INTRODUCTION

A Cooperative Bank is a financial entity which belongs to its members, who are at the same time the owners and the customers of their bank. Co-operative Banks are often created by persons belonging to the same local or professional community or sharing a common interest.

● Waiver of Agriculture Loans. ● Credit Supply to Weaker Sections. ● Interest Reduction for Non-Farm Sector Loans. ● Jewel Loans. ● Kisan Credit Card Scheme.

● Micro Credit Facility. ● Assistance to Self Help. ● Women Entrepreneur Loan

Scheme. ● Professional Loan.

RURAL COOPERATIVE

CREDIT[1,07,497]

SHORT TERM

CREDIT [1,06,781]

SCBs [31]

DCCBS

[369]

PACS[1,06,384]

LONG TERM

CREDIT [716]

PCARDB

[696]

SCARDB

[20]

A cooperative farming society is a voluntary organization based on the ideas of self-help and mutual aid. It is primarily intended to benefit the small farmers and landless cultivators.

Functions of Agricultural Co-operative Credit Societies :-

1. These societies form the bulk of the co-operative credit organization of the district by providing loans to the farmers at reasonable rate of interest.

2. They have mostly a single village as their area of operation, but occasionally hamlets and small villages in the neighbourhood are also included.

3. Their main function is to provide financial accommodation of short term and intermediate term nature to their members for productive purposes.

4. They provide marketing facilities to the members for the sale of agricultural produce.

5. They associate itself with economic and social welfare programmes of the village.

Structure of PACS

Sources of Funds Rate of Interest Weakness and Problems of PACS

Functions of PACS

Objectives of PACS

Registration of PACS

Management of PACS

Membership and liability

Suggestions

FINANCIAL PERFORMA

NCE

ASSET QUALITY

AND RECOVERY PERFORMA

NCE

REGIONAL DIMENSIO

NS

FUNCTIONSOF THE SCBs

FINANCIALPERFORMANCE

REGIONAL DIMENSIONS

RURAL COOPERATIVE

BANKS-LONG TERM STRUCTURE, SPREAD

AND GROWTH

Operations

Financial Performance

Asset quality and Recovery Performance

Regional Dimensions

OPERATIONSREGIONAL DIMENSIONS FINANCIAL

PERFORMANCE

ASSET QUALITY AND RECOVERY PERFORMANCE

EMERGENCE OF LAND

DEVELOPMENT

HISTORY OF LAND

DEVELOPMENT BANKS IN

INDIA

CHARACTER OF LAND

DEVELOPMENT BANKS

STRUCTURE FUNDS INTEREST RATE

LOAN PROCEDURE

DEFECTS OF LAND

DEVELOPMENT BANKS

OBJECTIVE OF THE SCHEME

BENEFITS OF THE SCHEME

IMPLEMENTATION AND EVALUATION

Co-operative credit societies established in urban areas are

referred to as urban co-operative banks. In most states, however, no

clear-cut definition of an urban co-operative bank is statutorily followed.

Urban co-operative banks are confined to the municipal area

of a town. Urban Co-operative Banks are also called Primary Co-operative

Banks (PCBs) by the Reserve Bank.

● Customer Owned Entities.● Democratic Member Control.● Profit Allocation.● Rooted in Local Areas.● Financial Inclusion.● Limited Products.● Co-operative banks are Financial Intermediaries.● Money as Well as Capital Market Operation.● Subject to Reserve Ratios.● Interest Rates.

● UCBs are organized with the objective of promoting thrift and self-help among the middle class/lower middle class population;

● UCBs provide credit facilities to the people with small means in the urban/semi-urban centres;

● On account of their local feel and familiarity, UCBs are important for achieving grater financial inclusion;

● There is improvement in customer service and enhancement of business opportunities for urban middle class;

● Contribution towards Economic & Social Development;

● Credit to housing dominated priority sector;

● UCBs over the years have been playing a huge role for the development of small and medium enterprises;

● Provision of Women Entrepreneur Loans.

The National Bank of Agriculture and Rural Development was inaugurated in the month of November,1982. NABARD was set up in July 1982, by an Act of parliament. NABARD has taken over the functions of ‘Agricultural Refinance and Development Corporation’ and the refinancing functions of RBI in relation to co-operative banks and RRBs.

NABARD was set up as an apex body in the field of financing agricultural and rural development in order to integrate the financing of various institutions so that the development of rural areas is brought about speedily and in an organized manner.

The authorized share capital of NABARD is Rs.500 Crores and paid up is Rs.100 Crores(raised to Rs.2,000 Crores in the budget of 1998-99), contributed equally by the Central Government and the Reserve Bank.

NABARD has a dual role to play.

Firstly , as an apex institution. NABARD has taken over the apex role from RBI. i.e. it is performing all functions performed by RBI with regards to agriculture credit.

Secondly, NABARD has taken over the job of ARDC and thus provides refinance facilities to all banks and financial institution lending to agriculture and rural development.

Following are some of its functions :

1. NABARD works as an apex body to look after the credit requirement of the rural sector.

2. NABARD provides short term, medium term and long term credits to SCBs, RRBs, LDBs & other financial institutions approved by RBI.

3. It gives long term loans upto 20 years to state government to enable them to subscribe to the share capital of co-operative credit societies.

4. NABARD serves as a refinancing institution for all kinds of production and investment credit to agricultural and rural development ‘to any institution approved by the central government.

5. NABARD has the responsibility to inspect RRBs and co-operative banks.

6. It maintains a research & development fund to promote research in agriculture & rural development and makes programmes according to the requirement of different areas.

7. It has the responsibility of coordinating the activities of Central and State Government, the Planning Commission and other all India and State level institutions entrusted with the development of small scale industries, village and cottage industries, rural crafts, industries in the tiny sector, etc.

8. It provides short term credit to State Co-operative Banks for seasonal agriculture operations, marketing of crops, purchase and distribution of fertilizers and working capital requirements of co-operative sugar factories.

9. Offers training and research facilities for banks, cooperatives and organizations working in the field of rural development.

10. Help the state governments in reaching their targets of providing assistance to eligible institutions in agriculture and rural development.

11. Acts as regulator for cooperative banks and RRBs.

FLOW OF CREDIT TO WEAKER SECTIONS

RURAL INFRASTRUCTURE

DEVELOPMENT FUND

STRENGTHENING AND RE-ORGANIZING THE

CO-OPERATIVE STRUCTURE

THROUGH REFINANCING TO STATE COOPERATIVE BANKS, RRB, AND COMMERCIAL

BANKS

INTRODUCTION

The word audit is derived from the Latin word ‘Audire’ meaning to hear, as originally the Auditor merely used to ‘hear’ the accounts to pass the transactions as genuine or correct.

As per the Cooperative Society Act 1912 :

a) The Registrar shall audit, or cause to be audited, at least once in each co-operative year, by a person authorized by him by general or special order in writing in this behalf.

b) The audit shall include examination or verification of overdues of debts, valuation of the assets and liabilities of the society.

CORRECT REFLECTI

ON

ASCERTAINING FAIR VIEW OF

FINANCIAL STATE

DETECTION OF ERRORS & FRAUDS

ADHERENCE TO COOPERATIVE

PRINCIPLES

TO ASCERTAIN AUTHORITY

VERIFICATION OF FINANCIAL POSITION

CONCURRENT AUDIT INTERIM AUDIT TEST AUDIT FINAL/

STATUTORY AUDIT

EXAMINATION OF OVERDUE DEBTS

VERIFICATION AND VALUATION OF THE

ASSET AND LIABILITIES

EXAMINATION OF TRANSACTIONS

PROMPT ACTION

ASSESS LOSSES SUBMIT MEMORANDUM

● POWERS To discharges his duties an auditor of a cooperative society has been vested with the following powers :

❖ He has the power to audit any cooperative institution allotted to him by general or special order in writing made by the Registrar.

❖ Any officer, member, agent or servant of a society who fails to comply with the requirements of bylaws is an offender and punishable.

● LIABILITIES The Auditor can be held liable for negligence in the following matters :

❖ Omission to count the cash in hand and verify the Govt. and other securities by physical verification.

❖ Failure to verify and evaluate the assets shown in the balance sheet after making due enquiries.

❖ Failure to detect the frauds which have actually taken place during the periods of audit.

An audit programme is detailed plan of the auditing work to be performed, specifying the item in the financial statements and allocating tentative time required.

In general, the audit programme should contain the following points :

i. Examining regulations of the society (Bye-laws etc.) as they may have bearing on the system of accounts followed.

ii. Vouching cash received by way of share capital with reference to the Registrar of members and copies of the receipts issued to them.

iii. Vouching receipts from deposits, if any.

iv. Vouching grants from the Government, if any, with reference to the letter authorizing such grants.

v. Checking the loans borrowed from Banks.

● A co-operative society has to get its accounts audited annually by an auditor selected from the panel prepared by the Registrar in the prescribed manner within the period of sixty days from the close of co-operative year.

● Registrar is regarded competent to issue guidelines and instructions from time to time regards to auditing of overdue debts, verification of the cash balance, securities and a valuation of the assets and liabilities of the co-operative society.

● The Registrar is to ensure that the person auditing the accounts of a co-operative society shall have free access to the books, accounts, papers, vouchers, stock and other property of such co-operative society and shall be allowed to verify its cash balance and securities.

● In case of inquiry the Registrar may on the basis of findings of audit or inspection request from any creditor or not less than one-thirds of the total members of the co-operative society, by general or special order in writing in this behalf, hold an inquiry and such enquiry shall be completed within such period as may be specified in the ordr.

a) Registration of Cooperative Societies.

b) Registration of amendments in the Bye-laws of Cooperative Societies.

c) Amalgamation, Division and Re-organization of Cooperative Societies.

d) Ensure timely Election of the Managing Committee in Cooperative Societies.

e) Conduct elections of Managing Committee in primary cooperative banks and federal cooperative societies.

f) Ensure proper investments of funds by Cooperative Societies as per Act and Rules.

g) Settle disputes of Cooperative Societies through the process of arbitration.

I. No person shall be admitted as member of a co-operative society except the following, namely :

The firm, a joint stock company, or other body

corporate constituted under any law

An Individual competent

Any other co-operative society

The Government.

II. Provided that the provision of the Act shall not apply to an individual seeking admission to an a co-operative society exclusively formed for the benefit of students of a school or collage.

Provided further that no individual shall be eligible for admission as a member

of any financing bank

Every member of a co-operative society shall have one vote in the

affairs of the co-operative society.

THANK YOU!