the loan

Average time for processing

of loan

No. of respondent Percentage (%)

Less than 7 days 35 70

Between 7 to 14 days 10 20

More than 14 days

5 10

Total 50 100

Figure 5: Average time taken for the processing of the loan

70%

20%

10%

No. of respondent

Less than 7 days Between 7 to 14 days More than 14 days



INFERENCE

Study reveals that 70% respondents says that average time taken for processing of the loan is less

than 10 days, 20% says that it takes 7 – 14 days and 10 % says that it takes more than 14 days.

Table 6. Ranking of the facilities provided by the cooperative banks.

Rank the facility No. of respondent Percentage (%)Above average 32 64

Average 11 22

Below average 7 14

Total 50 100

Figure 6: Ranking of the facilities provided by the co-op. banks

INFERENCE

64%

22%

14%

No. of respondent

Above average Average Below average



Study shows that 22% of the respondent says that facility provided by the bank are average,

64% say that its above average and 14% says that its below average.

Table 7: Customer’s ranking for service of the bank

Rank the customer services No. of respondent Percentage (%)

Excellent 25 50

Good 15 30

Average 7 14

Poor 3 6

Total 50 100

Figure 7: Customer‟s ranking for service of the bank

INFERENCE

50%

30%

14%6%

No. of respondent

Excellent Good Average Poor



Study shows that 30% of the respondents says that customer service of the bank is good 50%

says that it is excellent and another 14 % says its average and only 6 % says it‟s poor.

Table 8: Customers who would like to refer the co-op. banks to their friends and relatives.

Bank refers to others No. of respondent Percentage (%)Always 34 68

Sometimes 10 20

Never 6 12

Total 50 100

Figure 8: Customers who would like to refer the co-op. banks to their friends and relatives

INFERENCE

68%

20%

12%

No. of respondent

Yes No Can’t say



68 % of the respondents would like to refer the bank to their friends and relatives which shows

that they are satisfied from the services and lending practices of the bank.

Table 9: Satisfaction of the customers with the amount and period of installment.

No. of respondent Percentage (%)

Yes 28 56

No 22 44Can‟t say 10 20

Total 50 100

Figure 9: Satisfaction of the customers with the amount & period of installment

INFERENCE

Study reveals that 56% are satisfied with the amount and period of installment, 44 % are not

satisfied and 20 % can‟t say.

56%

44%

20%

No. of respondent

Yes No Can‟t say



CHAPTER -5

FINDINGS



FINDINGS

Majority (32% as per the study) of the respondent were having housing loan from this bank

Most (64% as per the study) of the people prefer to take long term loan which is more

than 3 years.

There is a very simple procedure followed by bank for loan

Easy repayment and less formality are the main factors determining customer‟s selection

of loans.

Quality of services provided by the staff is satisfactory because bank is catering to asmall segment only and the customers are properly dealt with.

Customers are satisfied with the mode of repayment of installments.

Average time for the processing of loan is less i.e. approx 7 days.

Most of the respondents are satisfied with the service offered by malviya urban

cooperative bank.

The reason can be increasing customer satisfaction and quality services offered by

malviya urban cooperative bank.

Majority of the respondents rates good, very good, and excellent because of the customer

service offered by the bank.



SUGGESTIONS

The COOPERATIVE BANKS should adopt the modern methods of banking like internet

Banking, credit cards, ATM, etc.

The MUCB should plan to introduce new schemes for attracting new customers and

satisfying the present ones.

The MUCB should plan for expansion of branches.

The MUCB should improve the customer services of the bank to a better extent.

MUCB should adopt effective promotional strategies to increase the awareness level

among the consumers.

MUCB should ask their customers feedback to know whether the consumers are reallysatisfied or dissatisfied with the service and the product of the bank .if they are

dissatisfied then the reasons for dissatisfaction should be found out and should be

corrected in future.



MUCB should work hard to maintain its position and offer better service and products to

consumers.

CONCLUSION

Presently, the urban cooperative banks occupy an important place in the Indian financial system.

Majority of the people prefer to take long term loan which is for 3 years .they showed preference

for personal business and house loan, firstly the corporation should target the existing customer

base and try to increase their awareness levels. Then they should make the other customer of the

bank at least aware of the various schemes so that the next stage of interest, desire and action

becomes easy to execute. Bank should look to open new branches with proper planning &careful

selection of location, which is convenient to the target customer especially in places where there

are a lot of options in front of the consumers. Malviya urban cooperative bank will learn from the

present experiences and adjust to new realities since banking is risky business .In future the



urban cooperative banks are ready to face many challenges in the competitive environment. The

cooperative banks are best vehicles for taking banking to doorsteps of common men, unbanked

people in rural and urban areas. Without the help of cooperative banks, people would be lacking

the much needed financial support. These banks are sure to win in the race because they are from

the people ,by the people, and of the people.



BIBLIOGRAPHY Books:

Kothari C.R. Research Methodology Methods & Techniques, Revised Second Edition(New age international publishers), 2013.

Kotler Philip, Keller Lane Kvin “Marketing Management”.12th

edition Pearson Education

P.No. 117,118,121.

Sudha G.S. (2012-2013), Human Resource Management, RBD Publications.

Kumar Arun, Minakshi N. “Marketing Management”Vikash Publication 1st Edition 2006.

P.No. 213, 214.

Bhasak Amit,”Cooperative Banks in India- Functioning and Reforms “New Century

Publications, 2010.

Kotler Philip, Koshy Abraham, “Marketing Management” 13th

Edition Pearson Education

P.No. 115,116,120.

Nakkiran.S “Co-operative Banking in India “Rainbow Publications, 2007.

Websites

www.mucb.com

www.urbancooperativebank.com

www.rbi,org.in












REFERENCES

Chander and Chandel (2012) Financial Viability of an apex cooperative credit institutionVol. VI, No.2, April-June 2010, pg 61-70.

Dutta Uttam and Basak Amit (2011), “Appraisal of Financial Performance of urban

cooperative bank – a Case Study The management accountant, case study, March 2008,

pg -170-174.

Harish Kumar Singla (2010), “Financial performance of banks in India”, The ICFAI

Journal of Management, Vol. 5, Issue 1.

Ved Pal & N S Malik (2007),"A multivariate analysis of the financial characteristics of

commercial banks in India", The ICFAI Journal of Management, Vol. 6, Issue 3.



Ramesha and Nagaraju (2007), "Prudential Standards and the performance of Urban Co-

operative Banks in India: An Empirical Investigation", The ICFAI Journal of Financial

Risk Management, June, (2007)

K.C., Shekhar and Lekshmy Shekhar (2007), Banking theory and practice, Nineteenth

edition, reprint 2007, Vikas publishing house Pvt. ltd. (India), Chapter: 16, pp. 356-374.

Ganguly.S, & Roy, S.K. (2011).Generic technology based service quality dimensions in

banking impact on customer satisfaction and loyalty. International journal of bank

marketing, 292(2), 168.

Annexure

Questionnaire

Personal data

Name:

Sex:



Age:

Marital status:

1. To which loan you will give more preference?

House loan

personal loan

consumer loan

educational loan

vehicle loan

other

2. Which range of the amount of loan you generally required?

Less than 20000

20000-50000 50000-1lac

More than 1lac

3. Your preferable term of loan is for?

Less than 1 year

1 to 3 years

More than 3 years

4. What prompted you to take loan from cooperative banks?

Reasonable rate of return Less formality

Easy repayment

More schemes

Other

5. According to you the average time taken for the processing of the loan by urban

cooperative bank is

Less than 7 days

Between 7 to 14 days

more than 14 days

6. Rank the facilities provided by Malviya urban cooperative bank

Above average

Average

Below average



7. Rank for service provided by Malviya urban cooperative bank.

Excellent

Good

.Average

Poor

8. Would you like to give reference of this cooperative bank to your friends and relatives? Always

Sometimes

Never

9. Are you satisfied with the amount and period of installment?

Yes

No

Can‟t say

Summer Training Report God

Documents

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