S

“CONSUMER AWARENESS ON INTEREST AND

LOANS ”

Submitted in partial fulfillment of the requirement of Bachelor of Commerce

AIMS Institutes Peenya

Bengaluru – 560058

2021-2022

By

MR. KIRAN KUMAR R

(Reg no. 19SKC41017)

UNDER THE GUIDANCE OF

DR. RAVI V

(DEPARTMENT OF COMMERCE)

1
 CERTIFICATE OF THE COLLEGE

This is to certify that the dissertation titled “CONSUMER

AWARENESS ON INTEREST AND LOANS ” is based on an

original study conducted by Mr. KIRAN KUMAR R (19SKC41017)
of 6th semester BACHELOR OF COMMERCE, under the guidance
of Dr. RAVI V

This project report has not formed the basis for the award of any degree/diploma by
Bengaluru University or Institution.

Dr. RAVI V Dr. KIRAN REDDY

Program director Principal

2
 CERTIFICATE OF THE GUIDE

This is to certify that the report titled “CONSUMER AWARENESS ON

INTEREST AND LOANS ” is an original work of Mr. KIRAN
KUMAR; bearing Bengaluru University register number, 19SKC41017

and is being submitted in partial fulfillment for the award of the

Bachelor’s degree of commerce of Bangalore University. The report
has not been submitted earlier either to this university or any institution
for the fulfillment of the requirement of a course of study Mr. KIRAN
KUMAR R is guided by Dr. RAVI V, who is the faculty guide as per the

regulations of Bangalore University.

Signature of faculty guide Signature of Principal

Dr. RAVI V ACHARYA INSTITUTE OF

MANAGEMENT &SCIENCE

(Dr. MEKA KIRAN REDDY)

3
 DECLARATION

Certified that this dissertation titled “CONSUMER AWARENESS ON INTEREST

AND LOANS ” is based on an original study conducted by Mr. KIRAN KUMAR
R under my guidance. He has attended the required guidance sessions held. This
project report has not formed a basis for the award of any Degree/Diploma of any
university or institution.

4
 ACKNOWLEDGEMENT

I would like to express my special thanks & gratitude to my teacher Dr.

Ravi M as well as our Principal Dr. Kiran Reddy who gave the golden
opportunityto do this project on the topic “CONSUMER
AWARENESS ON INTEREST AND LOANS ”, which helped me to
do a lot of research on the topic and learn a lot along the way.

Secondly, I would also like to thank my parents and friends who

helped me a lot in finalizing this project within the limited time
frame.

5
 INDEX OF THE CONTENT

CHAPTER CONTENT PAGE

NO NO

01 INTRODUCTION 1

02 RESEARCH DESIGN 47

03 COMPANY PROFILE 55

04 DATA ANALYSIS AND 63

INTERPRETATION
05 FINDINGS,SUGGESTIONS, 100
CONCLUSION

6
 LIST OF TABLES

TABLE TITLE OF THE TABLES PAGE

NO NO

01 Table showing the position of Age of 60

Respondent during the year 2018-19
02 Table showing the position of gender 62
position during the year 2018-19
03 Table showing the position of Education 64
level during the year 2018-19
04 Table showing the position of how did 66
you come to know about VCCS
05 Table showing the position of Monthly 68
income during the year 2018-19
06 Table showing the position of how did you 70
come to know about VCCS during
the year 2018-19
07 Table showing the position of saving 72
account during the year 2018-19
08 Table showing the position of how many 74
years do you know VCCS
09 Table showing the position of different 76
types of account during the year 2018-19
10 Table showing the position of which 78
type of account you prefer during the year
2018-19
11 Table showing the position of aware of 80
gold scheme during the year 2018-19
12 Table showing the position of type of insurance 82
required during the year 2018-
19
13 Table showing the position of pigmy 84
rate of interest during the year 2018-19

7
14 Table showing the position of various 86
schemes and services provided by
VCCS during the year 2018-19
15 Table showing the position of as a 88
customer would you prefer during the
year 2018-19
16 Table showing the position of different 90
Interest and loans rate during the year
2018-19
17 Table showing the position of type of 92
time period during the year 2018-19
18 Table showing the position of types of 94
Loans do you requires during the year
2018-19

8
 LIST OF GRAPHS

GRAPH TITLE PAGE

NO NO
01 Graph showing the position of age 61
respondent during the year 2018-19
02 Graph showing the position of gender 63
position during the year 2018-19
03 Graph showing the position of Education 65
level during the year 2018-19
04 Graph showing the position of monthly 67
income during the year 2018-19
05 Graph showing the position of aware of 69
VCCS during the year 2018-19
06 Graph showing the position of how did 71
you come to know about VCCS during the
year 2018-19
07 Graph showing the position of own a 73
saving account during the year 2018-19
08 Graph showing the position of from how 75
many years have you know VCCS
09 Graph showing the position of Different 77
type of account during the year 2018-19
10 Graph showing the position of which type 79
of account you prefer during the year
2018-19
11 Graph showing the position of gold 81
scheme during the year 2018-19
12 Graph showing what type of insurance do 83
you required during the year 2018-19

9
13 Graph showing the position of aware of 85
pigmy rate of interest during the year
2018-19
14 Graph showing the aware of various 87
scheme and service provided by VCCS
15 Graph showing as a customer what would 89
you prefer during the year 2018-19
16 Graph showing the position of different 91
interest and loans rate during the year
2018-19
17 Graph showing the position of types of 93
time period during the year 2018-19
18 Graph showing the position of types of 95
loan do you require during the year 2018-
19

10
 CHAPTER 01

INTRODUCTION TO FINANCE

1
 Finance is a field that deals with the study of investments. It includes the
dynamics of assets and liabillites over time under conditions of different degrees of
uncertainty and risk. Finance can also be defined as the science of money
management. Finance aims to price assets based on their risk level and their
expected rate and intrest. Finance can be broken into three different sub- categories.

DEFINITION
WHEELER defines “Business finance is that finance which is concerned
with the acquisition and conservation of capital funds in meeting the needs and
overall objectives of a business enterprise”

IMPORTANCE OF FINANCE

 To purchase fixed assets such as land, building, machineries, furniture’s, etc.

 To pay for purchase of raw materials, wages etc.
 To replace existing assets or acquire new assets.
 To expand the existing business.
 To hold stock of materials and finished goods.

2
MEANING OF FINANCIAL MANAGEMENT

Financial Management means planning, organizing, directing and controlling the

financial activities such as procurement and utilization of funds of the enterprise.
It means applying general management principles to financial resources of the
enterprise.

OBJECTIVES OF FINANCIAL MANAGEMENT

The financial management is generally concerned with procurement, allocation

and control of financial resources of a concern. The objectives can be-

 To ensure regular and adequate supply of funds to the concern.

 To ensure adequate returns to the shareholders this will depend upon the
earning capacity, market price of the share, expectations of the
shareholders.
 To ensure optimum funds utilization. Once the funds are procured,
they should be utilized in maximum possible way at least cost.
 To ensure safety on investment, i.e., funds should be invested in safe
ventures so that adequate rate of return can be achieved.
 To plan a sound capital structure-There should be sound and fair
composition of capital so that a balance is maintained between debt
and equity capital.

Functions of Financial Management

1. Estimation of capital requirements: A finance manager has to

make estimation with regards to capital requirements of the
company. This will depend upon expected costs and profits and

3
 future programs and policies of a concern. Estimations have to be
made in an adequate manner which increases earning capacity of
enterprise.
2. Determination of capital composition: Once the estimation
have been made, the capital structure have to be decided. This
involves short- term and long- term debt equity analysis. This will
depend upon the proportion of equity capital a company is
possessing and additional funds which have to be raised from
outside parties.
3. Choice of sources of funds: For additional funds to be procured, a
company has many choices like-
a. Issue of shares and debentures
b. Loans to be taken from banks and financial institutions
c. Public deposits to be drawn like in form of bonds.

Choice of factor will depend on relative merits and demerits of each

source and period of financing.

4. Investment of funds: The finance manager has to decide to allocate

funds into profitable ventures so that there is safety on investment
and regular returns is possible
5. Disposal of surplus: The net profits decision have to be made by
the finance manager. This can be done in two ways:
a. Dividend declaration - It includes identifying the rate of
dividends and other benefits like bonus.
b. Retained profits - The volume has to be decided which
will depend upon expansion, innovational, diversification
plans of the company.
6. Management of cash: Finance manager has to make decisions with
regards to cash management. Cash is required for many purposes
4
like payment of wages and salaries, payment of electricity and
water

5
 bills, payment to creditors, meeting current liabilities,
maintenance of enough stock, purchase of raw materials, etc.
7. Financial controls: The finance manager has not only to plan,
procure and utilize the funds but he also has to exercise control over
finances. This can be done through many techniques like ratio
analysis, financial forecasting, cost and profit control, etc.

MEANING OF FINANCIAL STATEMENTS

A financial statement (or financial report) is a formal record of the
financial activities and position of a business, person, or other entity.

Relevant financial information is presented in a structured manner and in a

form easy to understand. They typically include basic financial statements,
accompanied by a management discussion and analysis.

1. A balance sheet, also referred to as a statement of financial position,

reports on a company's assets, liabilities, and owners’ equity at a
given point in time.
2. An income statement, also known as a statement of comprehensive
income, statement of revenue & expense, P&L or profit and loss
report, reports on a company's income, expenses, andprofits over a
period of time. A profit and loss statement provides information on
the operation of the enterprise. These include sales and the various
expenses incurred during the stated period.
3. A Statement of changes in equity, also known as equity
statement or statement of retained earnings, reports on the changes
in equity of the company during the stated period.
4. A cash flow statementreports on a company's cash flow activities,
particularly its operating, investing and financing activities.

6
For large corporations, these statements may be complex and may include
an extensive set of footnotes to the financial statements andmanagement
discussion and analysis. The notes typically describe each item on the
balance sheet, income statement and cash flow statement in further detail.
Notes to financial statements are considered an integral part of the financial
statements.

OBJECTIVES OF FINANCIAL STATEMENT

1. Knowing Profitability of Business:

Financial statements are required to ascertain whether the enterprise is
earning adequate profit and to know whether the profits have increased or
decreased as compared to the previous year(s), so that corrective steps can
be taken well in advance.

2.Knowingthe Solvency of the Business:

Financial statements help to analyze the position of the business as regards
to the capacity of the entity to repay its short as well as long term
liabilities.

3. Judging the Growth of the Business:

Through comparison of data of two or more years of business entity, we
can draw a meaningful conclusion as regard to growth of the business. For
example, increase in sales with simultaneous increase in the profits of the
business, indicates a healthy sign for the growth of the business.

4. Judging Financial Strength of Business:

Financial statements help the entity in determining solvency of the
business and help to answer various aspects viz., whether it is capable

7
to purchase

8
assets from its own resources and/or whether the entity can repay its
outside liabilities as and when they become due.

5. Making Comparison and Selection of Appropriate Policy:

To make a comparative study of the profitability of the entity with other
entities engaged in the same trade, financial statements help the
management to adopt sound business policy by making intra firm
comparison.

9
Introduction

What is consumer awareness?

Consumer Awareness is an act of making sure the buyer or

consumer is aware of the information about products, goods, services, and
consumers rights. Consumer awareness is important so that buyer can take
the right decision and make the right choice. Consumers have the right to
information, right to choose, right to safety. Let us learn more about
Consumer rights, responsibilities and consumer awareness in detail.

Consumer Rights and Responsibilities

Consumer Rights is an insight into what rights consumer holds when it

comes to seller which provide the goods. What if the goods provided to the
consumer by the business is not up to the standard? Then in that case –
what should a consumer do? To be precise, what rights consumer have
is in the court of law to fight against the malpractices of the business
firms or seller.

Consumer Rights

• Right to Safety: This is the first and the most important of the
Consumer Rights. They should be protected against the product that
hampers their safety. The protection must be against any product
which could be hazardous to their health – Mental, Physical or many
of the other factors.

• Right to Information: They should be informed about the

product. The product packaging should list the details which
should be

10
 informed to the consumer and they should not hide the same or
provide false information.

• Right to Choose: They should not be forced to select the product. A

consumer should be convinced of the product he is about to choose
and should make a decision by himself. This also means consumer
should have a variety of articles to choose from. Monopolistic
practices are not legal.

• Right to Heard: If a consumer is dissatisfied with the product

purchased then they have all the right to file a complaint against it.
And the said complaint cannot go unheard, it must be addressed in an
appropriate time frame.

• Right to Seek Redressal: In case a product is unable to satisfy the

consumer then they have the right to get the product replaced,
compensate, and return the amount invested in the product. We have
a three-tier system of redressal according to the Consumer Protection
Act 1986.

• Right to Consumer Education: Consumer has the right to know all

the information and should be made well aware of the rights and
responsibilities of the government. Lack of Consumer awareness is
the most important problem our government must solve.

Responsibilities of a Consumer

The consumer has a certain responsibility to carry as an aware consumer

can bring changes in the society and would help other consumers to fight
the unfair practice or be aware of it.

11
• They should be aware of their rights under the Consumer
Protection Act and should practice the same in case of need.

• They should be well aware of the product they are buying. Should act
as a cautious consumer while purchasing the product.

• If in case a product is found of anything false or not satisfactory a

complaint should be filed.

• The consumer should ask for a Cash Memo while making a purchase.

• A customer should check for the standard marks that have been
introduced for the authenticity of the quality of the product like ISI or
Hallmark etc.
What Is the Meaning of Consumer Awareness?

Consumer Awareness is the process of making the consumer of

goods and services aware of his rights. It involves educating a consumer
about safety, information and the redressal options available to him.

As previously discussed consumer awareness is one of the most persistent

problems the government faces when it comes to consumer protection. To
resolve this problem the government has come up with various methods
over the years. In fact, it is the main aim of the Department of Consumer
Affairs.

Need and importance of consumer awareness

It has been observed very often that a consumer does not get right
goods and services. He is charged a very high price or adulterated or low
quality goods are sold to him. Therefore it is necessary to make him
aware. Following facts classify the need of making consumers aware:
12
• To achieve maximum satisfaction:
The income of every individual is limited. He wants to buy
maximum goods and services with his income. He gets full
satisfaction only by this limited adjustment. Therefore it is necessary
that he should get the goods which are measured appropriately and
he should not be cheated in any way. For this he should be made
aware.

• Protection against exploitation:

Producers and sellers exploit the consumers in many ways as
underweighting, taking more price than the market price, selling
duplicate goods etc. Big companies through their advertisement also
mislead the consumers. Consumer awareness shields them from the
exploitation by producers and sellers.

• Control over consumption of harmful goods:

There are several such goods available in market which cause
harm to some consumers. For example we can take goods like
cigarette, tobacco, liquor etc. The consumer education and
awareness motivate people not to purchase such goods which are
very harmful for them.

• Motivation for saving:

The awareness controls people from wastage of money
and extravagancy and inspire them to take right decision.
Such consumers are not attracted by sale, concession, free
gifts, attractive packing etc due to which people can use their
income in a right way and can save money.

13
 • Knowledge regarding solution of problems:
The consumers are cheated due to illiteracy, innocence and
lack of information. Therefore it becomes necessary that the
information about their rights should be provided to them so that
they cannot be cheated by producers and sellers. Through consumer
awareness they are also made known to the proceedings of laws so
that they can solve their problems.

• Construction of healthy society:

Every member of the society is a consumer. So, if the

consumer is aware and rationale, then complete society becomes
healthy and alert towards their rights.

Interest and Loans

Interest and loans is an option on interest-only Fixed Rate

Investment Loans, which lets you prepay next year’s interest and claim it
back as a deduction this year. It also means that you will have the freedom
not to have to make monthly payments during the year.

You should talk to your accountant or financial advisor to see if this

product meets your tax needs.

How does it work?

You pay 12 months interest before the Interest and loans period
starts. For a new loan, this is usually at settlement. If you don’t have a
Common Bank transaction account already, you will need to open one in
case we need to debit any fees and charges to the account. During the
Interest and loans period, you won’t be able to reduce the principal of the
loan.

14
Different Types of Bank Loans in India
Loans can be utilized for various things in today’s world. It can be used
for funding a start-up to buying appliances for your newly purchased
house. Let us talk about the different types of loans available in the market
and their specific characteristics that make these loans useful to the
customers.

 Personal Loans:
Most banks offer personal loans to their customers and the
money can be used for any expense like paying a bill or purchasing a
new television. Generally, these loans are unsecured loans. The lender
or the bank needs certain documents like proof of assets, proof on
income, etc. before approving the personal loan amount. The borrower
must have enough assets or income to repay the loan. In case of
personal loans, the application is 1 or 2 pages in length. The borrower
gets to know about the denial or approval of the loan within a
couple of days. You must remember that the rate of interest
associated with these loans can be on the higher side. The tenure of
these loans is not that long. So, if you borrow a big amount, it can be
difficult for you to repay without planning your finances properly.
Personal loans can prove to be of great help when you wish to take a
small loan and repay it as soon as possible.

 Credit Card Loans:

When you are using a credit card, you must understand that
you will have to repay for all the purchases you make at the end of
the billing cycle. Credit cards are accepted almost everywhere, even
when you are travelling abroad. As it is one of the most convenient
ways to pay for the things you buy, it has become a popular loan

15
type. In order to apply and avail a credit card, all you need to do is

16
 fill out a simple application form provided by the card issuer. You
can also choose to apply for a credit card online. These plastic cards
come with great rewards and benefits. It’s the loan where you need
to repay on time but you are also handsomely rewarded for using it.

Obviously, there are pitfalls associated with this type of loan. You
must understand that there is a high amount of interest on the
amounts you borrow on your credit card. If you do not pay your
credit card bills on time, the interests will keep piling and might be
difficult for you to manage your finances with the rising outstanding
balance. But if you use a credit card wisely and clear all your debts
on time, it can definitely prove to your best friend in your pocket.

 Home Loans:
When you wish to purchase a house, a home loan can help you
to a great extent. It provides you the financial support and helps
you buy the house for yourself and your loved ones. These loan
generally come with longer tenures (20 years to 30 years). The rate
offered by some of the top banks in India with their home loans start at
8.30%. Your credit score is checked before the loan request is approved
by the lender. If you have a good credit score, there is a fair chance that
you will be able to enjoy lower rates of interest with your home loan.
Home loans are primarily taken for buying new homes. However, these
loan can also be used for home renovations, home extensions,
purchasing land property, under-construction houses, etc. Some of
the types of home loan that are available in the market include home
loans for repair and extension, top-up loans, land purchase loan, loan
against property, etc.

17
 Car Loans:
Buying a car can definitely instill a great sense of joy and
happiness in you. A car will remain as your asset and it is going to be
one of the biggest investments that you make. A car loan helps you to
pave the path between your dream of owning a car and actually buying
your car. Since credit reports are crucial for judging your eligibility
towards any loan, it is good to have a high credit score when you apply
for a car loan. The loan application will get approved easily and you
might get a lower rate of interest associated with the loan. Car loans are
secured loans. If you fail to pay your instalments, the lender will take
back your car and recover the outstanding debt.

 Two-Wheeler Loans:
A two-wheeler is pretty essential in today’s world. May it be
going for a long ride or a busy road in a city – bikes and scooters
help you to commute conveniently. A two-wheeler loan is easy
to apply for. This amount you borrow under this loan type helps you
to purchase a twowheeler. But if you do not pay the instalments on
time and clear your debt, the insurer will take your two-wheeler
to recover the loan amount.

 Education Loans:

If you wish to get higher education in a reputed university in

a different country, education loans can help you a lot. These loans
are opted by students who wish to study further but need financial
support for pursuing the courses. An education loan covers expenses
like college/university fees, library charges, travel costs related
to their course, etc. In order to be eligible for an education loan,
you must submit all the required documents including invitation

18
letter from the university, educational qualification certificates, etc

19
 Loan against the Insurance Schemes:
If your insurance scheme is eligible for a loan, you can avail
the loan amount from your insurer. You may also use the
investment for insurance as collateral. Generally, loans cannot be
availed right from the commencement of the insurance policy. After
3 years into the scheme, you can apply for a loan.

 Loan against Fixed Deposits:

This is a type of loan where your fixed deposit is the
collateral. For example, if you have a fixed deposit of Rs.10 lakh in
the bank, you can avail a loan of up to Rs.8 lakh. However, the rate
of interest associated with this kind of a loan is usually higher than
the fixed deposit rate.

 Loan against Mutual Funds and Shares:

Certain lenders provide loan against your mutual fund
value and share value. However, you will not be able to borrow
huge amounts under this type of loans.

20
 INDUSTRY PROFILE

Introduction

A co-operative society is not a new concept. It prevails in all the countries,

this is almost a universal concept. The cooperative society is active in all
countries worldwide and is represented in all the sectors including
agriculture, food, finance, healthcare etc.

To protect the interest of weaker sections, the co-operative society is

formed. It is a voluntary association of persons, whose motive is the
welfare of the members.

Features of a Co-operative Society

• As it is a voluntary association, the membership is also voluntary.

A person is free to join a co-operative society, and can also leave
anytime as per his desire. Irrespective of their religion, gender &
caste, membership is open to all.

• It is compulsory for the co-operative society to get registration. The co-

operative society is a separate legal identity to the society.

• It does not get affected by the entry or exit of its members.

• There is limited liability of the members of co-operative society.

Liability is limited to the extent of the amount contributed by members
as capital.

• An elected managing committee has the powers to take decisions.

Members have the right to vote, by which they elect the members who
will constitute the managing committee.

21
• The co-operative society works on the principle of mutual help &
welfare. Hence, the principal of service dominates its working. If any
surplus is generated, it is distributed amongst the members as a
dividend in conformity with the bye-laws of the society.

Types of Co-operative Society

1] Producer Co-operative

To protect the interest of small producers, these societies are set up. The
co-operative society members may be farmers, landowners, owners of the
fishing operations. To increase the marketing possibilities and production
efficiency, producers decide to work together or as separate entities.

They perform several activities like processing, marketing & distributing

their own products. This helps in lower costs and strains in each area with
a mutual benefit to each producer.

2] Consumer Co-operative

These businesses are owned and governed by consumers of the particular

area for their mutual benefit. Their view is to provide daily necessary
commodities at an optimum price. Rather than earning a pecuniary profit,
their aim is towards providing service to the consumers.

3] Credit Unions

Credit unions are generally member-owned financial cooperatives.

Their principle is of people helping people. They provide credit and

22
financial

23
services to the members at competitive prices. Each and every depositor
has right to become a member. Members attend the annual meeting and are
given rights to elect a board of directors.

4] Marketing Co-operative Society

With an aim of helping small producers in selling their products, these

societies are established. The producers who wish to obtain reasonable
prices for their output are the members of this society.

For securing a favorable market for the products they eliminate the
middlemen and improve the competitive position of its members. It
collects the output of individual members. Various marketing functions
like transportation, packaging, warehousing, etc are performed by the
cooperative societies to sell the product at the best possible price.

5] Housing Co-operative Society

To help people with limited income to construct houses at reasonable

costs, these societies are established. Their aim is to solve the housing
problems of the members. A member of this society aims to procure the
residential house at lower cost.

They construct the houses and give the option to members to pay in
installments to purchase the house. They construct flats or provide
plots to members on which the members themselves can construct the
houses as per their choice.

24
History of Credit Co-Operative Society in India

The Rochdale Pioneers

Co-operatives started out as small grass roots organizations in Western
Europe, North America and Japan in the middle of the last century,
however, it is the Rochdale Pioneers that is regarded as the prototype of
the modern co-operative society and the founders of the Co-operative
Movement.
In 1844 a group of 28 artisans working in the cotton mills in the town of
Rochdale, in the north of England established the first modern co-
operative business, the Rochdale Equitable Pioneers Society (photo).
The weavers faced miserable working conditions and low wages, and
they could not afford the high prices of food and household goods.
They decided that by pooling their scarce resources and working
together they could access basic goods at a lower price. Initially, there
were only four items for sale: flour, oatmeal, sugar and butter. The
Pioneers decided it was time shoppers were treated with honesty, openness
and respect, that they should be able to share in the profits that their
custom contributed to and that they should have a democratic.

ADVANTAGES AND DISADVANTAGES OF CO-

OPERATIVE SOCIETY

Advantages
1. Voluntary organization:

The membership of a cooperative society is open to all. Any

person with common interest can become a member. The membership
fee is kept low so that everyone would be able to join and benefit from
25
 cooperative societies. At the same time, any member who wants to
leave the society is free to do so. There are no entry or exit barriers.

2. Ease of formation:
Cooperatives can be formed much easily when compared to
a company. Any 10 members who have attained majority can join
together for forming a cooperative society by observing simple
legal formalities.

3. Democracy:
A co-operative society is run on the principle of ‘one man
one vote‘. It implies that all members have equal rights in managing
the affairs of the enterprise. Members with money power cannot
dominate the management by buying majority shares.

4. Equitable distribution of surplus:

The surplus generated by the cooperative societies is distributed
in an equitable manner among members. Therefore all the members of
the cooperative society are benefited. Further the society is also
benefited because a sum not exceeding 10 per cent of the surplus can
be utilized for promoting the welfare of the locality in which the
cooperative is located.

5. Limited liability:
The liability of the members in a cooperative society is
limited to the extent of their capital contribution. They cannot be
personally held liable for the debts of the society.

26
6. Stable existence:
A cooperative society enjoys separate legal entity which is
distinct from its members. Therefore its continuance is in no way affected
by the death, insanity or insolvency of its members. It enjoys perpetual
existence.

7. Each for all and all for each:

Co-operative societies are formed on the basis of self help and
mutual help. Therefore members contribute their efforts to promote their
common welfare.

8. Greater identity of interests:

It operates in a limited geographical area and there is greater
identity of interest among members. Members would be interacting
with each other. They can cooperate and manage the activities of the
society in a more effective manner.

9. Government support:
The government with a view to promote the growth of cooperative
societies extends all support to them. It provides loans at cheap interest
rates, provides subsidies etc.

10. Elimination of middlemen:

Cooperatives societies can deal directly with the producers and with
the ultimate consumers. Therefore they are not dependent on middlemen
and can save the profits enjoyed by the middlemen.

11. Low taxes:

To promote the co-operative movement and also because of the fact

that it is a non-profit enterprise, government provides various exemptions
and tax concessions.
27
12. Rural credit:

Co-operative societies have contributed significantly in freeing

villagers from money lenders. Earlier, money lenders used to charge high
rates of interest and the earnings of the villagers were spent on payment
on interest alone. Co-operatives provide loans at cheaper interest rates and
have benefited the rural community. After the establishment of co-
operatives, the rural people were able to come out of the grip of money
lenders.

13. Role in agricultural progress:

Co-operative societies have aided the government’s efforts to
increase agricultural production. They have improved the life of the
people in rural areas. They serve as a link between the government and
agriculturists. High yielding seeds, fertilizers, etc. are distributed by the
government through the cooperatives.

14. Own sources of finance:

A cooperative society has to transfer at-least one-fourth of its
profits to general reserve. Therefore it need not depend on
outsider’s funds to meet its future financial requirements. It can utilize
the funds available in the general reserve.

15. Encourages thrift:

Co-operative societies encourage the habit of savings and thrift
among their members. They provide loans only for productive
purposes and not for wasteful expenditure.
16. Fair price and good quality:
Co-operative societies buy and sell in bulk quantities directly
from the producers or to the consumers. Products are processed
28
and

29
 graded before they are sold. Bulk purchases and sales ensure fair prices
and good quality.

17. Social benefit:

Co-operative societies have played an important role in changing
social customs and curbing unnecessary expenditure. The profits
earned by the co-operatives have been used for providing basic
amenities to the society.

Disadvantages

1. Limited funds:
Co-operative societies have limited membership and are
promoted by the weaker sections. The membership fees collected is low.
Therefore the funds available with the co-operatives are limited.
The principle of one-man one-vote and limited dividends also reduce
the enthusiasm of members. They cannot expand their activities beyond
a particular level because of the limited financial resources.

2. Over reliance on government funds:

Co-operative societies are not able to raise their own resources.
Their sources of financing are limited and they depend on government
funds. The funding and the amount of funds that would be released by
the government are uncertain. Therefore co-operatives are not able to
plan their activities in the right manner.

3. Imposed by government:
In the Western countries, co-operative societies were voluntarily
started by the weaker sections. The objective is to improve their
economic status and protect themselves from exploitation by
businessmen. But in India, the co-operative movement was initiated and
30
 established by the government. Wide participation of people is lacking.
Therefore the benefit of the co-operatives has still not reached many
poorer sections.

4. Benefit to rural rich:

Co-operatives have benefited the rural rich and not the rural poor.
The rich people elect themselves to the managing committee and
manage the affairs of the co-operatives for their own benefit. The
agricultural produce of the small farmers is just sufficient to fulfill the
needs of their family. They do not have any surplus to market. The rich
farmers with vast tracts of land, produce in surplus quantities and the
services of co-operatives such as processing, grading, correct
weighment and fair prices actually benefit them.

5. Inadequate rural credit:

Co-operative societies give loans only for productive purposes
and not for personal or family expenses. Therefore the rural poor
continue to depend on the money lenders for meeting expenses of
marriage, medical care, social commitments etc. Co-operatives have not
been successful in freeing the rural poor from the clutches of the money
lenders.

6. Lack of managerial skills:

Co-operative societies are managed by the managing committee
elected by its members. The members of the managing committee may
not have the required qualification, skill or experience. Since it has
limited financial resources, its ability to compensate its employees is
also limited. Therefore it cannot employ the best talent.

31
Lack of managerial skills results in inefficient management, poor
functioning and difficulty in achieving objectives.

7. Government regulation:
Co-operative societies are subject to excessive government
regulation which affects their autonomy and flexibility. Adhering to
various regulations takes up much of the management’s time and effort.

8. Misuse of funds:
If the members of the managing committee are corrupt they
can swindle the funds of the co-operative society. Many cooperative
societies have faced financial troubles and closed down because of
corruption and misuse of funds.

The Co-operative Movement

1. Preamble
The history of cooperatives in India is more than a hundred years
old. The canvas of events is far too vast to give it the space it deserves
in a Report of this nature. The following is only a brief attempt to
recapture the major events that led to the cooperatives as we see them
today.

2. Background
Even before formal cooperative structures came into being
through the passing of a law, the practice of the concept of cooperation
and cooperative activities were prevalent in several parts of India.
Village communities collectively creating permanent assets like village
tanks or village forests called Devarai or Vanarai was fairly
32
common.

33
Similarly, instances of pooling of resources by groups, like food grains
after harvest to lend to needy members of the group before the next
harvest, or collecting small contributions in cash at regular intervals to
lend to members of the group viz., Chit Funds, in the erstwhile Madras
Presidency, 'Kuries' in Travancore, 'Bhishies' in Kolhapur etc. were to
be found. The 'Phads' of Kolhapur where farmers impounded water by
putting up bunds and agreed to ensure equitable distribution of water,
as well as harvesting and transporting of produce of members to the
market, and the 'Lanas' which were yearly partnerships of peasants to
cultivate jointly, and distribute the harvested produce in proportion to
the labor and bullock power contributed by their partners, were similar
instances of cooperation.

The proposal for agricultural banks was first mooted in 1858 and
again in 1881 by Mr. William Wedderburn the District Judge of
Ahmednagar, in consultation with Justice M.G. Ranade, but was
not accepted. In March 1892, Mr. Frederick Nicholson was placed by
the Governor of Madras Presidency (for inquiring into the possibility)
of introducing in this Presidency, a system of agricultural or other
land banks and submitted his report in two volumes in 1895 and 1897.

In 1901 the Famine Commission recommended the

establishment of Rural Agricultural Banks through the
establishment of Mutual Credit Associations, and such steps as were
taken by the Government of North Western provinces and Oudh. The
underlying idea of a number of persons combining together was the
voluntary creation of a new and valuable security. A strong association
competent to offer guarantees and advantages of lending to groups
instead of individuals were major advantages. The Commission also
suggested the principles underlying Agricultural Banks.

34
1. Co-operative Credit Societies Act, 1904 - The First Incorporation
Taking cognizance of these developments and to provide a legal basis
for cooperative societies, the Edward Law Committee with Mr.
Nicholson as one of the members was appointed by the Government to
examine and recommend a course of action. The Cooperative Societies
Bill, based on the recommendations of this Committee, was enacted on
25th March, 1904. As its name suggests, the Cooperative Credit
Societies Act was restricted to credit cooperatives. By 1911, there were
5,300 societies in existence with a membership of over 3 lakes. The first
few cooperative societies registered in India under the 1904 Act in the
first 5-6 years are as follows: Rajahauli Village Bank, Jorhat, Jorhat
Cooperative Town Bank and Charigaon Village Bank, Jorhat, Assam
(1904), Tirur Primary Agricultural Cooperative Bank Ltd., Tamil Nadu
(1904), Agriculture Service Cooperative Society Ltd., Devgaon, Piparia,
MP (1905), Bains Cooperative Thrift & Credit Society Ltd., Punjab
(1905), Bilipada Service Cooperative Society Ltd., Orissa (1905),
Government of India, Sectt. Cooperative Thrift & Credit Society (1905),
KanginhalVyvasayaSevaSahakari Bank Ltd., Karnataka (1905),
KasabeTadvale Cooperative Multi-Purpose Society, Maharashtra
(1905), Premier Urban Credit Society of Calcutta, West Bengal (1905),
Chittoor Cooperative Town Bank, Andhra Pradesh (1907), Rohika
Union of Cooperative Credit Societies Ltd., Bihar (1909). Under this
Act, several non credit initiatives also came up such as the
Triplicane society in Madras which ran a consumer store, weaver
credit cooperatives in Dharwar and Hubli, which gave credit in the form
of yarn etc. However, these were registered as Urban Credit Societies.

35
 The 1904 Act provided for constitution of societies, eligibility for
membership, registration, liabilities on members, disposal of profits,
shares and interests of members, privileges of societies, claims against
members, audit, inspection and enquiry, dissolution, exemption from
taxation and rule making power. All other operational and managerial
issues were left to the local governments namely to formulate suitable
rules and model bye-laws of the cooperative societies. The institution of
the Registrar, visualized as a special official mechanism to be manned by
officers with special training and appropriate attitudinal traits to
prompt and catalyze cooperative development was the result of the
Cooperative Societies Act of 1904.

3. Co-operative Societies Act, 1912

With the developments in terms of growth in the number of co-
operatives, far exceeding anticipation, the Co-operative Societies Act of
1912 became a necessity and co-operatives could be organized under this
Act for providing non-credit services to their members. The Act also
provided for Federations of cooperatives.

With this enactment, in the credit sector, urban co-operative banks

converted themselves into Central Co-operative Banks with primary co-
operatives and individuals as their members. Similarly, non-credit
activities were also co-operatively organized such as purchase and
sales unions, marketing societies, and in the non agricultural sector,
co- operatives of hand loom weavers and other artisans.

4. Maclagen Committee on Co-operation (1914)

The Banking Crisis and the First World War both affected the
growth of co-operatives. Although member deposits in co-operatives

36
increased sharply, the war affected the export and prices of cash
crops

37
adversely, resulting in increased over-dues of loans of primary agricultural
societies. To take stock of the situation, in October, 1914 a Committee on
Co-operation under Sir Edward Maclagen was appointed by the
Government, in October 1914, to study the state of, and make
recommendations for the future, of cooperatives. The Committee's
recommendations, which are detailed in Annexure-3, are basically related
to credit cooperatives. It recommended building up a strong three-tier
structure in every province with primaries at the base, the Central
Cooperative Banks at the middle tier and the Provincial Cooperative Bank
at the apex, basically to provide short-term and medium-term finance.
Considerable emphasis was laid on ensuring the cooperative character of
these institutions and training and member education, including training
of the Registrar and his staff.

5. After the 1912 Act

The first Cooperative Housing Society, the Madras Cooperative
Union in 1914, the Bombay Central Cooperative Institute in 1918 and
similar institutions in Bengal, Bihar, Orissa, Punjab etc. came up. Other
than consumer cooperatives and weavers cooperatives, other
nonagricultural credit cooperatives generally performed well and grew in
strength and operations during this period.

6. Government of India Act, 1919

In 1919, with the passing of the Reforms Act, Cooperation as a
subject was transferred to the provinces. The Bombay Cooperative
Societies Act of 1925, the first provincial Act to be passed, among others,
introduced the principle of one-man one-vote.

38
7. The agricultural credit scenario
The agricultural credit scenario was a matter of concern and various
committees looked into the problems of cooperative banks in various
provinces. The Royal Commission on Agriculture in 1928 also reviewed
the cooperative sector and among others recommended the setting up of
land mortgage banks.

8. In both agricultural
In both agricultural and non agricultural non-credit sectors, societies
were organized, but most faced difficulties in operation as a result of
opposition by private marketing agencies and also the inexperience of their
office bearers. This focused attention on strengthening of cooperative
institutes and unions for education and training. A prominent development
of this time was the setting up of the All India Association of Cooperative
Institutes in 1929.

9. The setting up

The setting up of the Reserve Bank of India (RBI) in 1934 was

a major development in the thrust for agricultural credit. The Reserve
Bank of India Act, 1934 itself required the RBI to set up an Agricultural
Credit Department. As cooperatives were to be channels for rural
development, with the establishment of popularly elected governments
in 1935, programmers were drawn up in which rural indebtedness
received priority. The Mehta Committee appointed in 1937 specifically
recommended reorganization of Cooperative Credit Societies as multi-
purpose cooperatives.
39
10. The Second World War
The Second World War boosted the prices of agricultural
commodities leading to increased returns to farmers and consequently
reduction in over-dues to the cooperatives. To counter shortages of
essential commodities for domestic consumption as well as raw materials,
the Government resorted to procurement of commodities from producers
and rationing, for which it decided to utilize the cooperatives. This
provided a momentum to the growth of multi-purpose cooperatives.

11. The period between

The period between 1939-1945 provided a further stimulus to the
growth of the Urban Cooperative Credit structure. Many societies had
started banking functions and had grown in size and operations over a
period of time, with substantial diversification of activities.

12. Multi-Unit Cooperative Societies Act, 1942

With the emergence of cooperatives having a membership from
more than one state such as the Central Government sponsored salary
earners credit societies, a need was felt for an enabling cooperative law for
such multi-unit or multi-state cooperatives. Accordingly, the Multi-Unit
Cooperative Societies Act was passed in 1942, which delegated the power
of the Central Registrar of Cooperatives to the State Registrars for all
practical purposes.

40
13. In 1944, the Gadgil Committee
In 1944, the Gadgil Committee recommended compulsory
adjustment of debts and setting up of Agricultural Credit Corporations,
wherever cooperative agencies were not strong enough.

14. Co-operative Planning Committee (1945)

The Cooperative Planning Committee under the chairmanship
of Shri R.G. Saraiya was set up in 1945. The Committee found
cooperative societies to be the most suitable medium for democratization
of economic planning and examined each area of economic development.

15. Pre-Independence Development

In 1946, inspired by SardarVallabh Bhai Patel and led by Shri
Morarji Desai and Shri Tribhuvan Das Patel, the milk producers of Khera
District of Gujarat went on a fifteen day strike. Their refusal to supply
milk forced the Bombay Government to withdraw its order granting
monopoly procurement rights to Polson, a private dairy. History was made
when two Primary Village Milk Producer Societies were registered in
October 1946. Soon after on 14th December 1946, the Khera District
Cooperative Milk Producers Milk Union known as Amul was registered.

The Registrars' Conference in 1947 recommended that the Provincial

Cooperative Banks be reorganized to give greater assistance to primary
societies through Central Banks. For the first time an effective linking of
credit with marketing, and providing assistance by way of liberal loans
and subsidies for establishment of a large number of godowns and
processing plants was considered.

41
It would be appropriate to mention here some developments in Bombay
cooperatives, which had an impact on the cooperative sector. Shri
Vaikunth Bhai Mehta took over as Minister, In-charge of Cooperation in
the Bombay Government after which the cooperative movement in the
province received a boost. A Committee on Cooperative Education and
Training under the chairmanship of Sir Janardan Madan, made
recommendations for cooperative education programmes and the setting
up of an Education Fund. The Agricultural Credit Organization
Committee, with Sir ManilalNanavati as Chairman recommended State
assistance in agricultural finance and conversion of all credit cooperatives
into multi-purpose cooperatives. It also recommended a threetier
cooperative credit banking system, and various subsidies etc.

16. Developments in the Post-Independence Era

After India attained Independence in 1947, cooperative

development received a boost, with cooperatives being given a vital role
in the various plans formulated by the Planning Commission.

The First Five Year Plan (1951-56), outlined in detail the vision of the
cooperative movement in India and the rationale for emphasizing
cooperatives and panchayats as preferred organizations for economic and
political development. The Plan emphasized the adoption of the
cooperative method of organization to cover all aspects of community
development. It provided for setting up of urban cooperative banks,
industrial cooperatives of workers, consumer cooperatives, housing
cooperatives, diffusion of knowledge through cooperative training and
education and recommended that every government department follow the
policy of building up cooperatives.

42
All India Rural Credit Survey Committee (1951)
A major watershed initiative at this time was the appointment by
Government of the Gorwala Committee, popularly known as the All India
Rural Credit Survey Committee. The Committee was appointed in 1951
and submitted its report in 1954. It observed that large parts of the country
were not covered by cooperatives and in such areas where it had been
covered, a large segment of the agricultural population remained
outside its membership. Even where membership did exist, the bulk of the
credit requirement (75.2%) was met from other sources. The
Committee recommended introducing an integrated system of rural credit,
partnership of the government in the share capital of the cooperatives
and also appointment of government nominees on their boards, thus
participating in their management. The Committee emphasized the
importance of training. The creation of the State Bank of India was
also a major recommendation. Detailed recommendations of the
Committee have been presented in Annexure-3.

The Government and the elected representatives accepted the basic

approach and the major recommendations of the Gorwala Committee. The
Union Government acquired a major interest in the Imperial Bank which
was converted into the State Bank of India. A National Cooperative
Development and Warehousing Board was set up. The Reserve Bank
of India Act was amended to enable it to play an active role in building up
of cooperative credit institutions.

The All India Cooperative Congress, held at Patna in 1956, accepted the
principle of state participation and government representation on the
Board of Directors of cooperatives. It resolved that the number of such
nominees should not exceed one-third of the total number of Directors or
three, whichever is less and applicable even to cooperatives having
43
government share capital in excess of 50% of total share capital. This
recommendation was accepted by the Central Government.

In 1953, the Government of India and the Reserve Bank jointly constituted
a Central Committee for Cooperative Training to establish necessary
training facilities for cooperative personnel. The All India Cooperative
Union and the State Cooperative Unions were entrusted with training of
members and office bearers of cooperative organizations.

The Second Five-Year Plan (1956-1961), emphasized 'building up a

cooperative sector as part of a scheme of planned development' as
being one of the central aims of National Policy. It aimed at enabling
cooperatives to increasingly become the principal basis for organization
of economic activity. The Plan drew up programmes of cooperative
development based on the recommendations of the All India Rural Credit
Survey Committee (AIRCS). It was envisaged that every family in a
village should be a member of at least one cooperative society. Linking of
credit and non-credit societies to provide better services to the farmers was
also targeted. State partnership with cooperative institutions at various
levels, the essential basis of which was to be assistance and not
interference or control, was recommended and for facilitating State
partnership in cooperatives, the Plan also recommended the establishment
of a National Agricultural Credit Long-term Operations Fund. The
National Cooperative Development Fund was also established by the
Central Government, during this period, to enable states to borrow for the
purpose of subscribing share capital of non credit cooperative institutions
in the country.

The Industrial Policy Resolution of 1956 emphasized the need for State
assistance to enterprises, organized on a cooperative basis for industrial

44
and agricultural purposes, and 'to build up a large and growing
cooperative sector'.
The Committee on Cooperative Law under the chairmanship of Shri
S.T.Raja in 1956 recommended a Model Bill for consideration of State
Governments. Another important development, at this time, which
affected the cooperative sector, was the National Development Council
Resolution (1958). The Resolution on Cooperative Policy stressed that
cooperatives should be organized on the basis of the village community as
the primary unit and that there should be close coordination between the
village cooperative and the Panchayat. The Resolution also recommended
that the restrictive features of existing cooperative legislation should
be removed.
Many State Governments amended their Acts, as a result of the
recommendations of the Model Bill
Cooperative marketing and processing of agricultural produce formed an
important part of the Integrated Scheme of Cooperative Development in
the Second Plan. About 1900 primary marketing societies were set up and
State Marketing Federations were established in all the States, as well as
the National Cooperative Marketing Federation at the Centre. Marketing
cooperatives along with the agricultural cooperatives played a major role
in promoting the Green Revolution by providing credit and inputs to
farmers as well as processing their increased outputs.

The Third Five Year Plan (1961-1969) stressed that 'Cooperation

should become, progressively, the principal basis of organization in
branches of economic life, notably agriculture, minor irrigation, small
industries and processing, marketing, distribution, rural electrification,
housing and construction and provision of essential amenities for local
communities.

45
Even the medium and large industries and in transport an increasing range
of activities can be undertaken on cooperative lines'.

From the mid-sixties onwards agro processing cooperatives, particularly

in the sugar and spinning sector grew in number and contribution, driven
primarily by the government's policy of encouraging large scale industries
in the cooperative sector and term loan assistance from financial
institutions.

With the setting up of NDDB to replicate the Anand pattern of

cooperatives in milk, the Indian dairy cooperative movement received
a spurt. Later on NDDB also ventured into the field of edible oils

After the Indo-China war in 1962, both the Consumer Cooperative

Structure and the Public Distribution System (PDS) was strengthened. The
government as a matter of policy decided to give preference to consumer
or other cooperatives in the allotment of fair price shops and certain States
allotted new fair price shops only to cooperatives.

With the growth of public deposits in Urban Cooperative Credit Societies,

it was felt necessary to insure these under the Deposit Insurance Scheme
of Reserve Bank of India. Selective provisions of the RBI Act 1934
and later Banking Regulation Act 1949 were made applicable to
Cooperative Banks w.e.f. March 1, 1966 to regulate their banking
business and facilitate insurance coverage of deposits. Thus, they became
an integral part of the banking system of the country.

18. Some National Institutions which came into existence in the 1960s
The Agricultural Refinance Corporation was set up in 1962 by the
Government of India to provide long-term loans to cooperatives, through
Central Land Mortgage Banks.
46
In 1963, the National Cooperative Development Corporation (NCDC) was
established as a statutory corporation by an Act of Parliament. The
establishment of the NCDC gave a great boost to the growth of
cooperative marketing and processing societies.

While on a visit to Anand in October 1964, impressed by the socio-

economic transformation brought about by milk cooperatives, Shri Lal
Bahadur Shastri, the then Prime Minister of India, spoke of the desirability
of setting up a national level organization, the National Dairy
Development Board (NDDB), to replicate the Anand pattern of
cooperatives in milk throughout the country.

Several other significant organizational developments also took place

during this period such as the setting up of various National Cooperative
Federations and re-organization of the National Cooperative Union of
India (NCUI). In 1967, the Vaikunth Mehta National Institute of
Cooperative Management was set up in Pune. Growth of consumer
cooperatives was also an important development of this period.
Simultaneously, the growth of Land Development Banks also accelerated
and rural electric cooperatives and programmers for dairy, poultry, fishery
and labour cooperatives were set up.

19. The Fourth Five Year Plan (1969-1974)

The Fourth Five Year Plan (1969-1974) gave high priority to the re-
organization of cooperatives to make cooperative short-term and medium-
term structure viable. It also made necessary provisions to provide
cooperatives with management subsidy and share capital contribution, as
well as for the rehabilitation of Central Cooperative Banks. It also
emphasized the need to orient policies in favour of small cultivators.

47
20. The Mirdha Committee
The Mirdha Committee in 1965 laid down standards to
determine the genuineness of cooperative societies and suggest measures
to weed out non genuine societies; to review the existing cooperative
laws and practices to eliminate vested interest. The recommendations
of the Committee resulted in amendments in the cooperative legislation in
most states, which destroyed the autonomous and democratic character
of cooperatives.

21. The Fifth Five Year Plan (1974-1979)

The Fifth Five Year Plan (1974-1979) took note of the high level of
over-dues. In its recommended strategy for cooperative development, the
correction of regional imbalances and reorienting the cooperatives towards
the under-privileged was to receive special attention. Based on the
recommendations of an Expert Group appointed by the Planning
Commission in 1972, structural reform of the cooperative set-up was
envisaged. The Plan recommended the formulation of Farmers' Services
Cooperative Societies as had been envisaged by the National Commission
on Agriculture and stressed the need for professional management of
cooperatives.

22. The Sixth Five Year Plan (1979-1985)

The Sixth Five Year Plan (1979-1985) also emphasized the

importance of cooperative efforts being more systematically directed
towards ameliorating the economic conditions of the rural poor. The Plan
recommended steps for re-organizing Primary Agricultural Credit
48
Societies into strong and viable multi-purpose units. It also suggested
strengthening the linkages between consumer and marketing cooperatives.
Consolidation of the role of Cooperative Federal Organizations,
strengthening development of dairy, fishery and minor irrigation
cooperatives, manpower development in small and medium cooperatives
were some of the planned programmes.

23. NABARD Act, 1981

The National Bank for Agriculture and Rural Development

(NABARD) Act was passed in 1981 and NABARD was set up to provide
re-finance support to Cooperative Banks and to supplement the resources
of Commercial Banks and Regional Rural Banks to enhance credit flow to
the agriculture and rural sector.

24. Multi-State Co-operative Societies Act, 1984

With the objective of introducing a comprehensive central
legislation to facilitate the organization and functioning of genuine multi-
state societies and to bring uniformity in their administration and
management, the MSCS Act of 1984 was enacted. The earlier Multi-Unit
Cooperative Societies Act of 1942 was repealed.

25. The Seventh Five Year Plan (1985-1990)

The Seventh Five Year Plan (1985-1990) pointed out that while
there had been all round progress in credit, poor recovery of loans and
high level of overdues were matters of concern. The Plan
recommended amongst others development of Primary Agricultural
Credit Societies as multiple viable units; realignment of policies and
49
procedures to expand

50
flow of credit and ensure inputs and services particularly to weaker
sections; special programmes for the North Eastern Region; strengthening
of consumer cooperative movement in urban as well as rural areas and
promoting professional management.

26. With increasing demand

With increasing demand from proponents of an autonomous
cooperative movement and reforms in the Cooperative laws, the
Government constituted a Committee on Cooperative Law for
Democratization and Professionalization of Management in Cooperatives
in 1985, headed by Shri K.N.Ardhanareeswaran. The Committee
recommended the deletion of those legal provisions in State
Cooperative Acts, which militate against the democratic character and
autonomy of cooperatives, and also recommended incorporation of
several provisions which could activize democratic processes for
infusing professional management into cooperatives.

27. Similarly, in 1989

Similarly, in 1989 the Agricultural Credit Review Committee under
the chairmanship of Prof. A.M. Khusro examined the problems of
agricultural and rural credit and recommended a major systemic
improvement. The Committee recommended that the Eighth Plan should
become the plan for revival of weak agricultural credit societies.

28. Model Co-operatives Act, 1990

In 1990, an Expert Committee, under the chairmanship of
ChoudharyBrahmPerkash, was appointed by the Planning Commission to
51
make a rapid review of the broad status of the cooperative movement,
suggest future directions and finalize a Model Cooperatives Act. The
Committee submitted its report in 1991. Since cooperation is a State
subject and each State has its own cooperative legislation covering
cooperatives whose membership is confined to the State, the report of the
Committee, along with a draft Model Cooperative Law, was circulated to
all State Governments for their consideration and adoption at State level.

29. The opening up of the economy in 1990

The opening up of the economy in 1990, and the liberalized

economic policies followed by the government since then, led to
increasing pressures for various governments, state and central, to bring
about changes that would provide cooperatives a level playing field to
compete with the private sector. The Eighth Five Year Plan (1992-1997)
laid emphasis on building up the cooperative movement as a self-
managed, self-regulated and self-reliant institutional set-up, by giving
it more autonomy and democratizing the movement. It also spoke of
enhancing the capability of cooperatives for improving economic
activity and creating employment opportunities for small farmers,
labourers, artisans, scheduled castes, scheduled tribes and women and
emphasized development and training of cooperative functionaries in
professional management.

30. Parallel Co-operative Legislation

From the Ninth Plan (1997-2002) onwards, there has been no
specific mention about cooperatives as a part of the Plan. Since
Cooperation is a State subject and recognizing the difficulties in

52
having

53
the existing State Cooperative Acts amended on the lines of the Model
Cooperatives Act, a section of cooperators and civil society initiated
action to put in place Parallel Cooperative Legislation for self-reliant
cooperatives. Self- reliant cooperatives are generally defined as those
which have not received any assistance from the Government in the form
of equity contribution, loans and guarantees. These Acts are largely based
on the recommendations of the ChoudharyBrahmPerkash Committee.
Nine States namely AP (1995), MP (1999), Bihar (1996), J&K
(1999),
Orissa (2001), Karnataka (1997), Jharkhand (1996)), Chhattisgarh (1999)
and Uttaranchal (2003), have so far enacted Parallel Cooperative Acts
which are enabling and ensure autonomous and democratic functioning of
cooperatives.

31. Multi-State Co-operative Societies Act, 2002

The Multi-State Cooperative Societies (MSCS) Act, enacted in

1984, was modified in 2002, in keeping with the spirit of the Model
Cooperatives Act. Unlike the State Laws, which remained as a parallel
legislation to co-exist with the earlier laws, the MSCS Act, 2002 replaced
the earlier Act of 1984.

32. National Co-operative Policy (2002)

In 2002, the Government of India enunciated a National
Cooperative Policy. The objective of the Policy is to facilitate an all round
development of cooperatives in the country. The policy promises to
provide cooperatives with the necessary support, encouragement and
assistance, to ensure their functioning as autonomous, self-reliant and
democratically managed institutions, accountable to their members, and
54
making a significant contribution to the national economy.

55
Based on the recommendations made at a Conference of State Ministers
for Cooperation, the Government of India in 2002 constituted a
Ministerial Task Force to formulate a plan of action for implementation
of National Cooperative Policy. The Task Force suggested that a single
law instead of parallel laws should be introduced in the States. It also
recommended, among others, that in order to depoliticize
cooperatives, Members of Parliament or Members of Legislative
Assemblies should not be allowed to hold office of any cooperative
society.

33. The Companies Amendment Act, 2002

A Committee under the chairmanship of Dr.Y.K.Alagh
recommended the amendment of the Companies Act, 1956. On the basis
of the recommendations of the Committee, the Producer Companies Bill
was introduced in the Parliament and became law on 6th February, 2003
as Part IXA - Producer Companies in the Companies Act, 1956. Based on
the cooperative principles of mutual assistance, it provides an alternative
to the institutional form that is presently available to cooperative
enterprises.

34. NCDC Amendment Act, 2002

Recognizing the need to improve its scope of lending and to bring
about changes in its funding, the NCDC Act was amended in 2002, which
has enabled it to cover notified services, livestock and industrial activities
and more importantly to directly fund cooperatives against suitable
security.

56
35. Task Force on Revival of Co-operative Credit Institutions
To nurse the rural cooperative credit system back to health, to
ensure that the rural credit doubled over three years and that the coverage
of small and marginal farmers by institutional lending was expanded
substantially, the Government of India in August 2004 set up a Task Force
to suggest an action plan for reviving rural cooperative credit
institutions and legal measures necessary for facilitating this process. The
Task Force, chaired by Prof. A. Vaidyanathan, recommended that any
financial restructuring which did not address the root causes of the
weaknesses of the system would not result in its sustained revival and
would require legal measures. The recommendations of the Task Force in
accordance with its Terms of Reference are basically confined to revival
of credit cooperatives for which it suggests a financial package. The
Vaidyanathan Committee has also suggested a model cooperative law that
can be enacted by the State Governments. Recommendations of the
Task Force are being currently implemented. The Vaidyanathan
Committee has also given its report on the long-term cooperative credit
structure.

57
 CHAPTER 02

RESEARCH DESIGH

58
INTRODUCTION

Research in common parlances refers to a search for knowledge. In fact

research is an act of scientific investigation.

The chapter deals with the methodology selected by the investigation in

order to study the research problems. Research methodology is a way to
systematically solve the research problem. It may be understood as a
science of studying how research is done scientifically. Methodology of
the research indicates the general pattern of organizing the procedure for
gathering valid and reliable data for problems under investigation. It is a
way to systematically solve the research problems. Research methodology
is considered as one of the important aspect because it emphasis the whole
process of the study.

Statement of the Problem

This project report focuses on the Consumer awareness on interest and

Loans in VISVESVARAYA CREDIT CO-OPERATIVE SOCIETY
Bangalore and to use this information effectively to improve the
effectiveness of society.

Title of the study

The title of the project report is “Consumer awareness on Interest and

Loans” at VISVESVARAYA CREDIT CO-OPERATIVE SOCIETY ,
Bangalore.

59
Scope of the study

The study covers different levels of Consumer awareness at various

levels, the study is restricted to the VISVESVARAYA CREDIT CO-
OPERATIVE SOCIETY Bangalore

Objective of the study

Objective form is the background of any work of study. Every study

has its own objectives that determine the right path in achieving the
targeted goals.

The main objectives of the study:

 To know the awareness among the customers of VCCS

 To get the suggestions to improve the effectiveness of the society.

 To know it’s inter and intra relationship in societies.

Research Design

A research design is the arrangement of conditions for collection

and analysis of data in a manner that aims to combine relevance to the
research purpose with economy in procedure.

60
Types of Research Design

 Exploratory Research

Experimental research is preliminary study of an unfamiliar problem

about which the researcher has title. It is usually takes the form of
pilot study.

 Experimental Research

Experimental research is designed to assess the effects of particular

variables or a phenomena by keeping the other variable constant or
controlled.

 Descriptive Method Research

Descriptive research is fact finding investigation with

adequate interpretation it is more specific than on explorative study,
as it’s focused on particular aspects or dimensions of the problem
studies.
This method is applicable to the problem, which satisfy
certain criteria, the problem must be describable and not an
agreeable. The data should be amenable to an accurate objective. It
should be possible to develop valid standards of comparison. It
should lend itself to variable procedure of collection and analysis of
data.

61
Data Collection

Data collection is one of the important steps in research work. The

researcher has to take for source of data, which can be collected and
analyzed to achieve results as per the set of objectives there are two types
of data.

 Primary Data.

 Secondary Data.

Primary Data

Data collection is the data, which are prepared or collected for the first is
mainly dependent on primary data. The primary data collected for this
study is from the questionnaires.
Secondary Data

The secondary data collected from internet and previous reports.

Sampling

According to C.K Kothari “Sampling may be defined as the selection of

the basis of which a judgement or inference about the aggregate or totality
is made. It is the process of obtaining information about an entire
population by examining only a part of it. It items so selected constitute
what is called as sampling”.

The sampling should have a meaning of how large a sample the research,
wish to drew the population in the order to fulfill the objective of research

62
that is the determine in advance of how many respondents are to be
included in the sample. For the purpose of his study.

The researcher has taken 50 customers in the VISVESVARYA CREDIT

CO-OPERATIVE SOCIETY

In that majority of the male and few of the female employee.

Sampling Technique

Sampling technique has been for the study. Each item of the universe is an
equal chance of being selected the total No. of 50 respondents were taken
as a sample size in this study.

Method and Tools of Data Collection

A researcher has used the below shown methods and tools to collect data.
Questionnaire is used as a tools of data collection, a detailed questionnaire
elicited all required information derived from the objectives of the study,
a consists of a number of questions printed or typed in a defined order on
a form.

Analysis of Data

The data analays in Percentages and Data is prescribed in the

questionnaire form and with graphical presentation of data is also made.

Tabulation of Data

Data collection from the research was verified, sorted and edited into
systematic tabular form. Tables were drawn on each to prevent data in an
understanding way.
63
Percentage

The tables contain absolute figures and the percentage in respect to the
total figures. The percentage was used to generalize the study.

Graph

The tables are represented pictorially to provide easy comprehension

of data and analysis was made. Finally summary of findings and
suggestion were based on the data collected.

Operational Definition of Concept

According to Ked Man and Moray “Research is a systematized effort

to gain new knowledge”.

According to the advanced Lerner’s dictionary of the current English

“Research means a careful investigation or inquiry especially through
search for new facts in any branch of knowledge.

Limitation of the Study

The research project is aimed at analyzing the “A study on customer

awareness on interest and

Loans” in a VCCS Bangalore.

 The study is confined to only Visvesvaraya Credit Co-

Operative Society.

64
 Then accuracy of the findings may not be perfect as there may be
response bail.

 Financial limit is another constraint to the study.

 It has been assumed that information given by respondents is true

and fair.

65
66
 CHAPTER 03

COMPANY PROFILE

67
SIR M.VISVESVARYA CREDIT CO-OPERATIVE SOCIETY
OVERVIEW

ESTABLISHED 1979

It is a matter of great privilege for us to introduce the SIR

M.VISVESVARAYA Credit Co-operative Society Ltd., situated #1,9TH
MAIN ROAD RAJAJINAGAR,2ND STAGE BANGLORE 560010

During 2016 a group of enthusiastic friends gathered and

thought the necessity of a co-operative society in the area of
premises. The group which consist of co-operative thinkers gave
a definite shape for their vision and on 11/05/2016 emerged a
society called “Visvesvaraya Credit Cooperative Society Ltd”.

A small rented room in VCCS has witnessed the 1st Society’s

transaction with Rs5000000/- working capital. Later with successful
transaction with efficient workforce society started developing to its
great height.

During the course of journey various presidents with great qualifications

and personalities has administrated and gave yeomen service to the
society.

At present our society has about over 2crores share capital with
2000 members and 1800 pigmy customers and yearly turnover
approximately more than 10 crores.

68
MANAGEMENT

Board of Directors

 K N VENKATANARAYANA (President)

 SHANKARANARAYANA (Vice president)

 H.R GOPINATH (Director)

 B.S SRIPATHI RAO (Director)

 D.S HONNAPPA (Director)

 B TEJAS (Joint Treasurer)

 G YESHAS (Trustee)

 C NAGESHWAR RAO (Trustee)

 V HARISH KUMAR (Trustee)

 B S BHARTHI (Trustee)

 BALEGOWDA (Trustee)

 RAJESH KUMAR (Director)

69
OUR ACHIEVEMENTS

 “Jury special Award” From M/S global Infomart PVT ltd,

Mumbai.
 “Best urban Co-operative society” from Karnataka state
union Federation for year 2011-12.
 Awarded as one of the best Co-operative society in
Karnataka for the last 5 years. (2004,2005,2006,2007and
2008)
 Our president KN VENKATANARAYANA was awarded
“Senior co-operative” from Karnataka state co-operative
housing federation.
 Won GOLD award in international level quality circle
competition in year 2010 by ICQCC – Hyderabad
 Awarded frontiers in co-operative society in 2006-2007 in the
areas of “Branch Innovation” and “IT Strategy”
 Awarded frontiers in co-operative society in 2007-2008 in the
areas of
“Innovation in customer services”

70
 SERVICES

Standing Instructions

E-stamping is a computer based application and a secured electronic

way of paying Non-Judicial stamp duty to the Government. The
prevailing system of physical stamp paper/franking is being replaced
by E-stamping system.

NEFT

National Electronic Funds Transfer (NEFT) is a nation-wide

payment system facilitating one-to-one funds transfer. Under this
Scheme, individuals can electronically transfer funds from any
bank branch to any individual having an account in society
mediating through Karnataka State Co-operative Apex Bank Ltd.,
Account Name Visvasvaraya Credit Co-
Operative Society ltd

Bank Name Sir M. Visvesvaraya co-

with Address operative SOCIETY #1,9TH
MAIN ROAD
RAJAJINAGAR,2ND
STAGE BANGLORE
560010
Bank Account 3534784225
number
IFSC code MVCB0000003

71
Cheques

Society also provides the indirect cheques clearing facilities to its

members through central Bank.

FACILITIES

E-stamping is a computer based application and a secured

electronic way of paying Non-Judicial stamp duty to the
Government. The prevailing system of physical stamp
paper/franking is being replaced by E-stamping system.

 E-Stamp Certificate can be generated within minutes

 E-Stamp Certificate generated is tamper proof
 Authenticity of the e-Stamp certificate can be checked through the
inquiry module
 E-Stamp Certificate generated has a Unique Identification Number
 Specific denomination is not required.
 E-stamp certificate can be check by any person through
recommended site. The Society has introduced E-stamping service
at Head Office.

Loans are granted by the society to its members under

different schemes as detailed hereunder:

 SURETY LOAN

Personal/Surety loans are sanctioned to the members on surety of

salaried employees of State/ Central Government, Semi-
Government, Public Sector / Reputed private companies and co-
operative institutions for small business, self employment, house
72
 repair, education etc subject to fulfillment of requirement of the
Society.

 IMMOVABLE PROPERTY LOAN

Loans for construction of residential houses and for

repayment of debts by mortgaging the property can be availed on
producing the required documentation to the society. Maximum of
Rs.25 Lakhs is being advanced to member and Nominal members.
The period of repayment of the loan is 180 - 240 months.

 GOLD LOAN

A maximum of Rs.500000/- is being advanced to members/non

members against the pledge of Gold Jewellery. The period of
repayment of the loan is 12 - 24 months.

 EDUCATION LOAN

Loans are sanctioned for education of children of members on

fulfillment of requirements of the Society

 Few More Loans Are

• House Repair Loan

• Business Development Loan
• Medical Loan
• Marriage Loan
• Building Mortgage
• Special Loan on Immovable Property

73
DEPOSITES
 C.K.R. Cash Deposit ( 90 months - 7.5 years )
 Recurring Deposit - 1 to 5 years (Min. Monthly Installment 200)
Rate of Interest 8%
 Savings Account (Rate of Interest 3.75%)
 Pigmy Deposit - (Rate of Interest 2/4%)

74
 CHAPTER 04

DATA ANALYSIS
&Interpretation
75
Age of respondent

Table No : 01

PARTICULARS NO OF PERCENTAGE
RESPONDANTS
20-30 16 32%
30-40 16 32%
40-50 13 26%
50 ABOVE 5 10%
Total 50 100 %

Analysis : From the above table we can understand that 32% of the
respondents who answered the survey were below the age of 30, another
32% of the respondents were below the age of 40,26% of the respondents
were between 40-50 years of age and the remaining 10 % of the
respondents were above 50 years of age

76
 Graph No :01

35%

30%

25%

20%
Series1
15%
10%

5%

0%
20-30 30-40 40-50 50 Above

Interpretation

From the above graph we can see that majority of the respondents are
under the age of 40

77
Gender of respondents

Table No 2

PARTICULAR NO OF RESPONDENTS PERCENTAGE

Male 30 60%
Female 20 40%
Others 0 0%
Total 50 100%

Analysis:
From the above table we can see that 60% of the respondents are male
while the remaining 40% of the respondents are female

78
Graph No: 02

120%

100%

80%

60%

40%

20%

0%

Male Female Others Total

PERCENTAGE

Interpretation:

From the above chart we can see that the majority of the respondents are
male

79
Education Level

Table No: 03

PARTICULAR NO OF RESPONDENTS PERCENTAGE

High School 7 14.3%
Higher Secondary 14 28.6%
Bachelors 23 46.9%
Masters 5 10.2%
Total 50 100%

Analysis :
From the above table we can see that a majority of the respondents that is
46.9% of the respondents have finished their bachelors, 28.6% of the
respondents have finished their higher secondary education, 14.3% of the
respondents have finished high school and the remaining 10.2 % of the
respondents have graduated from their masters

80
Graph No: 03

120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

High School Higher Bachelors Masters Total

Secondary

PERCENTAGE

Interpretation:
From the above graph we can observe that majority of the
respondents have finished their bachelor degree and the least number of
respondents have finished their master degree

81
Monthly income

Table No: 04

PARTICULAR NO OF RESPONDENTS PERCENTAGE

Below 10000 10 20%
10000-20000 19 40%
20000-30000 14 25%
Above 30000 7 15%
TOTAL 50 100%

Analysis :
From the above table we can observe that 40% of the respondents belong
to a monthly income of 10000-20000,25% of the respondents belong to a
monthly income of 20000-30000, 20% of the respondents belong to a
monthly income of Below 10000 and the remaining 15% of the
respondents belong to a monthly income of Above 30000

82
Graph No: 04

120%

100%

80%

60%

40%

20%

0%

Below 1000010000-2000020000-30000Above 30000 TOTAL

PERCENTAGE

Interpretation:

From the above chart we can see that the total number of respondents have
Rs20000-30000 as monthly income

83
Are you aware of Visvesvaraya Credit Co -operative Society (VCCS)

Table No:05

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
YES 32 68%
NO 16 32%
TOTAL 50 100%

Analysis :
From the above table we can see that 68% of the respondents are aware
of VCCS while the remaining 32% of the respondents are not aware of it

84
Graph No: 05

120%

100%

80%

60%

40%

20%

0%

YES NO TOTAL

PERCENTAGE

Interpretation:

From the above chart we can see that the majority of the respondents are
aware of VCCS

85
How did you come to know about VCCS

Table No:06

PARTICULAR NO OF RESPONDENTS PERCENTAGE

Advertisement 15 30.6%
Employees at VCCS 16 32.7%
Present Customer 8 16.3%
Others 10 20.4%
TOTAL 50 100%

Analysis:

From the above table we can say that a majority of the respondents that is
32.7% came to know about VCCS through its employees, another 30% of
the respondents were made aware of it through advertising,16.3% of the
respondents came to know about it through the present customers of VCCS
and 20.4% of the respondents came to know about it through other sources

86
Graph No: 06

120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

Advertisement Employees at Present Others TOTAL

VCCS Customer

PERCENTAGE

Interpretation:

From the above graph we can see that a majority of the customers were
made aware of VCCS either through its employees or through
advertisements

87
Do you own a saving account in VCCS

Table No: 07

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
YES 45 91.2%
NO 5 8.8%
TOTAL 50 100%

Analysis :
From the above table we can see that majority of the respondents that is
91.2% have a savings account while only 8.8% of the respondents do not
have a savings account .

88
Graph No: 07

120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

YES NO TOTAL

PERCENTAGE

Interpretation:

From the above graph we can see that majority of the respondents have a
savings account

89
For how many years have you known VCCS

Table No:08

PARTICULAR NO OF RESPONDENTS PERCENTAGE

0-1 Years 13 26%
1-2 Years 21 42%
2-3 Years 8 16%
More than 3 Years 8 16%
TOTAL 50 100%

Analysis :
From the above table we can see that 26 % of the respondents have
known about VCCS for 0-1 years,42% of the respondents have
known VCCS for 1-2 years,16% of the respondents have known VCCS
for 2-3 years and another 16 % of the respondents have known VCCS
for more than 3 years

90
Graph No: 08

120%

100%

80%

60%

40%

20%

0%

0-1 Years 1-2 Years 2-3 Years More than 3 TOTAL

Years

PERCENTAGE

Interpretation

From the above chart we can see that a majority of the respondents have
known VCCS for about 1-2 years

91
Are you aware of the different types of accounts in VCCS

Table No:09

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
YES 42 84%
NO 8 16%
TOTAL 50 100%

Analysis :
From the above table we can see that a majority of 84% of the respondents
are aware of the different types of accounts in VCCS and the
remaining 16% of the respondents are unaware of the different types of
accounts in VCCS

92
Graph No: 09

120%

100%

80%

60%

40%

20%

0%

YES NO TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that majority of the respondents are
aware of the different types of accounts VCCS

93
Which type of account do you prefer

Table No:10

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Savings Account 32 64%
Current 11 22%
Fixed 7 14%
TOTAL 50 100%

Analysis :
From the above table we can see that majority of the respondents that is
64% prefer a savings account,22% of the respondents prefer a current
account and the remaining 14% of the respondents prefer a fixed account

94
Graph No: 10

70%

60%

50%

40%
Series1
30%

20%

10%

0%
Savings A/c Current A/c Fixed A/c

Interpretation:
From the above graph we can see that most of the respondents prefer
a savings account

95
Are you aware of gold scheme in VCCS

Table No: 11

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Yes 36 73.5%
No 13 26.5%
TOTAL 50 100%

Analysis:
From the above table we can see that 73.5% of the respondents are aware
of the gold scheme while 26.5 % of the respondents are not aware of the
gold scheme

96
Graph No:11
120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

Yes No TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that a majority of the respondents are
aware of the gold scheme offered by VCCS

97
What type of insurance do you require from VCCS

Table No:12

PARTICULAR NO OF PERCENTAGE
RESPONDANTS
Life insurance 25 51%
General insurance 12 24.5%
Not applicable 12 24.5%
TOTAL 50 100%

Analysis:
From the above table we can see that 51% of the respondents require
life insurance policies ,24.5% of the respondents require general
insurance and the remaining 24.5% do not require any insurance.

98
Graph No: 12

120%

100%

80%

60%

40%

20%

0%

Life insuranceGeneral insuranceNot applicable TOTAL

PERCENTAGE

Interpretation:

From the above graph we can see that a majority of the respondents
say they require a life insurance over a general insurance policy.

99
Are you aware of pigmy rate of interest?

Table No: 13

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Yes 26 52.1%
No 24 45.8%
TOTAL 50 100%

Analysis:
From the above table we can see that 52.1% of the respondents are aware
of the pigmy rate of interest while the remaining 45.8% of the respondents
were not aware of the pigmy rate of interest

100
Graph No: 13

120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

Yes No TOTAL

PERCENTAGE

Interpretation:
From the above chart we can see that there is a slight majority in the
number of respondents who are aware of the pigmy rate of interest

101
Are you aware of the various schemes and services provided by

VCCS Table No: 14

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Yes 31 62.5%
No 19 37.5%
TOTAL 50 100%

Analysis:

From the above table we can see that 62.5% of the respondents are aware
of the various schemes and services the remaining 37.5%% of the
respondents were not aware of the various schemes and services
provided by VCCS

102
Graph No: 14

120.00%

100.00%

80.00%

60.00%

40.00%

20.00%

0.00%

Yes No TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that majority of the respondents are
aware of the various schemes and services provided by VCCS

103
15 As a customer would you prefer:

Table No: 15

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Credit co-operative society 41 82%
Credit co-operative bank 9 18%
TOTAL 50 100%

Analysis:
From the above table we can see that 82% of the respondents are
prefer the Credit co-operative society and only 18% of the respondents
are prefer Credit co-operative bank.

104
Graph No: 15

120%

100%

80%

60%

40%

20%

0%

Credit co-operative society Credit co-operative bank TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that majority of the respondents prefer a
credit co-operative society over a credit co-operative bank

105
Do you check the different rates of interest for loans from more than
one corporate society

Table No: 16

PARTICULAR NO OF PERCENTAGE
RESPONDENTS
Yes 39 78%
No 11 22%
TOTAL 50 100%

Analysis:
From the above table we can see that 78% of the respondents check the
different rates of interest for loans from more than one corporate
society and only 22% do not check the different rates of interest for
loans from more than one corporate society

106
Graph No: 16

120%

100%

80%

60%

40%

20%

0%

Yes No TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that majority of the respondents check
the different rates of interest from different co-operative society

107
What type of time period do you prefer on your loan?

Table No. 17

Particular No of Respondents Percentage

Short term 14 28%
Medium term 24 48%
Long Term 12 24%
Total 50 100%

Analysis: From the above table we can see that 48% of the
respondents prefer Medium term,28% of the respondents prefer Short
term and the rest =
24% of the respondents prefer long tem loans

108
Graph No: 17

120%

100%

80%

60%

40%

20%

0%

Short term Medium term Long Term Total

Percentage

Interpretation:
From the above graph we can see that a majority of the respondents prefer
a mideum term loan over a short or long term loan

109
What type of loans do you require?

Table No:18

PARTICULAR NO OF RESPONDENTS PERCENTAGE

Education Loan 11 22%
Home Loan 13 26%
Personal Loan 19 38%
Vehicle Loan 7 14%
TOTAL 50 100%

Analysis:
From the above table we can see that 38% of the respondents require
Personal Loan,

26% of the respondents require home loan,22% of the respondents

require Education Loan and rest 14% of the respondents require Vehicle
loan

110
Graph No: 18

120%

100%

80%

60%

40%

20%

0%

Education LoanHome LoanPersonal LoanVehicle Loan TOTAL

PERCENTAGE

Interpretation:
From the above graph we can see that majority of the respondents prefer a
personal loan over a home loan education loan and a vehicle loan

111
CHAPTER 05

Findings
SUGGESTIONS
CONCLUSION

112
 Out of 50 respondents it can be observed that 32% of residents
belong to the age group of 20 to 30 and 30 to 40. Hence the
majority of respondents of the survey belong to the age group of 20
to 30 and 30 to 40.
 Out of 50 respondents it can be observed that 60% of the
respondents are male and 40% of the residents are female. Hence
the majority of respondents of the survey belong to male.
 Out of 50 respondents it can be observed that 46.9% of the
respondents have finished their bachelors. Hence the majority of
respondents in the survey are graduate.
 Out of 50 respondents it can be observed that 68% of the
respondents are aware of VCCS. Hence the majority of respondents
in the survey are aware of VCCS.
 Out of 50 respondents it can be observed that 32% of the
respondents are aware of VCCS by employees at VCCS. Hence the
majority of respondents in the survey are aware of VCCS by the
employees at VCCS
 Out of 50 respondents it can be observed that 90% of the
respondents own savings account at VCCS. Hence the majority of
the respondents in the survey are account holders
 Out of 50 respondents it can be observed that 84% of the
respondents are aware of different types of accounts in VCCS.
Hence the majority of the respondents in the survey are users of
accounts.

113
 Out of 50 respondents it can be observed that 72% of the
respondents are aware of gold schemes. Hence the majority of the
respondents in the survey prefer gold scheme
 Out of 50 respondents it can be observed that 52.1% of the
respondents aware of pigmy rate of interest. Hence the majority of
the respondents in the survey are aware of pigmy rate of interest
 Out of 50 respondents it can be observed that 60% of the
respondents prefer credit co-operative society. Hence the majority
of the respondents in the survey prefer credit co-operative society.
 Out of 50 respondents it can be observed that 38% of the
respondents prefer personal loans. Hence the majority of the
respondents in the survey prefer personal loans.

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 SUGGESTIONS

 A society should target female gender as well since there is gap of

10% between male and female.
 Educate your customer on financial literacy
 Embrace financial technology
 Segments your client base and create personalized customer
experiences.
 Credit Co-operative Society should be improving the schemes,
services and policies.
 Credit Co-operative Society should improve the pigmy rate of
interest.
 Credit Co-operative Society should improve advertisement of the
society
 Credit Co-operative Society should target senior

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 CONCLUSION

From the survey of the CONSUMER AWARENESS ON INTEREST

AND LOANS ON VISVESVARYA CREDIT CO-OPERATIVE
SOCIETY.

 The findings from the survey conducted and interaction with the
management and customer in line with the hypothesis.
 One of the main driving force for the customer was the interest rate.
The customer prefer the credit co-operative society which provided
more speciliased service.
 The above factors are also the driving force for the customers to
choose the credit co-operative society over the bank.
 In context to the finding from the research conducted the hypothesis
hold true.

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 BIBLOGRAPHY

BOOKS NAME AUTHOR

FINANCIAL MANAGEMENT J.M PANDEY

CONSUMER AWARENESS AND A.M SUMANTH AND G GANESH

WELFARE PROTECTION

INTREST AND LOANS R. SIVANESAN AND ANANDA

KRISHNA-MURGA
PUBLICATIONS

MANAGEMENT PROCESS VISION PUBLICATIONS

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