ProjectLoans and Advances With Special Reference To D C S

Loans and advances with special reference to D C S
M.COM NIPGS SHIMOGA Page 1

CHAPTER 1
INTRODUCTION
In the beginning of the existence of an existence of human beings, needs were
simple in nature and every individual produced all that were necessary to sustain life. He
was produced his own food of animal flesh and vegetables. He has prepared his own
clothing and his own shelter.
After this stage, Barter system came into existence. In fact, Barter system refers to
trade with exchange of goods in the absence of money. Say for example, certain quantity
of Paddy is exchanged for the same quantity of Wheat. At this point of time, the concept
of dependency was emerged in the routine life of human beings. Due to their
dependency, the concept of co-operation was born.
In the course of time, people settled down in different occupations and with
specialisation, the exchange of goods became wider. The money was introduced in
trading which was widely accepted for payment. As money started getting importance,
co-operation was going hand in hand with it.
Therefore, co-operation is an important thing which plays an important role in all
types of goods and services and in settlement of debts. Money had given and received
without reference to the standing of the person who offers it in payment.
According to Dr. D.H Robertson money is anything which is widely accepted in
payment for goods or in discharge of other kind of business obligations". This is the
manner in which money has extended into the co-operation.



Statement of the problem and need for the study
In the current scenario, every co-operative society has to face keen competition
and challenges in the trading and commercial sector. Moreover, these have to work
responsibly along with transparency in accordance with the rules, regulations and
principles of the Co-operative Act. DURGIGUDI CO OPERATIVE SOCIETY has
completed its useful service of nine years, no attempt of making any project report on
this society have been made so as to make it clear about the attitude of customers in
respect of its operation. On this background, the present study could be essential to the
DURGIGUDI CO OPERATIVE SOCIETY for its further development.
Objectives of the study
A. To extends credit facilities or financial assistance to the members at reasonable
rate of interest.
B. To provide loans to increase agricultural production, animal husbandry, poultry
and agricultural equipments.
C. To provide loans to improve irrigation facilities to dry lands.
D. To provide co-operative education and publicity of society.
E. To border or extend facilities of co-operative society to its members.
Data Collection
The data which are collected for the preparation of this project report include:
a) Primary Data
b) Secondary Data
The primary data are collected through personal interview with the Chief
Executive Officer (CEO) DURGIGUDI CO OPERATIVE SOCIETY and with the
staff to obtain thorough information. The survey is conducted through questionnaire. In
fact, a questionnaire has been prepared and passed to the selected customers on the


random basis to avoid bias in the collection and analysis of data about the Durgigudi Co
Operative Society.
Sample Plan
The respondents for this study are the persons who are in connection with the
Durgigudi Co Operative Society Shivamogga. These persons are considered from the
different part of SHIVAMOGGA town.
Sample Size
The respondents in this study are the persons who are the customers of Durgigudi
Co Operative Society Shivamogga. The study is Initiatively planned to 50 respondents.
These respondents have been obtained through the random sampling method.
Scope of the study
This project report has been dealt with the various aspects relating to the
Durgigudi Co Operative Society Shivamogga. The study begins with the collection of
facts which determine how the concept of co-operation is born. It (I.e., the study) has
covered the various information relating to the types of deposits and credit facilities are
available In Durgigudi Co Operative Society Shivamogga and how much of the loans
provided has been recovered. For this purpose, the relevant data of the past five years
have been obtained and also the opinions of respondents have been analysed.
Data Analysis
Statistical tools like percentages, tables, charts are used for analysis and
interpretation of the collected data.



Limitations of the study
There has been certain limitations are found while preparing the project report.
They are as follows,
1. Members are selected on random basis. Therefore, they may not represent the
population.
2. Some members were remain fear to express their opinion about co-operative services.
3. The study entitles the limitation of time factor. Due to this limitation the project may
lacks in detailed information.
4. Only the data of past five years (Since the year 2008-09 to 2012-13) have been
obtained for the purpose of study.



CHAPTER-2
INDUSTRY PROFILE

INTRODUCTION
MEANING
DIFINITION
CHARECTERISTICS
PRINCIPLES
STRUCTURE
FUNCTIONS



1.1 INTRODUCTION TO CO-OPERATIVE SOCIETIES
Introduction
Co-operative societies are one of the forms of business organization. They are
formed all over the world. Generally, they are formed by the working and lower middle
class people who constitute the weaker sections of the society for the purpose of
safeguarding their interest against exploitation by powerful businessmen. Like, the
capitalistic form of organization which has the motto "all for himself", co-operative
societies follow the motto "each for all, and all for each", the principal theory of true co-
operative society is the elimination of profit the idea begin to provide goods and service
to members at cost.
Thus, poor farmers may form co-operative credit societies to get cheap credit
facilities and protect themselves against the exploitation of the moneylenders. Similarly,
small producers may form co-operative marketing societies to sell their products at
favorable prices and protect themselves against the exploitation to the traders.
Consumers belonging to the middle and low income group may form consumer's
co-operative societies so as to get essential commodities at fair price and protect
themselves against the exploitation by the retailers.
Co-operation is important thing, which plays an important role in all for goods and
services and in settlement of debts; money is given and received without Reference to the
standing of the person who offers to in payment.
The idea behind a co-operative society is that an isolated and powerless man, in
association with others, can lift himself as well as others out of weakness into strength, "
Co-operative (i.e., work together) for working out (i.e., Solving) your economic
problems is the theory of co-operation



1.2 Meaning of Co-operative Society
The word "co-operative' is derived from the Latin word co-operative. Co the
word means together and Operative means to work. In other words, co-operation means
to work together to achieve common purpose.
Co-operative societies are a type of business organizations on which individuals
generally belonging to the homogeneous group voluntarily associate together on the basis
of equality for the furtherance of their common economic interest.
In other words a co-operative society is a form of business origination, in which
economically weak persons voluntarily associate together as human begins, on the basis
of equality of opportunity and control, equity of distribution of profits and mutuality (i.e.,
self-help and mutual help) for the promotion of their common economic interests.

1.3 Definition of Co-operative Society
A "Co-operative society" means, a co-operative society registered under the co-
operative societies Act, 1912 or 1959 under any law for the time begins in force in any
state for the registration of co-operative societies.
Co-operation has been defined in different ways by different authorities.
Some of the important definitions are as follows:
H. Calvert, defines co-operations as " a form of organization where is persons
voluntarily associate together as human begins on the basis of equality for the
promotion of the economic interest of themselves".
Dr. C.R.Fay, defines a co-operative society as "an association for the purpose of
joint trading originating among the weak and conducted always in an unselfish
spirit on such terms that all who are prepared to assume the duties of membership
may share in its rewards in proportion to the degree in which they make use of
their associations"


Mr. Talmaki defines a co-operative society as "an association of the weak who
gather together for a common economic need and try to if themselves and others
out of weakness into strength through Business organizations, conducted for the
common benefit of all who joint it".

According to Dr. K.N.Katju Co-operation is self help as well as mutual help. It
is joint association or Enterprise of those who are not financially strong and are
enable stand on their own legs, and therefore, come together not with a view to
get profits but overcome disability arising out of want of adequate financial
resources and thus better their economic conditions".

Professor. Lamert observes " Co-operation as an enterprise formed and directed
an association of users, applying within itself the rules of Democracy and directly
intended to server both its own members and community as whole".

1.4 Characteristics or Principles of Co-operative Society
The Main characteristics or principles of a co-operative society are as follows:-
1) Body Corporate
The Registration of a society under the co-operative societies Act renders it a
body corporate. It becomes entitles to enjoy certain privileges as are enjoyed by a
company on its incorporation. Among others, mention may be made of the following
privileges:
1. The society becomes a body corporate
2. The society enjoys perpetual succession
3. The society has its own common seal
4. The society can hold property in its name


5. The society can enter into contracts with other persons
6. The society can institute and defined suits on other legal proceedings
7. The society can do all others necessary to carry on its activities with reference to
the object for which the society has been formed.
2) Voluntary Association
A Co-operative society is essentially a voluntary association of individuals. A
person is free to join a co-operative society as its member. Similarly, he is free to leave
the society any time by giving due notice to the society. Thus, there is no compulsion
either to become a member or to continue as a member.
3) Association Persons
A co-operative society is an association of persons, and not of capital. Individuals
join a co-operative society as human begins, and not as capitalists.
4) Unrestricted Membership
There is no limitation on the membership of a co-operative society. The number
of members of a co-operative society can be increased to an unlimited extent.
5) Equal Voting Rights
In a Co-operative society, each member has only one vote whatever may be the
number of shares held by him. "One member, one vote, and not One share one vote" is
the basic principle of a co-operative society. This principle enables the members to have
equal voice in the management of the society.
6) Democratic Management
Democratic management is the fundamental principle of a co-operative society.
As a co-operative operates on a local scale, generally, all the members attend the
meetings. Further at the meetings each member has only one vote. Again at the
meetings only those policies, which promote common interests, are laid down. Thus, the


day-today affairs of a co-operative society are conducted on the democratic principle of
"each for all, and all for each"
7) Service Motive
A Co-operative Society is formed primarily for the purpose of rendering
maximum services to its members, and not for earning maximum profits. Service, not
profit" is the main aim of a co-operative society.
8) Equity of Distribution of Profits
The principle of equity is adopted in the distribution of the profits of a co-
operative society. The entire profits of co-operative society are not distributed as
dividend among the members. A low rate of dividend, generally 6 % is allowed on the
capital contribution by the members. A portion of the profits is transferred to general
reserve. A small portion of the profits is used for the general welfare of the locality in
which the society is working. The rest of the profits of the society are distributed among
the members in proportion to their business with the society.
9) Liability
The liability of the members of a co-operative society may be limited. The
liability of the members is limited in the case of a limited co-operative society.
1.5 Formation of a Co-operative Society
In India, the formation and registration of co-operative societies if governed by
the provisions of the INDIAN CO-OPERATIVE SOCIETIES ACT OF 1912 or 1959
The State Co-operative society Act in force in various states.
Formation of a co-operative society, there should be at least ten members who are
bounded together by a common bond (i.e., belonging to the same locality, class or
occupation and having a common economic need). These members (called promoters)
should submit an application for registration to the Registrar of co-operative societies of
the state in which the society's office is to be located.


The application for registration should state:
The proposed name of the society
The aims and objects of the proposed society
Its area of operations
Particular of share capital proposed to be raised by issue of shares and
The nature of member's liability.
Further the application for registration should be accompanied by two copies of
the proposed bye-laws of the society. The bye-laws contain the rules for the internal;
working of the proposed society. The bye-laws are generally prepared in accordance with
the model bye-laws available with the Registrar concerned.
On receipt of the application for registration and the bye-laws, the registrar of co-
operative societies will examine them and if he is satisfied, will register the society and
will issue the certificate of registration. On registration the society comes into existence
and becomes a body corporate with a distinct legal entity, perpetual succession and a
common seal.
After its registration, the co-operative society admits new members and proceeds
to conduct the business for which it has been formed.

1.6 Classification of the Co-operative Societies in Indian
Cooperative societies may be classified in to different categories based on the
objectives, and purpose fir which they are formed and nature of activities they are
performing. When few cooperatives are formed to achieve to specific economic
objectives, others are came up with am objectives, others are came up with an objectives
of upliftment of social and economical status of its members. Based on that the following
ate the forms of co-operative societies which have developed in India.


(A) Consumer Cooperatives
(B) Producer Cooperatives
(C) Marketing Cooperatives
(D) Housing Cooperatives
(E) Credit Cooperatives
(F) Cooperatives Farming Societies
(A) Consumer Co-operatives
Consumers Co-operatives are formed with the objective of fulfilling need and
requirement of its member consumer by supplying goods and services at cheaper rate by
eliminating the middlemen. They develop relationship directly with the manufactures,
purchase the goods at wholesale price and sell them to member at comparatively less
then market price.
The profit margin which the wholesale and retailers are supposed to enjoy are pass
on to the members by the society, hence charges less price from the members without
compromising the quality.
(B) Producers Co-operatives
These types of cooperatives are formed to assist the manufactures/industrial units
in setting up, production and marketing their products. It procures plants and
machineries, raw materials and other necessary items for facilitate the member in
production of goods and services. It also, at times, takes the responsibility of marketing
the products produced by the manufactures. Small producers ate mainly benefited out if
this process. They are concentrating more and more on production and other are duly
taken care by cooperatives.



(C) Marketing Co-operatives
It is an established fact that many a small producers are not successful in their
projects because they lack marketing skill and network. Quality production and cheap
rate do not come to their rescue in marketing. It is the marketing cooperative whose
business is the purchased all the goods purchase all the goods produced by the small
manufacturer and market them when market is favorable or at different places where
there is demand for the same. The producer benefited by selling and society by earning
commission from such sales.

(D) Housing Co-operatives
Affording to the basic need of a house o to have a land to construct a house is a
stupendous task on the part of a common man due to want of requisite fund, proper
facility, managerial ability and others. Housing co-operative society are those voluntary
association of members which engaged in acquiring land from general public, develop
the same, construct houses as per the requirement of members and transfer the ownership
in their favor.
(E) Credit Co-operatives
The very objective behind formation of a co-operative society is to make free the
people of down trodden society from the clutch of village money lender. In the name f
financial support, they have exploited the poor and needy people in many a ways, thus
poorer were not given opportunity to improve their socio-economic stand. Credit
cooperative come in their way. They have been assisting the poor farmers and needy
people of the society with the provision of soft loans, easy loans at comparatively lower
rate of interest and easy terms and conditions. In this process atheist, exploitation of
money lenders has been checked to a great extent.



1.7 Credit Co-operatives are of two types namely
Agricultural credit co-operatives, and
Non-agricultural credit co-operatives
(F) Co-operative Farming Society
This society is formed by the farmers of a particular locality. Instead of going for
individual farming, they go for mass farming to get higher rate of return from economies
of scale. Combined they contribute land, labour, and capital in the field of agriculture and
share of benefits in a desired proportion among the members.
This process in more benefited because of (i) Mass production (ii) Maximum
output,(iii) Application of advanced technologies, fertilizers, seeds and others, (iv)
pooled resources fund, land and labour etc. (v) no financial crunch.
1.8 Co-operative Movement in India
In recent years, the co-operative movement has received a great impetus. In
India, the idea of co-operative took concrete shape for the first time in 1904. With the
passing of the co-operative credit societies Act which was a measures to combat rural
indebtedness and provide for credit societies. Government extended various kinds of help
to promote the objectives of these societies.
The essential features of this Act were as follows
A society could be formed by any ten persons living in the same village or town.
The co-operative societies were classified as rural and urban.
The rural societies were bonded to have unlimited liability, in case of urban
societies the question was left to their option.
The Act provides only for the formation of credit.
The area of operation within which societies could operate was callously
restricted.


The society could advance loans to members on personal securities.
The interest of a member in the share capital of the society was strictly limited. No
member could hold shares for more than Rs 1000.
The account of every society work to be audited by the register.
Societies were accepted from payment of income tax, stamp duties and
registration fees.
The societies work given a leangle personality and were authorized to rise found
and carry on they business in a co operative society.
In 1912, statutory provision was made for non credit forms of co- operation in
such activities have production, purchase, insurance, sale housing, ext... And the creation
of union of primary co-operative societies for mutual control and audit of central and
provincial banks to help the primary societies with credit
The Co-operative are the preferred instruments of socio-economic development
their contribution to the national economy of country is very significant in the wake of
declining is achieving greater heights, in the emerging environment of capitalistic from
of society for their socio-economic development .Government is also committee to
provide policy support for the development of Co-operative sector in the country.
(i) Co-operative Movement in pre-independence Era:

The pages of Indian history cite many evidences of Co-operative activities from
earliest times; however, the first recorded activity began in 1904 when this movement
was officially set up by British Government. Before that in year 1892, Derrick
Nicholson, tried to find out ways and means to establish institutions so as to help the
agricultural sector. He gave the suggestions for setting of Co-operative societies. Within
that decade, India faced a terrible famine in 1899.
The Government appointed the second Famine Commission 1901 to suggest
measurer for the victims. The commission recommended for a number of devilment


activities and setting up of new institution. The most important among them was the
strong recommendation for organization of Co-operative societies. The Government had
accepted many of the recommendation and in 1904 Co-operative Societies Act was
passed. The aim was to help the rural farmers and artisans by providing short term and
long term loans.
These credit societies were organized on the basis of two models, one for rural area and
other for the latter it was Schulze Delitzsch Bank Model. Due to this Act a number of co-
operative Societies grew up in rural area, but they could not function effectively. The
major defects were.
There was no provision for setting up of Non credit Co-operative Societies in rural
area.
No special Central agency was created for financing and supervising the activities of
these societies.
The division of the credit Co-operative societies in to two types rural and urban stood
as a barrier since no specific arrangements could be done for either due to the
overlapping nature of such classification.
The year 1928 saw a worldwide economic depression. The prices of agricultural
commodities fell down to a great extent and unemployment along with other economic
crisis grew up. The creditors had no way to repay the loan. This brought many Co-
operative movements. It had a separate department for a Co-operative credit. It helped to
keep the movement alive which was gradually decaying.
In 1937, the popular congress Government came to power in several states. The
popular leaders took much more initiative in organizing ad extending this movement. But
much progress could not do due to outbreak of Second World War. During this time, the
Ministry resigned. Ti was left in the hand of British Government again. But the war itself
gave a boost to co-operative societies. The war brought a sudden increase in the prices of
agricultural products and other food grains.


The rural farmer got extra economic gains. Non credit societies grew up. The
working capital of co-operative societies also increased. The number of different credit
and non credit co-operative increased rapidly. The Co-operative planning Committee in
1945 also worked al lot in this direction.

Main Principles of Co-operative Societies are
To inculcate the spirit of co-operators among the people in the State
To encourage people to promote co-operatives on a voluntary basis
To ensure that the co-operatives are formed and function on democratic principles
To ensure that the co-operatives in accountable to members
To ensure that the co-operatives function as useful instruments to bring about
sustained Improvement in the Quality of life of their of their members
To encourage co-operative to emerge as self supporting, economic service oriented
business concern
To encourage efficient deposit mobilization
To achieve financial gains and to put mutual aim ahead of private interest
To provide equal opportunities to all the members

(ii) Co-operative Movement in Post independence Era:
After independence for the first 3 years i.e. up to no significant development could
be made. It was mainly due to the problem created by partition and absence of concrete
programmed for national re-organization. However, the leaders of free India could the
importance of co-operative structure of country and various provisions were made
through different Five year plan.
The co-operatives movement completed its 50 years dump the first plan. The
golden jubilee was celebrated throughout the country with much excitement. This made


the people feel the importance of such a movement. Attention was given to utilize the
credit in productive activities.
The First plan also recommended for training of personnels and setting up of co-
operative Marketing Societies.
The second plan laid down proposals for extending co operative activity into
various fields. It gave special emphasis on the warehousing co operatives at the state and
central level.
The third plan brought still new areas under Co operative societies. The co
operative society for sugarcane, cotton, spinning, milk supply was proposed. Some
concrete steps were taken to train the personnels The co operative training College at
Pune and many regional centers were established to train the workers.
The Fourth Plan emphasized for consolidation of co- operative system. The new
programme for high yielding crops was started. Different societies were organized to
serve these programmes.
The fifth plan made special provisions for improvement of Central Banks and no
viable primary agricultural societies, reorganizing marketing as well as consumer
societies. It also recommended for establishment of Farmers Service Societies.
The Sixth Plan laid down a point programme for co-operative societies. It aimed
at transforming the primary village societies to multipurpose societies.
i. To reconstruct the policies and of co-operative so that it can bring about economic
development of people.
ii. To extend co-operative activities to the field of food processing, poultry farming, dairy
farming, fishery and many other related fields.
iii. To give necessary training and guidance for developing skilled the efficient personnels.
The Seventh Plan has also given more importance on the growth and expansion of
co-operative societies to ensure public participation to achieve its main objective i.e. the


movement towards social justice has to be faster and there must be a sharper focus on
employment and poverty alleviation.
1.9 Structure of Co-operative Institutions in India

Levels of Co-operative Credit Society
Primary co-operative credit societies at base level (At village level)
A State co-operative Bank works at the apex level (i.e. works at state level)
The Central Co-operative Bank works at the Intermediate Level.

Primary Co-operative Credit Society
The primary Co-operative credit society is an association of borrowers and non
borrowers residing in a particular locality. The funds of the society are derived from the
share capital and deposits of members and loans from central Co-operative banks. The
Agricultural Credit
Institutions

Non- Agricultural Credit
Institutions
Short-term Credit
Institution
State Co-operative
Banks
Long-term Credit Institution
(Land development Banks)
Central Co-operative
Banks
Primary Agricultural Credit
Societies
Co-operative Credit institutions


borrowing powers of the members as well as of the society are fixed. The loans are given
to members for the purchase of cattle, fodder, fertilizers, pesticides, etc.

State Co-operative Banks
The state co operative bank also known as Apex banks forms the apex of the
operative credit structure in each state they obtain their funds mainly form the general
public by deposits loans and advance form the reserve bank and their own share capital
and reserves.
Anywhere between 50-90% of the working capital of the SCBs are contributed
by the Reserve Bank like the CCBs, SCBs, are also pure or mixed.

Functions
The following are the major functions of SCBs.
1. The SCB acts as a banker to Central Co-operative Banks
2. They have no power to supervise or control the activities of the affiliated CCBs
3. A SCB serves as a leader of the Co-operative movements in a state
4. It gives number of subsidiaries to DCBs for improving Co-operative credit
societies.
Defects
SCB also have the same defects of the CCBS. The following are the major defects of
SCBs.
1. They are mixing commercial banking activities with Co-operative banking
2. They have insufficient share capital


3. They utilize they reserve funds as working capital.
Progress
During the year 1980-81, there were 27 state Co-operative banks, with an aggregate
membership of the 12,706 CCB and primary societies and 12,731 individuals. Their
aggregate working capital amounted to Rs.27, 496 Croes.
In june 1991, there were 28 SCBs, the deposits amounted to Rs.6,128 Crores. Their
total loans outstanding were of the order of Rs.9,660 Crores. However, their loans
overdue account for 18% in 1993-94, their deposits amounted to Rs.11,305 Croes, loans
outstanding R.9, 8011 cores.
Central Co-operative Banks
The central Co-operative Banks are federations of primary credit societies in a
specific area, normally a district and are usually located in the district headquarters or
more prominent town of the district. These banks have a few private individuals as share
holders who provide both finance and management. The central Co-operative banks have
three sources of funds via., their own share capital and reserve, deposits from the public
and loans from the state Co-operative banks.
The Central Co-operative Banks (CCB) are of two types
1) Pure
2) Mixed.
Pure: A pure CCB confines its membership to Co-operative organization only; it is
called the Banking Union.
Mixed: A mixed CCB keeps its membership open Co-operative as well as individuals.
Mixed CCBs are found in the states of Assam, Andhra Pradesh, Tamil Nadu, Karnataka
and others.



Functions
The majors functions of the CCB are:
1) The Finance the primary credit societies, by furnishing credit to the primary credit
societies, CCBs serve as an important link between these societies at the base level
and the money market of the country
2) They accept deposits from the public
3) They grant credit to their customers on the societies of first class gift edged
securities, gold, etc.
4) They provide remittance facilities
5) They act as balancing centers by shifting the excess funds of surplus primary
society to the deficit ones.
6) Progress of CCBs
In 1981-82 (July-June) there were 338 central Co-operative banks with an
aggregate working capital of over Rs.5,327 cores or which their deposit amounted to Rs.
2,768 cores. In 1993-94 (April-march), their number amounted to Rs. 362. Their
aggregate working capital has been rise to Rs.27,586 cores. Of which deposits amounted
to Rs.16,281 cores. In 1993-94 loans outstanding were of the order Rs.17,758 cores, of
which Rs.22% was loans overdue.
Defects of CCBs
The following are the major defects of the CCBs
1) They violate the principle of Co-operation by Working on the lines of Commercial
Banks.They do not appoint experts to examine the creditworthiness of the primary
societies. Hence there have been problems of recovery and over dues.
2) Many CCBs are financially and organizationally weak.
3) Mixed CCBs vitiate the very purpose of federation of the primary societies.


CHAPTER-3
COMPANY PROFILE

HISTORY
VISION
MISION
VALUES OF THE SOCIETY
SWOTS ANALYSIS
STRENTH
WEAKNESS
THREATA
OPPORTUNITIES
MANAGEMENT
ELECTION PROCEDURE
STRUCTURE
DUTIES
DEPOSIT SCHEMES
TYPES OF LOANS



SHIMOGA DURGIGUDI CO-OPERATIVE SOCIETY, SHIMOGA A-PROFILE
A-PROFILE
The Shimoga Durgigudi co-operative society registered under the co-operative
societies Act of 1959, established on 08-01-1949 has completed its useful service of 78
years in Shimoga city.
History of the society;
Before 1924 in Shimoga city, there were only one or two co-operative societies,
which were also not running well. More ever these two co-operative institutions never
use to encourage the financial aid to the formers. In such a situation a few leaders of
community firmly decided to establish a co-operative society by keeping aside their own
personal work and established the Durgigudi co-operative society.
The leaders of the society went to many houses and made persons to join the
society and collected Rs. 25% for each share of the society and on 30-04-1979, the
society was registered under the name called Durgigudi co-operative society Shimoga.
Durgigudi co - operative Society is the first bank in the district established to provide
financial assistance to the farmers alone. 38 villagers are constituted to Durgigudi co
operative society.
VISION
To make financial services universally available, to promote poverty alleviation
through the development of a strong sustainable economic infrastructure using financial
sound market mechanism.
MISSION
Linking the promotion of sustainable livelihoods with income-generation activities
for the community.
Ensure that all members follow the democratic way of making policies and electing
representatives and have an equal voice.


Ensure that all profits are controlled democratically by members and for their
benefit.
Enhance accessibility of financial services.

CO-OPERATIVE VALUES OF THE SOCIETY
1. Self help: - we believe in helping people to help themselves to grow and achieve
economic and social independence.
2. Self responsibility: - we take responsibility for, and encourage our members to
be responsible for their actions, as well.
3. Equality: - we conduct our businesses in a fair and unbiased way.
4. Democracy: - our businesses in the way we run our business.
5. Solidarity: - we share interests and common purpose with members and other co-
operatives.
SWOT ANALYSIS
Identification of the threats and opportunities in the environment and the strengths
and weakness of the firm is the cornerstone of business policy formulation. It is these
factors which determine the course of action to ensure the survival of the firm.
STRENGTHS
Providing effective training to their administrative department members and staff.
Lending of short term loans with low interest rate for agriculture and other loans.
Availability of funds.
Well experienced planning team.
Variety of new products and schemes in the product line.
The societys strengths lie in management capabilities focused strategy and speedy
decision making.
Low cost of capital.


The banks provide good infrastructural facility to its staff and help them to
concentrate more on their job.

WEAKNESSES
Limited area of operation
Execution of strict government regulations, policies and guidelines
Delay in follow up on various accounts.
As the society provides job security the employees have become less productive.
Most of the workers in the society are jagged person which might reduce the
company productivity in future.
Absence of E-banking facility.
OPPORTUNITIES
1. Increase in technology based products like E banking and mobile banking etc on
account of positioning in core banking network.
2. Increase in volume of business to improve productivity.
3. Innovative approach to rural banking with thrust on retail lending.
4. Improving economic conditions thrust to infrastructural activities which will have
an impact on other industries.
5. Increasing the scope for banking industry.
THREATS
Change in the government policy
Inflation
Recession
Competitors with different strategies in co-operative banking business.
High preliminary cost in new technology introduce in banking solutions.
Geographical disadvantages.


The management of a co-operative society is entrusted to a committee known as
board of directors. The members of the BOD are elected directly by the members of the
co-operative society at annual general body meeting.
Generally, a co-operative society has the following office bearers
President
Vice precedent
Treasurer
Chief Executive Officer
The managing committee determines the detailed programs and procedures of the
society. It is accountable to the every members of this society. The secretary is
responsible for the conduct of the day today affairs of the society in accordance with
the decisions of the BOD. He is accountable to the managing committee.
MANAGEMENT OF DURDIGUDI CO-OPERATIVE SOCIETY:
Democracy is the keynote of the management of Durgigudi co-operative society.
It is based on the principle of one member, one vote. The management of this society is
entrusted to two bodies,
1. A general committee: it consists of all the members of the society.
A managing committee: it consists of 11 directors chosen among the members of
the general committee at its general meeting.
The administration of the society is vested in the hands of the committee, which
has been elected in the general body meeting and general body is ultimate authority for
all matters of the society.
Executive committee of Durgigudi co-operative society consists of a president,
vice president, and the 9 directors. The general committee elects the members of the
managing committee, appoints an honorary secretary and adopts the subject to orders and
reports of the registrar and auditor.


Thus the management Of D.CO.O.S. is carried on by the board directors elected
by the shareholders on the basis of one member one vote.
ELECTION PROCEDURE OF D.C.S
Election is an indication of democracy. Democracy is a symptom of give and take
policy. In this co-operative scenario, indicates co-operation through valuable services for
the society growth and development. This body work can be seen in D.CO.O.S. electoral
process. The election procedure of D.CO.O.S. is according to Karnataka state co-
operative societies Act (sec-14) and comprises the following clauses:
1. Elections are held according to Karnataka state co-operative societies (Amended)
(Sec-14) (sec-134).
2. According to byelaw no. 31 of the society, total board of directors of restricted no.
11 and one is reserved for female member.
3. Default members are not eligible to contest and cast their votes according to
section 20 of the Act.
4. Elected / nominated application must be signed by the ten eligible member
[sec 14(8)]
5. Nomination applications are rejected when they are issued after the last or without
the consent of the candidate [sec 14(9)].
6. Every elected or nominated application must have deposit of Ru. 10 and get the
voucher or demand draft from the society [for male members the deposit amount
is Ru. 50] Sec 14 (10)].
7. Deposit amount are for forfeited in case the candidate failure to get 1 / 10
th
of the
total valid votes [sec. 14 (11) and (12)].
8. The candidate must be present, both nominated and constant at the time of
withdrawal of nomination [sec 14 (17].
9. Symbols of election are printed on the notice board. In the application form, the
candidate can write for three symbols, ultimately, the chief election officer has full
power to assign symbols.
10. Contestant must present at the time of scrutinizing the application.


11. According to 13-A voting candidate must have the identity card, which has been
issued by the secretary or his sub ordinates to cast the votes and sign the voting
register.
12. The person for candidature should not posses disqualifications according to 29c of
co-operative socialites Act.
In addition to the electoral clauses, a separate timetable is given for detail
information about election time, venue etc., after the election, among the directors,
one is elected as president and vice president. Usually, the president can president
over the meetings.



THE STRUCTURE OF MANAGEMENT OF D.CO.O.S. CAN BE SHOWN IN A
CHART AS FOLLOWS

PRESIDENT VICE PRESIDENT TRESURE
BOARD OF DIRECTORS
C E O
ACCOUNTANT
CASHIER
PEONE
SHARE HOLDERS


SHAREHOLDERS
Shareholders are the real owners of the co-operative society; they purchase shares
by paying its face value as their shares the total capital of the society.They exercise their
rights through casting their voters;
thereby they look after the welfare of the society with the help of directors, who
have been elected with the votes of shareholders. Usually, share holders believe in the
directors and they see overall performance of the society at the annual general body
meeting in which the final accounts are presented by the secretary. In case of shortage of
capital or surplus of capital can read jested by refunding or raising vice versa as the case
may be with the help of directors.

YEARS NO.OF
SHAREHOLDERS
31-3-2009 5275
31-3-2010 5547
31-3-2011 5797
31-3-2012 5997
31-3-2013 6210



Chart Showing Number Of Share Holders.

As the name indicates, they are not entitled voting power and exercise their rights
in the society affairs. Membership amount of the nominal members may be transferred
after
QUALIFICTION FOR MEMBERSHIP;
As per byelaw of the society, the members must be fairness and come under
Shimoga district jurisdiction and must attain 18 years old. The boards of directors have
the full power to accept or reject the membership applications.
DISQUALIFICATION FOR MEMBERSHIP:-
The membership may be cancelled for the three following reasons.
1) Not to take more time than restricted time.
2) Loan amount cannot be used for other than purpose.
3) Lunatic, insolvent, misconduct and other dis-qualifications.

5275
5545
5797
5997
6210
2009 2010 2011 2012 2013
NO OF SHAREHOLDERS
NO OF SHAREHOLDERS


LIABILITY OF MEMBERSHIP:-
The liability of members of the DURGIGUDI CO OPRRATIVE SOCIETY. in
limited to the extent of the full of the shares held by them.

PRESIDENT
President is chief executive body of the society; as he is to preside over all the
meetings and functions of the society.
Shareholders are given voting power to control and look after day to days
business of the society. But, in practical, it is not possible to all of them to come out and
see the affairs of the society. For that, as per society elected procedure they elect
directors and among the directors, one is elected as the president of the society. He can
presume his power as president for a year.
VICE PRECIDENT;-
He is basically a director. In the absence of president, he extends his co-operation
and suggestion in case of decision making process.
Vice precedent is elected by the directors. He can be the executive officer of the
society. Thus, he has the power to frame the rules regarding working and management of
the society.
DIRECTORS;
Co-operative society represents the collective responsibility of its members and its
prosperity is being carried by them, (SHAREHOLDERS)
It is not possible for all shareholders in the day to day management of the
society, as they are large in number and are scattered over Shimoga district. So, the
shareholders of the society elect among themselves some members are good in society
management as their representatives to manage the day-to day affairs of the society. The


members or representatives elected by the shareholders to manage or direct the day to
day affairs of the society. The members or representatives elected by the shareholders to
manage or direct the day-to day affairs of the society are known as DIRECTORS. As per
byelaw no. 31 of the society, total board of directors are restricted to 9 and one is
reserved for female member.
QUALIFICATION OF DIRECTORS;-
1. Director must be a shareholder of the society.
2. He must be a resident of Shimoga district.
3. Director must fill up his application in prescribed format, which has been set by
the board of directors.
4. He must fill up his application before annual general body meeting.
5. He must be a person of sound mind.

DISQUALIFICATION OF DIRECTORS;
1. Director must not be a defaulter, defaulters surety.
2. He must not be a defaulter of any other co-operative society.
3. He should not be a member of any other co-operative society.
4. He must have sound knowledge; means has not been disqualified by an order of
the court.
POWERS OF DIRECTORS
The board of directors of the society enjoys all such powers are enjoyed by the
society itself. Thus, the board us entitled to exercise all such powers and do all such acts
and things as the society is authorized to exercise and do. This means that, the powers of
board of directors are co-extensive with those of the society, i.e., as great as those of the
society.



THERE ARE HOWEVER, THE FOLLOWING IMPORTANT POWERS OF THE
DIRECTORS;
A. Directors can set a limit of loan.
B. Interest rate is to be fixed at the board meeting.
C. Power to disqualify the application of the new members.
D. Disqualification of membership of default members.
E. Power to call a special meeting of members.
F. Power to invest the funds of the society.
G. Power to verify the accounts of the society.
H. Power to appoint a secretary and internal auditor.
I. Power to get loans and meeting allowances.
THERE ARE HOWEVER, THE FOLLOWING IMPORTANT LIMITATIMNS
UPON THE POWERS OF DIRECTORS;
A. They must exercise their powers subject to the provisions contained in the co-
operative societies Act 1912.
B. The board of directors cannot exercise those powers, which are required to be
exercised by the members in the general body meeting.
C. They cannot sale or borrow outside funds without the knowledge of society
members.
MEETING OF D.CO.O.S. DIRECTORS
In case of every co-operative society, the meeting of its directors must be held at
once in every month and at least 12 such meeting must be held in every year. In case of
important decisions or policy matters interim meeting may be called. It is important to
note that there is no provisions as to the interim meetings are concerned.
According to the society, the notice of every board must be given before one
work, in writing to every director at the time being in Shimoga. And to every other
director it gives notice to any director at his usual address for communication. It may be


noted that, the failure to give notice to any director renders the meeting invalid. The
quorum for the board meeting (i.e., the minimum number of directors required for
meeting) is 1/3 of its total strength or 5 directors whichever is higher.
The proceedings of the board are to be conducted in the manner provided for in
the clause of Karnataka state co-operative societies act. The act provides that, a majority
shall decide the questions at the meeting the matters decided in the meeting are put in the
form of resolution may also be passed by circulation. The resolutions of the bound to
help others in carrying out the decisions taken by the board.
The resolution passed at the meeting are entered in the minute book of the society,
which is to be signed by the president of the succeeding meeting.
DUTIES OF DIRECTORS;
We know that, the directors of a society occupy an important position in societys
management and enjoy immense power. However, they should exercise their power for
the protection of the interest of the members. The byelaw of the society therefore
requires them to perform duties in order to prevent the abuse of power. The duties of
directors may be given as follows;
Duty to call annual every year.
Duty to maintain secret of the society.
Duty to approve balance sheet and profit and loss account before they are submitted
to auditors for their report.
Duty to attend board meetings.
Duty to send to the registrar of co-operative copies of special resolutions.
Duty to keep the register of members.
Duty to see that proper accounts are kept, profit and loss account and balance sheet
are prepared and are placed at every annual general meeting along with the auditors
report and directors report.
Duty to perform the functions of the society personally and not delegate them to
other persons.


Duty to disclose the interest of the society.
SECRETARY;
Secretary is an important officer of the society. However, he is only a subordinate
officer and has managerial functions. He is being appointed by the board and has no
original authority. He is required to perform the duties assigned to him under the co-
operative societies act and by the board of directors. He is responsible for the day-to day
working of the society, especially his duties include.
1. To keep and maintain various of the society (such as register of members, register
of directors etc.)
2. To carryout the orders of board of directors.
3. To file with the register of co-operative society, necessary document and returns
(annual returns, account etc.)
4. To submit and verify miscellaneous statements, forms and returns.
5. He is required to advise and guide the directors on all important legal matters
affecting the working of the society.
6. He should draft directors report to be presented at the annual general meeting.
7. He should arrange for the payment of dividends to the shareholders.
8. To perform all statutory requirements on behalf of directors.
9. To attend all meeting of board directors and record the proceedings of all such
meetings.
10. To organize and control the staff of the society and to supervise their work.
11. To look after all the internal or office management of society.

We know that, a secretary is appointed to perform all administrative functions, in
which an accountant, internal auditor, cashier-clerks, servants support him in carrying
out societys days activities.



WORKING OF D.CO.O.S
Introduction
Objectives Of The Society
Functions Performed By The D.Co.O.S.
Society Performance To A Glance
INTRODUCTION;
Day to day work is carried on with the help of well known staff members.
They are much essential to carry out its financial transactions. These people are treated as
work force to the financial activities.
The society works with total staff members:-
C E O
Accountant
Cashier
Peon
OBJECTIVES OF THE SOCIETY;
The main objectives of the society are;
F. To extends credit facilities or financial assistance to the members at reasonable
rate of interest.
G. To provide loans to increase agricultural production, animal husbandry, poultry
and agricultural equipments.
H. To provide loans to improve irrigation facilities to dry lands.
I. To provide co-operative education and publicity of society.
J. To border or extend facilities of co-operative society to its members.
K. To encourage the habit of saving among the members.
L. To educate small and middle class people to understand co-operative principles.



SOURCE OF FUNDS;
The following are the important source of income of DURGIGUDI.CO
OPERATIVE SOCIETY SHIMOGA.
A) Share capital;
Share capital is a capital, which has collected from its members for the
primary membership.
B) Deposits;
It is revenue deposited by the members who have saving habits in
accordance with their earnings.

FUNCTIONS PERFORMED BY THE D.CO.O.S.

1. RECEIVING OF DEPOSITS;
The society records different types of deposits from the customers.
The society has introduced several schemes to attract deposits, they are;
Saving deposits

2. GRANTING OF LOANS AND ADVANCES;
The society grants and advances to its members at the reasonable
rate of interest. The society provides following types of loans :-
Gold ornament loan
Pledge loan
Surety loan
Property loan.



3. INVESTMENT OF FUNDS;
The society invests a good portion of its funds in D.CO.O.S. (Shimoga). The total
investment of the society as on 31/3/2013 amounted to more than Rs 1622450
BENEFITS SCHEMS TO MEMBERS;
A. Members welfare fund;
In the year 1989 this scheme was introduced. Under this scheme, the membership
fees of RS 500/- on the death of the members it provides Rs 1,000/- as compensation.

B. Endowment education fund;
This scheme is introduced in the year 1999. Under this scheme it distributes Rs,
54,710/- to the students of its members. Recently it is also encouraging handicapped with
the help of this fund.

C. Safety locker facility;
Safety locker facilities provided at the society with a cheaper rate to protect its
customers from the uncertainties like, robbery, theft, fire ect. With this locker facility an
additional deposit is provided to attract customers moderate



Profit And Loss A/C As On 31-3-2013
_____________________________________________________________________________________
A) Interest Paid Income 1992052.51
Dcc Bank Loan Other Income 810.00
Interest 25,703,00
Members Deposit
Interest 3,95,078,00
Total 4,20,781,61
Less Reserves 100000.00
B)Administrative
Expenses 538893.16
C)Staff Expenses 374333.00
D)Reserves
1. Interest On
Deposits 100000.00
2. Audit Fees 22500.00
3. Depreciation On
Building 194853.00
4.Muncipal Tax 50000.00
5. Staff Gratuity 125000.00
6. Balance Fund 50000.00
7. Interest On Fixed
Deposit 23199.00
8.Depreciation On
Furniture 473.00 566025.00
Profit 192829.74
Total 1992862.51 Total 1992862.51


DEPOSIT SCHEMES AND CREDIT FACILITIES IN D.CO.O.S.DEPOSIT
SCHEMES
INTRODUCTION
TYPES OF DEPOSITS
DEPOSIT SCHEME
Deposit constitute the main source of D.CO.O.S. the society receives deposits
from the customers on various accounts .
They are as follows;-
1. Savings A/C;
This account is generally opened by all members of the society. In this account,
the depositor can deposit money at any time. Minimum amount to open S.B.A/C is Rs
2500/- and at present interest offered by the society on such deposits is 7%.
The business class, petty shop owners etc., generally opens this account this
account, in this a/c the depositer can with draw money at time. There is no interest
offered by the society on this account. Minimum amount to open a a/c Rs 250/-.
The society accepts current a/c deposits from its members. The maximum period
of this deposit is 3 years. The rate of interest offered by the society varies from 8% to 9%
up to one year. The rate of interest is 9% per annum and above one years the rate of
interest is 8% p.a.
It is also known as cumulative deposit. The maximum period of this deposit is 3
years. The rate of interest offered by the society varies from 8% to 9% p.a. deposit for up
to one year, the rate of interest is 9% p.a. and deposit for above one year, the rate of
interest is 8% p.a. quarterly accrued interest on such deposit will be added to the
principle amount



This deposit is also called as cumulative deposit. The maximum period of this
deposit is 3 years. The rate of interest offered by the society varies from 8 % p.a. deposit
for up to one year, the rate of interest is 9% p.a. deposit for above one year. The rate of
Interest is 8 % p.a.

CREDIT FACILITATES IN D.CO.O.S.
INTRODUCTION TYPES OF CREDIT PROVIDED BY THE SOCIETY.
The DURGIGUDI CO OPERATIVE SOCIETY provides loans and advances to
its members. The society provides credit facilities both to regular members and nominal
members. The society deploys its funds by the great of loans and advances to its
members depend upon their needs.
The loan is given according to the purpose for which the loans is required and the
resources where from the borrower is expected to repay have also an important bearimg
not only on society liquidity, by its desirability too. If the loan is required for non
productivity and sqeculative purpose, the society should think twice before entertaining
the proposition
TYPES OF CREDIT PROVIDDED BY THE SOCIETY;
The various types of credit facilities provided by this society are given below;-
o Pledge loan
o Gold ornament loan
o Surety loan
o Property loan.

1. Pledge loan.


This loan is provided by the society to its members on their own responsibilities
without interest for a short period. It provides self loan to its members without interest
up to 5000 with 15 % rate of interest. This loan is repayable in 100 installments.
Pledge loan is a loan provided by the society to its members on the security of
other members,. It provides loan amounting into Rs, 20,000/- for a member family which
doesnt have permanent property,. It provides loan amount at Rs. 30,000/- and for the
members family which have permanent in both the cases will be minimum 16% and
maximum 18%. The member can repay this loan in installments.
This loan is given to small farmers for the improvement their loans. The minimum
amount of loan given is Rs. 5000/- and maximum limit Rs 1,00,000/-. The repayment
period is limited to 12 monthly installments. The interest charged is 15 %.
2. Gold loans;
Gold loan is a loan gold loan is a loan provided on the security of gold ornaments.
The society provides the loan against the gold ornaments for a maximum amount of Rs
1,00,000. The loan is given on the basis of 60% of appraiser value of the gold. The rate
of interest charged is 15%.
The society provides loan to its members as the security of deposits made by
them. Thus loan is given on the basis of amount deposited by the members. The loan is
given to the he extent of 90% of the deposit amount the rate of interest charged as loan is
one rupee more than the interest given for that fixed deposit.
Loan is a loan given on the security of building owned by its members. The
minimum loan amount is Rs 40,000 /- and maximum up to Rs 150000 the rate interest
charged is 15 %. It also given subsidy at 3 % a rate of interest. On prompt payment of
loan.
3. Surety loan.
Surety loan is a loan provided to its members on the security of members house
property. The society provides maximum amount of house loan up to 5 lakhs. This is also


provided to purchase a new house. The rate of interest charged by the society is 15 %.
The society gives subsidy at 3 % in rate of interest for prompt repayment of
loan.Provides for all members of the society having own agriculture land.
4. Property loan.
Property loan is a loan provided to its members on the security of members
house property. The society provides maximum amount of house loan up to 5 lakhs. This
is also provided to purchase a new house. The rate of interest charged by the society is 15
%. The society gives subsidy at 3 % in rate of interest for prompt repayment of loan.
The society provides a loan to its members on the security of national saving
certificate. the loan is given on 70 % of face value of the national saving certificate. The
rate of interest charges by the society is 15 %.
For the purpose of comducting the survey. Questionnaire are prepared and
distributed to the selected customers to collect their opinions about various aspects of the
society. For the purpose of survey. The total 100 respondents have been interviewed
those who have regular contact with the society.
The customers are selected on the basis of gender, occupation income and so on.
The data collected during the survey is analysed by using statistical tools like
average percentage, graphs etc.





CHAPTER 4
ANALYSIS AND INTERPRETATION



ANALYSIS OF THE SURVEY
AGE GROUP
Table 5.1
Table showing distribution of respondents on the basis of their age group:
Age No. Of Respondents Percentage
18-25 9 18%
26-35 13 26%
36-60 21 42%
60&Above 7 14%
Total 50 100%

In the above table, response obtained from the respondents of the age group
between 18-25 and also 60 and above is not so effective. The opinion of the age group
between 26-35 is considerable and the opinions of the age group between 36-60 years
have good suggestion. Since, respondent of the same age group 36-60 residing at the
same area where, the society is situated and they have got regular contact with the society
is situated and they have got regular contact with the society.
As we know that, age group of 60s age is known as senior citizens of the country.
If society , provides them better services then it could have more number of customers in
that age group. In case, age group of 18-25 customers hence their percentage could be
improved. If they found job or remunerative work at the earliest time.



Chart-5.1
Chart showing classified of respondents on the basis of their age groups:

9
13
21
7
0
5
10
15
20
25
18-25 26-35 36-60 60&Above
No.Of Respondents
No.Of Respondents


OCCUPATION
Table 5. 2
Table showing distribution or respondents on the basis of their occupation:
Occupation Number of respondents Percentage
Business 24 48%
Employees 15 30%
Others 11 22%
total 50 100%

Out of 50 respondents, the last category respondents include a varied
occupation including house wives, and have given response. Where as,
businessmen and employees have given remarkable suggestions.
Society provides, number of benefits to the businessmen and job holders.
Hence, their ratio is high comparing to other respondents and it is recommend
that, if society extend its services to other customers then definitely, there could
be number of housewives and other customer can get the benefit of the society.



CHART 5. 2
Chart showing classified of respondents on the basis of their
occupation:

0
5
10
15
20
25
Business Employees Others
24
15
11
Number of respondents
Number of respondents


MEMBERS
Table-5.3
Members No. Of Respondents Percentage
Yes 38 76%
No 12 24%
Total 50 100%

From the above table it is clear that the more number of respondents are member
of DURGIGUDI CO- OPERATIVE SOCIETY out of 100% , 76% of members are
there.
And we hope in future days out of 100% there will be 90% of
respondents are members of DURGIGUDI CO-OPERATIVE SOCIETY.



Chart-5.3
Chart showing classification of members of DURGIGUDI CO-OPERATIVE
SOCIETY.

38
12
No. Of Respondents
Yes
No


ACCOUNT
Table-5.4
The below table is showing of members that they have any kind of account in
DURGIGUDI CO-OPERATIVE SOCIETY.

Members No. Of Respondents Percentage
Yes 31 62%
No 19 38%
Total 50 100%

The above given table is showing that how many members are having their
account in the DURGIGUDI CO-OPERATIVE SOCIETY, the percentage of having is
62% out of 100%, and the percentage of not having is 38% out of 100%.
So that the DURGIGUDI CO-OPERATIVE SOCIETY has to improve or it has to
increase its account by the members.



Chart-5.4
The below given table is showing that the members having their account in the
durgigudi co-operative society.

0
5
10
15
20
25
30
35
Yes No
No. Of Respondents
No. Of Respondents


ANNUAL INCOME
Table 5.5
Table showing classification of respondents on the basis of their income (per
month):
Annual Income No. Of Respondents Percentage
Below 20,000 27 54%
20,000-50,000 18 36%
50,000 and above 5 10%
Total 50 100%

Among 50 respondents interviewed, income up to rs.50,000 and above shows
negligible. The opinion of income group people 20,000 50,000 is considerable and the
income of below 20,000 is so effective.

With the above finding we can say that, the high income group people to whom
loans from other (BANKS) are available, are not getting much benefit from the society.
And it is low income group people who are more benefited out of it.



CHART 5.5
Chart showing classification of respondents on the basis of their income (per
month)

27
18
5
No. Of Respondents
Below 20,000
20,000-50,000
50,000 and above


DEPOSIT SCHEMES
Table 5.6
Table showing different types of deposit schemes of respondents.
Deposit schemes No. of respondents Percentage
Savings A/C 29 58%
Current A/C 21 42%
Total 50 100%

From the above table, it is clear that, the DURGIGUDI CO OPERATIVE
SOCIETY accepts saving deposit is more than other type of deposits. After,
current deposit occupies the major part or place.
It is advisable for the society, to make proper advertisement to attract
customer to those schemes, which are preferring at poor level.



CHART 5.6
Chart showing classification of respondents on the basis of their deposit
schemes:

0
5
10
15
20
25
30
Savings A/C
Current A/C
29
21
No. of respondents
No. of respondents


RATE OF INTEREST ON DEPOSITS
Table 5.7
Table showing general opinion of respondent towards the rate of interest on
deposits:
Opinions No. of respondents Percentage
Attractive 14 28%
Satisfactory 25 50%
Not- satisfactory 5 22%
Total 50 100%

50% of the respondents have given their opinion that; the interest offered by the
society on deposits is satisfactory. 22% of the respondents have given not satisfactory
suggestion. 28% of the respondents have opinioned that rate of interest on deposits is
attractive.
The customer who have deposited their money in the society for the long period,
they have got maximum benefit by means of interest, contrary to this, the customer who
have deposited their amount for the short period, they are not satisfied about interest rate
of the society.



CHART 5.7
Chart showing general opinion of the respondents toward the rate of interest
on deposit

0
5
10
15
20
25
Attractive
Satisfactory
Not- satisfactory
No. of respondents
No. of respondents


WORKING AND MANAGEMENT
Table-5.8
The below table showing the general opinion of the respondents towards
working and management of the society:
Opinion No. of respondents Percentage
Good 8 16%
Excellent 10 26%
Satisfactory 30 50%
Not satisfactory 2 8%
total 50 100%

From the above table, it shows that 25 persons have responded that, the working
and management and management of the society is satisfactory. 13 persons have
responded that, the working management of the society is excellent. 8 persons have
responded that the working and management of the society is good. Therefore, only 4
respondents have responded that, the working and management of the society is not
satisfactory
It is advisable for the society, to maintain and give more and more to its
customers. Therefore, management should take necessary to identify the needs and wants
of its customers.



CHART 5.8
Chart is showing general opinion of the respondents towards the working and
management of society.

0
5
10
15
20
25
30
Good Excellent Satisfactory Not
satisfactory
No. of respondents
No. of respondents


PUNCTUALITY OF STAFF MEMBERS
Table-5.9
Table showing general opinion of the respondents towards punctuality of staff
members.
Punctuality of staff
members
No. of respondents Percentage
Satisfactory 44 88%
Not satisfactory 6 12%
Total 50 100%

From the above tables it is clear that, 44 respondents have given
satisfactory opinion about the staff of the society and 6 respondents have
given not satisfactory suggestions (remarks).
Hence in future, the society should provide optimum services to its
customer s fo r creating good opinion in the minds of its customers.



CHART -5.9
Chart showing general opinion of respondents towards punctuality of staff
members:

0
5
10
15
20
25
30
35
40
45
Satisfactory Not satisfactory
44
6
No. of respondents
No. of respondents


TYPES OF LOAN
Table 5.10
The below table shows the different types of loans borrowed by the
respondents:
Types of loan No. of respondents Percentage
Pledge loan 18 36%
Gold loan 7 14%
Surety loan 15 30%
Property loan 10 20%
Total 100 100%

According to the survey , the majority of the members have taken
gold loan and surety loan i.e., 36% and 30% respectively. 14% of
respondents have taken pledge loan and 20% of respondents have taken
property loan.
Thus , the society should take measures to provide more loan facilities
and awareness of its customers towards facilities.



CHART 5.10
Chart showing different types of loan taken by the respondents.

0
2
4
6
8
10
12
14
16
18
Pledge loan Gold loan Surety loan Property loan
18
7
15
10
No. of respondents
No. of respondents


CAME TO KNOW
Table 5.11
The below table showing how did they come to know about loans and
advances of DURGIGUDI CO-OPERATIVE SOCIETY.
Way of knowing No. of respondents Percentage
Friends 12 24%
Relatives 18 36%
Society advertisements 15 30%
Others 5 10%
Total 50 100

From the above table it is clear that number of respondents came to know
about loans and advances of DURGIGUDI CO-OPERATIVE SOCIETY through so
many ways they are namely friends , relatives , society advertisements and finally
from others.
But out of these ways the way of relatives is higher than others its
percentage is 36% and percentage of friends is 24% and percentage of society is
30% and finally others percentage is 10%.



CHART 5.11
The below chart is showing of how did respondents come to know about loans and
advances of D.CO.O.S.

0
2
4
6
8
10
12
14
16
18
12
18
15
5
No. of respondents
No. of respondents


RATE OF INTEREST ON LOANS
Table-5.12
The below table showing general opinion of the respondents towards the
rate of interest on loans:
Opinions No. of respondents percentage
Low 22 44%
Moderate 16 38%
High 9 18%
Total 50 100%

The survey is conducted for 50 respondents, towards the rate of interest on loan,
22 respondents have given the opinion that the rate of interest is low, 16 respondents
opinion are moderate. 9 respondents options are high rate of interest.
It shows from the above survey that, the rate of interest charged on the loan is
affordable and customers are satisfied with this rate to get maximum loan facilities as
and when required. The negligible portions of customers are not satisfied due to
unawareness about loan facilities.



CHART 5.12
Chart showing general opinion of the respondents towards the rate of
interest on loans;

22
16
9
0
5
10
15
20
25
Low Moderate High
No. of respondents
No. of respondents


SERVICES OF THE SOCIETY
Table 5.13
The below table has shown the opinion of the respondents towards the
service of the society:
Opinion No. of respondents Percentage
Good 19 38%
Satisfactory 18 20%
Excellent 10 36%
Not-satisfactory 3 6%
Total 50 100%

From the above table , it shows that respondents have responded that service
provided by the society is excellent. 18 persons have responded that, the service given by
the society is satisfactory. And 19 respondents have responded that service given by the
society is good.
It is advisable for the society, to give more important to the customers who have
not satisfied with present society services and their opinion has to be collected at the
annual general body meeting.



CHART -5.13
Chart showing general opinion of the respondents towards services of the
society:

0
2
4
6
8
10
12
14
16
18
20
Good Satisfactory Excellent Not-satisfactory
19
18
10
3
No. of respondents
No. of respondents


CHAPTER-5
FINDINGS, SUGGESTIONS AND CONCLUSION



MAJOR FINDINGS OF THE SURVEY
Major number of respondents comes to know that about the society through
societys advertisement. It is well and good that some respondents have through friends
and from neighbors.
More number of respondents has expressed their opinion that, the rate of interest
charged on advance is considerable where as, rate of interest on deposit is low. But ,
some have opinion that rates of interest charged on advance its high. At the end borrower
have good opinion about process involved in availability of the loan.
Most of the numbers have given their opinion that response of the society. The
service provided by the society is satisfactory.
From the survey, it is observed that, the members have a good opinion in their
minds regarding the service provided by the society. Therefore, it is advisable for the
society , to maintain excellent services in the future and give more and more services to
its customers.
The management of the society had administered lot of services and deposit
schemes to its customers. When the customers face any problem that can be solved by
the management at the earliest time.
At the annual general body meeting, number of discussion was held and problems
were solved with the help of existing management setup. Hence it is said that ,
D.CO.O.S. as an excellent management and its staff.



FINDINGS, SUGGESTION AND CONCLUSION
While the survey was conducted the customers of D.CO.O.S. complained about a
number of problem, they are as follows:
1. Lack of staff
Staff is an essential element in providing facilities to the members. While getting
the response. The customers have made complaint about scarcity of staff.

2. Rate of interest on deposits:
According to survey the rate of interest offered by the society is comparatively low.

3. Enquiry counter
Facilities are known to the members through publicity and wide turnover.

4. Complaint box
Sometimes, members can highlight their grievances about the translations of the
society through complaint box.

5. Simplification of loan procedure:
Only the educated and business knowledgeable persons understand the procedure of
sanctioning the loan. It creates problems to a common man.

6. Interest on loans;
An indication of solvency of the society with minimum rate of interest, but in
D.CO.O.S. the rate of interest charged on loans is comparatively high.


7. New loans and advance schemes:
During the survey, some of the customers opinioned that, the types of loans are
few.

8. Branch expansion:
Since inception of the society , the members have been increasing due to its
handsome facilities. Hence, the membership has been overflow and it has proved more
work to the staff members with the help of opening one more branch.

9. Lack of current A/C facility:
Large number of society borrowers are related to business class and petty shop
owners. They are much interested in opening the current a/c facilities for their day to day
transaction.

10. Use of mechanical devices:
Improvement should be made in accounting software even though, the society has
made a milestone in introducing Kannada as a medium in computers.



SUGGESTION:

The management should take necessary steps to appoint more employees to fulfill
the needs of the customers. This may result in reduction of burden of the employees.
Therefore management should make arrangement for staffing in the society
sufficiently.
The society should take necessary steps to increase the rate of interest offered on
deposits.
The society has a number of illiterate and innocent members for them, enquiry
counter is essential to know about the societys facilities.
As there is no complaint box in the society, the management should take necessary
steps to provide complaint box to the members for solving their problems.
It is necessary to simplify the loan procedure because uneducated and common man
cannot understand the procedure of loan. Hence , it should be simplified with
minimum risk.
As for as possible the society should reduce the rate of interest on loan in priority
sector and it is advisable for the society to get some amount of income from other
facilities. That means the society should invest its funds in profitable ways.
The society should provide lockers facilities to the members with minimum locker
commission.
Therefore the society should take necessary steps to increase its loan facilities to
building construction. Loan on jewelers and other valuables, which are put at society
locker. This encourages the needing people to get more facilities.



Conclusion
"A co operative society is a form of business organization in which financially
weak persons voluntarily associate together as human beings on the basis of equality of
opportunity and control, equality of distribution of profits an mutuality for the promotion
of their common economic interests".
A detailed analysis of operational and financial performance of the helps in a long
way to monitor and improve the performance. An elaborate study would help to increase
the efficiency of the society. Democratic management is the fundamental principle of a
co- operative society. As a co operative society operates on a local scale, generally, all
the members must attend the meetings since in the meetings the policies, which promote
common interest, are laid down.
The study was under taken with an objective to analysis working and management
of durgigudi co-operative society and to know how the society satisfies the credit needs
of its members. The study was also made about how best the members utilize the credit
schemes of the society .Suggestions have been given for improving the working
conditions of the society. The study reveals that the society has fulfilled the objectives
for which purpose it was set up.
From one year to another year, the society has gained more continuously in a year
2007-08 to 2011-12 it may be concluded that the overall efficiency of the society has
improved. It has been observed that recovery of loan is more than expected. It has been
strengthening the financing position of the society and its member's financial soundness.
The recovery of loans is very much satisfactory.
At the same time, the borrower member should also assist in improving society's
performance by proper repayment of loans borrowed. This helps not only the society, but
also the members themselves. Therefore, it can be calculated that, the society has
fulfilled "EACH FOR ALL AND ALL FOR EACH" principle (cooperation) and the
society can flourish better by proper co- operation of director's and its valuable
shareholders.


QUESTIONNAIRE
SHIMOGA DURGIGUDI CO-OPERATIVE SOCIETY
Respected Sir /Madam,
I am Suresh S student of final year M.com in NIPGS(ATNCC) Shimoga as a part
of my academic study I have undertaken a project work on loans and advances in co-
operative society, a case study of Durgigudi Co-operative Society, Shimoga. I request
you to fill the following questions and do the needful. The information provided by you
will be used strictly for academic purpose.
Thanking you,
Yours sincerely,
(SURESH S)
1. Name: ______________________.

2. Age: 18-25 [ ]
26-35 [ ]
36-60 [ ]
60 and above [ ]

3. Sex: Male [ ]
Female [ ]

4. Occupation:
Business [ ]
Employee [ ]
Others [ ]



5. Annual income:
Up to 20,000 [ ]
20,000 50,000 [ ]
50,000 and above [ ]

6. Are you member of Durgugudi co-operative society ?
Yes [ ]
No [ ]

7. Do you have any A/C in the society ?
Yes [ ]
No [ ]

8. If yes what type of A/C are you having ?
Savings A/C [ ]
Current A/C [ ]

9. Interest payable on your deposit by society is
Attractive [ ]
Satisfactory [ ]
Not satisfactory [ ]

10. What is your opinion about workers of the society ?
Good [ ]
excellent [ ]
Satisfactory [ ]
not satisfactory [ ]



11. What is your opinion about members at the society ?
Satisfactory [ ]
Not satisfactory [ ]

12. Have you taken loan from the society ?
Yes [ ]
No [ ]

13. If yes, what type of loan ?
Pledge loan [ ]
Gold Loan [ ]
Surety Loan [ ]
Property Loan [ ]

14. How did you come to know about loans and advances of DURGIGUDI
CO OPERATIVE SOCIETY ?
Friends [ ]
Relatives [ ]
Society advertisements [ ]
Others [ ]

15. Interest charged on loans
Low [ ]
Moderate [ ]
High [ ]

16. Do you prefer any new deposit and loan schemes ?
Yes [ ]
no [ ]



17. If yes, what type of deposit and loan ?
_______________________

18. What is your opinion about the services at the society ?
Good [ ]
Satisfactory [ ]
Excellent [ ]
Not-Satisfactory [ ]

19. Any other particular suggestions ?

_________________________

Thank you,

Date: __________
Signature.
Place: __________



BIBLIOGRAPHY

1. CO-OPERATIVE MOVEMENT IN INDIA. Himalaya Publication. G.S Mathur,
Ninth Edition, Chapter 4, pages 87-98.
2. INDIAN ECONOMICS, K.K Dewett. Fourth Edition. Chapter 9, page number
225-248.
3. MONEY, BANKING AND FINANCE, United Publication. B.S Raman, Eleventh
Edition. Chapter 7 and 8.
4. MONETARY POLICY, M.C. Vaish. Third Edition. Chapter 13, pages 13. Pages
13.15-13.78
5. ENCYCLOPEDIA
OXFORD ENCYCLOPEDIA- Oxford University press 1993
BRITANNIC ENCYCLOPEDIA- Chicago, London and Toronto.
6. INTERNET SURFING
www.indian information bereau.com
www.co-operative societies.com
7. Annual Reports of the Durgigudi Co-operative Society, Shimoga.

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