A STUDY ON LOANS AND ADVANCES

AT SUCO BANK

By,
PRAVEEN KUMAR P
1CR17MBA61
 DEFINITION

As per sec 5 of the Banking Regulation Act 1949, loan

advances means “A loan or advances made on the security of
assets the market value of which is not at any time less than the
amount of such loan or advances”.

OBJECTIVE OF THE STUDY

 To0understand0the contribution of0banking sector to0economy growth.

 First objective is0to find out various loan0schemes provided by0the bank.
 To0understand0the granting of0loans0and advances process.
 To0find out the major challenges faced.
 To0learn various0aspects of 0loan provided by bank.
 To0know the problem0faced by0customers when0obtaining the loan.
 To study substantial growth in0loan and advances.
 RESEARCH METHODOLOGY

PRIMARY DATA

 The primary data is collected from the SUCO0bank and personal discussion
with0the my external guide of the0bank.
 The method which was0adopted to collect information is personal interview
method.
 Primary data is basically the live data0which I collected on field
while0talking with0the employees. 000

SECONDARY DATA
Secondary data is already published data. 0It is the data which is funded0or
collected by someone else before0and presently used0by further research work.
• The secondary data was collected0through annual report0of the bank for
the0period of 5 years.
• Also from0the bank pamphlets, website, 0internet, and0other website etc.
 LIMITATIONS OF THE STUDY 00

 The0study is limited only02 month,0where can’t be sufficient0to

understanding0and evaluating the0performance of the0bank. 000

 The0study based on0secondary data0only on balance sheet0and the annual0report

of the0bank. 0000

 As0project is prepared0for academic purpose0only it suffers from the0limitation of

the bank. 00000

 This0study is only0relates to one organization, so conclusion drawn0may not

be0finding its utility0in all the other0banks. 000000

 Even0the employees0of the bank paused to0give the complete and0accurate data.
00
 DEFINITION OF CO-OPERATIVE BANKS
“A Co-operative bank, as0its name indicates is an institution consisting of a
number0of individuals who join together to pool their surplus savings for the purpose
of0eliminating the profits of the bankers or money lenders with a view to distributing
the0same amongst the depositors and borrowers”.

The Co-operative banks in rural areas mainly finance agricultural

based activities like:
 Farming

 Cattle

 Milk

 Hatchery

 Personal finance
CLASSIFICATION OF CO-OPERATIVE BANKS
FUNCTIONS OF BANKING
1. Primary Functions of Banks
2. Secondary Functions of Banks

1. Primary Functions of Banks:

 Accepting Deposits
 Granting of Loans and Advances

A. Accepting Deposits: B. Granting of Loans and Advances:

 Saving Deposits  Overdraft

 Fixed Deposits  Cash Credits

 Current Deposit  Loans

 Recurring Deposits  Discounting of Bill of Exchange

2. Secondary Functions of Banks:
 Agency Functions
 General Utility Functions
A. Agency Functions:
 Transfer of Funds
 Collection of Cheques
 Periodic Payments
 Portfolio Management
 Periodic Collections
 Other Agency Functions
B. General Utility Functions:
 Locker Facility
 Underwriting of Shares
 Dealing in Foreign Exchange
 Project Reports
 Social Welfare Programmers
 Other Utility Functions
SUCO Souharda Co-Operative Bank was established in 1993 the founder and
chairman of Sri Manohar Maski. The bank started started talulk center of Raichur
district, Sindhanur was establisdhed in 1995 as Sindhanur Urban co-operative bank
under the leadership of Mr.Manohar Maski. The bank became popular as SUCO
Bank; hence bank changed its registerd name its self to SUCO Bank. The theme
SUCO Bank draws the motivation to start the bank from the success of Janatha
Bank, Sindhanur, SUCO Bank started in computerized and air conditioned
environment from day one . The Bank is one of the best Souharda Sahakari Act
(KSSA) 1997. The Bank is the present is functioning with of branches in the year
of 2015-16 and in 2017-18 the bank opened 10 branches and has total 28 branches
today.
 VISION
Taking credit services to the door steps of farmer as well economical backward rural
like BPL, SHG etc.
• To provide integrated credit package for the farmers
• To spread co-operative education through farmers club
• To be strongest organization in rural
• To promote self Help groups collaboration with NABARD
• To strengthen Self Help group through linkage with PACS

MISSION
Improve the economic development of farmers. Through making available loan at
reasonable rates and on simple terms so as release from the clutches of the money
lenders.
 Loan are the main asset of SUCO bank provide following
types of loan

 Agriculture loan:

 Allied Agriculture loan.

 Agriculture loan:
 Non-Agriculture loan
 Non –farm sectoral loan:
 Cash credit loan:
 Marketing Society loan  Personal loan.
 Education loan.
 Business loan
 Gold loan
 Gruha Vaibhava loan (housing loan)
 Mortage loan
 Vehicle loan.
 SWOT ANALYSIS

STRENGTH WEAKNESS

 Costumer friendly services  Lack of aggressive marketing strategies

 Increasing profits over the years  Increasing NPA
 The young and energetic staff  Risk adverse
 latest technologies and the most modern
banking channels.

OPPORTUNITIES THREATS

 Government and sponsored bank  Highly competitive environment

support  Economic slowdown
 Rural areas
 Start mobile & internet banking
 Small enterprise banking improved
urban retail banking
LOAN SERVICE PROFILE OF SUCO BANK
1. Agriculture allied activities loans
2. Agriculture allied Business loans
3. Agriculture gold loans
4. Business gold loans
5. Gruha Vaibhava (Housing loan)
6. Cousumption loans (Salary loan)
7. Dhanya Laxmi key loans (Agriclturists, Traders)
8. Education loan
9. Mortage loan
10. Over draft /Cash credit loan
11. Prime gold loan
12. Small scale industries loans
13. Site purchase loan
14. Vehicle loans- pre owned vehicles 3 & 4 wheelers up to Rs.5 lacks
15. Vehicle loan up to Rs.2 lacks.
 INTEREST RATES CHAREGED ON LOAN

Types of loan Interest rate

I. Gold loans

1) Agriculture gold loan 15% P.A (1 year term)

2) Krishi gold loan 11% P.A (1 year term)

3)Prime gold loan 14.5% P.A (6 months)

4) SUCO gold 13% P.A (3 months)

2. Business loans 16.75% P.A

3. Consumption loans 17.50% P.A

4. Vehicle loans 18% P.A

5. Agriculture allied activites loan 16.50% P.A

6. Key loan 14.50% P.A

7. Over draft / cash credits interest

8. Loan on fixed deposits Int + 1.50% P.A

PROCESS OF LOAN GRANTATION
 ANALYSIS OF ANNUAL LOANS AND ADVANCES (2017-18)

Types of Loans Amount (In Rs.) Percentage (%)

Advance of 305,39,39,000 72.06

Agriculture

Cash Credit 11,23,22,000 2.65

Medium term loan 12,57,09,000 2.95

Non farm sector 94,57,89,000 22.32

Total 423,77,59,000 100

% of Loans And Advances

22.32

Advance of Agriculture
2.95 Cash Credit
Medium term loan
2.65
Non form sector

72.06
 Recovery of Loans (in lakhs)

Collection %
Demand Collection Balance 2015-16 2014-15
A)Agriculture loans
Short Term Loans 24222.92 21641.34 2581.58 89 87
Medium Term Loans 216.09 209.53 6.56 96 48
Medium Term Conversion
Loans 97 3.75 93.25 3 1
B) Non Agriculture Loans
Non Farm Sector 1077.59 931.58 146.01 86 82
Vehicle Loans 443.75 403.38 40.37 90 93
Consumption Loans 1426.2 1367.66 58.54 95 95
Gold Loans 2899.87 2795.28 104.59 96 94

% of Recovery of Loans
2015-16 2014-15
86 95 96
89 96 90 93 95 94
87 82
48
3 1

Short Term Medium Medium Non Farm Vehicle Salary Loans Gold Loans
Loans Term Loans Term Sector Loans
Conversion
Loans
BIBLIOGRAPHY

 Annual Report of SUCO Co-operative Bank

 Financial management by Khan and Jain
 Reserve Bank of India Circulars

E-SOURCES

http://www.sucobank.com
www.indianbanking.regulation.com
www.literaturereviwesource.com