BBA 5TH SEM.
‘A Bank is a financial institution that accepts deposits
from the public & creates loans.’
Structure of Banking in India:-
COMMERCIAL BANK CO-OPERATIVE BANK
A co-operative bank is an association of peoples. It is a
financial entity which belongs to it’s members, who are at the
same time the owners and 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 .
Co-operative banks generally provide their members with a
wide range of banking and financial services(loans,
deposits, banking accounts etc).
FEATURES OF CO-OPERATIVE BANKS
It is a “customer owned banking” .
It involves autonomous association of person united voluntarily
to meet their common economic, social, cultural needs through a
jointly owned & democratically controlled enterprise.
Co-operative banks are registered under the Co-operative
Societies Act, 1912.
It regulated by the RBI under the Banking Regulation Act, 1949
& Banking Laws (application to co-operative societies) Act, 1965.
They are organized & managed on the principle of co-operation,
self help & mutual help.
The major contribution of these banks are mostly in agriculture
& Rural sector as where they play the most vital role in Rural
financing & Micro financing.
Co-operative banks are also do banking business in urban and
Co-operative banks are government supported Financial
agency in India.
In India, co-operative banks are working for nearly 110 years.
Co-operative banks are work on “No Profit & No Loss” Model.
Profit maximization is not their goal.
The major function of co-operative banks are:-
a) Mobilization of funds from their members
b) Advance loans to the members ,other needy peoples & farmers in
the rural areas.
The co-operative banks function with the objective of fulfilling the
credit requirements and needs of people living in the Rural as well
as in the Urban areas.
Perform multiple & function at large extent to carryout developments
& regulations in the society that strengthen the co-operative
It perform all the main Banking functions of Deposits, Mobilization,
supply of credit & provision of remittance facilities.
It provides limited banking products & are functionally specialists in
Agriculture related products.
Co-operative banks in India finance Rural areas under:-
I. Farming cattle
III. Personal finance
Co-operative banks in India finance Urban areas under:-
III. Small scale units
IV. Home finance
V. Consumer finance
VI. Personal finance
a) Saving bank account
b) Current account
c) Recurring deposits
d) Fixed deposits
a) Loans to salaried
b) Home needs loans
c) Loan to pensioners
d) Education & housing loan
Safe deposits lockers
Demand draft/ pay order
History of CO-OPERATIVE
It was the idea of Hermann Schulze(1808-83) and Friedrich
Wilhelm Raiffeisen (1818-88) which took shape as co-operative
bank of today across the world.
In India, towards the end of the 19th century, the problem of
rural indebtedness & the consequent conditions of farmers
created an environment for the chit fund & co-operative
societies they found that it is an attractive mechanism for
pooling their meager resources for solving common problems
relating to credit, supplies of inputs & marketing of agricultural
produce. The experience gained in the working of co-operatives
led to the enactment of Co-operative Credit Societies Act,1912.
After India attained Independence in August, 1947, co-
operatives assumed a great significance in poverty removal &
faster Socio-economic growth.
Types of co-
• Primary co-operative banks:-These are formed at a village level or town level with
borrower & non-borrower members residing in one locality. Their operations
are restricted to small area.
• central co-operative banks:- These banks are operate at a district level having
some of the primary credit societies belonging to the same district as their
• state co-operative banks:- These banks are the apex co-operative banks in all
states of the country. It acts as a ‘Watchdog’ of the co-operative banking
structure in the state.
• land development banks:- These banks are meeting the long-term credit
requirements of the farmers for developmental purposes. They are situates in
the districts & tehsil areas in the state.
• urban co-operative banks(ucb’s):- These banks are refers to primary co-operative
banks located in urban and semi-urban areas. They essentially lend to small
borrowers and businesses.
Saraswat bank is an ‘Urban co-operative banking institution’
based in Maharashtra, India and operating as a co-operative
bank since 14 September 1918.
In 1988, the bank was conferred with “Scheduled” status by
RBI. The bank is the first co-operative bank to provide
merchant banking services.
It got a permanent license to deal in Foreign exchange in
1978. It has 283 branches nationwide.
‘Services to the common man ’ has been the motto of
Saraswat bank for the last 99 years.