Professional Documents
Culture Documents
Final Report 1646
Final Report 1646
ON
ACKNOWLEDGEMENT
1
I hereby do solemnly acknowledge that I have taken my sincerest efforts in this project.
However, it would not have been possible without the support and help of many individuals
and organizations indulged along the way. I would like to extend my sincere thanks to all of
them.
I am highly indebted to MR.PARVEEN KUMAR ABROL for his guidance and the
constant supervision as well as for providing all the necessary information to me regarding
the project and also for the support in completing the project.
I would like to express my sincere gratitude towards my parents, friends & members for their
kind co-operation and encouragement which help me in completion of this project.
I would also like to express my special gratitude and thanks to the industry persons for giving
me such kind attention and time. My thanks and appreciations also go to all of my colleague
who formed a part in developing the project and the people who have willingly helped me out
with their special abilities.
2
I have the pleasure in certifying that Anamika Sankhwar is a bonafide student of 4th
Semester of the Master’s Degree in Business Administration (Batch 2021-2023), of
Chandigarh University, Gharuan, Mohali, Punjab with UID No.21MBA1646
She has completed his/her Capstone project work “RURAL BANKING IN INDIA AND
IT’S FUTURE” under my guidance.
I certify that this is his/her original effort & has not been copied from any other source. This
project has also not been submitted in any other institute / University for the purpose of
award of any Degree.
This Project fulfils the requirement of the curriculum prescribed by this university for the said
course. I recommend this project work for evaluation & consideration for the award of
Degree to the student.
Signature :___________
Name of the Guide: PARVEEN KUMAR ABROL
Designation : ASSISTANT PROFESSOR
Date : ___________
EXECUTIVE SUMMARY
3
Since India is agriculture oriented country, the importance of rural banks in India is
more than any other countries. The development of rural banks in India is on the
process but still it is not fully developed.
The Rural banks in India was started in 1975.Rural banking in India is the result of a
deliberate policy of the state and is vigorously pursued through formation of an
elaborate governing infrastructure.
In India we find that the states of Maharashtra and Gujarat are well developed.
Whereas the states of Andhra Pradesh, Rajasthan and Karnataka have shown
remarkable progress in the Rural banks and there is a vast potential for the
development of RRBs in the remaining states.
This project is mainly focusing on the importance of Rural bank in the regional rural
areas of our country. Because of that reason The Government has introduced several
schemes for promoting the spirit of co-operation. Both the Indian Government as
well as the Government of the State of Maharashtra has introduced several schemes
for the RRBs bank. The NABARD role in the building of the rural credit structure was
that of an active collaborator in drawing up schemes of development with the
government of India and the State Governments, and the provider of finance, first to
the State Governments for contribution to the share capital of Rural credit institutions
at various levels.
TABLE OF CONTENTS
4
ACKNOWLEDGEMENT...............................................................................................................
EXECUTIVE SUMMARY……………………………………………………………………4
Chapter 1: Introduction....................................................................................................................
Chapter 6: Limitations...................................................................................................................
Annexure (QUESTIONNAIRE)....................................................................................................
PLAGIARISM Report 52
CHAPTER 1
5
INTRODUCTION
6
Our nation is supported by its villages. India is a country with a big rural
population that engages in agriculture and its related activities on a larger scale.
These activities revenue accounts for a larger portion of India’s GDP. It is well
recognised that the banking system is the engine driving the growth of any
nation's economy and will always be the deciding factor in the fiercely
competitive global economic world. They are growing, producing profitably, and
have good quality assets. Prior to the introduction of cooperative banking, which
was intended to strengthen the rural credit mechanism, this sector was similarly
unable to meet the financial needs of the rural areas. This insufficient scenario
prompted the Indian government to establish a committee to identify workable
solutions to enable simple mechanisms for rural credit satisfaction. Regional
Rural Banks were recommended to be established by the committee led by Shri.
M. Narasimhan in 1975. The regional rural bank in India is particularly
concerned with providing credit to rural residents. Regional Rural Banks of India
meets the financial needs of rural residents for their agricultural and agro -based
businesses, and as a result, they make money from their banking activity to fund
their operations. Rural banking in India refers to the provision of banking and
financial services to the rural population in the country. It plays a crucial role in
promoting financial inclusion and economic development in rural areas, which
constitute a significant proportion of India's population.
Over the years, the rural banking sector in India has undergone significant
reforms, with the government and the Reserve Bank of India (RBI) taking
several measures to improve access to financial services in rural areas. However,
despite these efforts, a significant proportion of the rural population still remains
unbanked or underbanked. There are several challenges to rural banking in India,
including a lack of financial literacy and awareness, poor infrastructure, and the
prevalence of informal financial channels. However, the introduction of
technology-enabled financial services, such as mobile banking and digital
payments, has the potential to revolutionize the rural banking sector in India.
In the future, rural banking in India is likely to witness significant growth and
innovation, driven by a combination of technology, policy initiatives, and private
sector investment. This presents both opportunities and challenges for
stakeholders, including banks, government agencies, and NGOs, to promote
financial inclusion and economic development in rural areas.
In this project, I have focused mainly on the future of Rural Banking in
India and also highlighted on several other information and issues.
7
BANKING POLICY IN RURAL INDIA: 1969 TO PRESENT
The period from 1969 to the present can be characterised as representing, broadly speaking,
three phases in banking policy vis-à-vis the Indian countryside. The first was the period
following the nationalization of India’s 14 major commercial banks in 1969. This was also
the early phase of the ‘green revolution’ in rural India, and one of the objectives of the
nationalization of banks was for the state to gain access to new liquidity, particularly among
rich farmers, in the countryside. The declared objectives of the new policy with respect to
rural banking - what came to be known as “social and development banking” - were (i) to
provide banking services in previously unbanked or under-banked rural areas; (ii) to provide
substantial credit to specific activities, including agriculture and cottage industries; and (iii)
to provide credit to certain disadvantaged groups such as, for example, Dalit and Scheduled
Tribe households.
The introduction of social and development banking policy entailed a radical shift from
prevalent practice in respect of the objective and functioning of commercial banks. An
important feature of the policy of social and development banking was that it recast
completely the role of commercial banks in rural banking. Prior to 1969, the countryside was
not considered to be the problem of commercial banks.5 It was only after 1969 that a multi-
institutional approach to credit provision in the countryside became policy, with commercial
banks, Regional Rural Banks and cooperative institutions establishing wide geographical and
functional reach in the Indian countryside.
The Reserve Bank of India (RBI) issued specific directives with respect to social and
development banking. These included setting targets for the expansion of rural branches,
imposing ceilings on interest rates, and setting guidelines for the sectoral allocation of credit.
Rural credit was an important component of the ‘green revolution’ package; the first post-
nationalization phase of expansion in rural banking saw a substantial growth in credit advances
for agriculture. Specifically, a target of 40 per cent of advances for the “priority sectors,” namely
agriculture and allied activities, and small-scale and cottage industries, was set for commercial
banks. Advances to the countryside increased substantially, although they were, as was the green
revolution itself, biased in respect of regions, crops and classes.
The second phase, which began in the late 1970s and early 1980s, was a period when the rhetoric
of land reform was finally discarded by the ruling classes themselves, and a period when the
major instruments of official anti-poverty policy were programmes for the creation of
employment. Two strategies for employment generation were envisaged, namely wage-
employment through state-sponsored rural employment schemes and self-employment generation
by means of loans-cum-subsidy schemes targeted at the rural poor. Thus began a period of
directed credit, during which credit was directed towards “the weaker sections.” The most
important new scheme of this phase was, of course, the Integrated Rural Development
Programme or IRDP, a scheme for the creation of productive income-bearing assets among the
poor through the allocation of subsidized credit. The IRDP was initiated in 1978-79 as a pilot
project and extended to all rural blocks of the country in 1980. There is much writing on the
failure of IRDP to create long-term income bearing assets in the hands of asset-poor rural
households. Among the many reasons for this failure were the absence of agrarian reform and
decentralized institutions of democratic government, the inadequacy of public infrastructure and
public provisioning of support services and the persistence of employment-insecurity and poverty
in rural society. Nevertheless, the IRDP strategy did lead to a significant transfer of funds to the
rural poor.
8
The third and current phase, which began in 1991, is that of liberalization. The policy
objectives of this phase are encapsulated in the Report of the Committee on the
Financial System, which was chaired, ironically, by the same person who
recommended the establishment of Regional Rural Banks, M. Narasimham (RBI,
1991). In its very first paragraph, the report called for “a vibrant and competitive
financial system…to sustain the ongoing reform in the structural aspects of the real
economy.” The Committee said that redistributive objectives “should use the
instrumentality of the fiscal rather than the credit system” and, accordingly, that
“directed credit programmes should be phased out.” It also recommended that interest
rates be deregulated, that capital adequacy norms be changed (to “compete with banks
globally”), that branch licensing policy be revoked, that a new institutional structure
that is “market-driven and based on profitability” be created, and that the part played
by private Indian and foreign banks be enlarged. Let us make it clear that, before the
1990s, the banking system was open to much criticism, particularly of its bureaucratic
failures, its insensitivity to the social and economic contexts in which it functioned, and
class and regional inequalities in lending patterns. The reforms proposed in 1991,
however, were not attempts to bring rural banking closer to the poor, but to cut it back
altogether and throw the entire structure of social and development banking overboard.
Rural credit has been a laboratory for various policies, initiatives, investigations and
improvements since 1955.The first major strategy adopted for improving rural credit
delivery was the institutionalization of the credit delivery system with the cooperative as
the primary channels. The multi-agency approach to the rural credit delivery emerged with
the induction of the commercial banks into the scene. In 1979, specialized institutions
called Regional Rural Banks and subsequently, another breed of institutions called Local
Area Banks, came on the scene. With the operationalisation of the Lead Bank Scheme, the
area approach to rural lending was formalized and attempts were made to match
infrastructure development with bank credit flows for ensuring development of the rural
areas. The Scheme sought to give a special supply-leading role to the banking system in
rural development and also to ensure access of the rural population to bank services
through rural branch expansion. A multi-agency credit delivery system is in place for
financing credit-based development activities, under the Lead Bank Scheme. In 1988, the
Service Area Approach was also introduced as a strategy for improving the quality of rural
9
lending. The Lead Bank Scheme Information System and Service Area Monitoring
Information System (SAMIS) have also been operationalised using monitoring
arrangements. The micro-finance and linkage of the banks to the self- helpgroups / NGOs
and the issue of Kisan Credit Cards are among the recent developments in the area of rural
lending in India. The latest policy initiatives are the enabling of the Non-bank Financial
Companies and of the “correspondent “banking for increasing delivery of rural credit.
The experiment of having low cost institution for rural lending in the form of Regional
Rural Banks also has not been successful in as much as the RRB staff expenses are
required by law to be on par those of the commercial banks. Therefore, it is clear that the
rural credit delivery system is not performing efficiently and in a cost effective manner. It
is against this background that we position a technology based solution for improving the
speed efficiency and effectiveness of the credit delivery of the rural people through the
application of information technology tools and systems. We propose Model for using
Information Technology for improving rural credit delivery system by reducing the cost,
increasing the speed of delivery and also increasing the value addition in the service
delivery and improving the accountability. The National Agricultural Credit Review
Committee Report documents the history, development and the status of the various
important issues involved in rural credit delivery in India in great detail. It is interesting to
know from this voluminous report that solutions have been advised and implemented for
almost all the real as well as “perceived” problems in rural credit. Yet, this area remains a
problem defying adequate solution. For example, some of the key concerns like the end-
use of credit, infrastructure gaps, and the high costs of lending have been repeatedly
attended to. Despite that, the delivery of credit for agriculture and rural development still
remains unsatisfactory. It has been a matter of concern that the multi- institutional rural
credit delivery system has not been very successful in delivering required amount of credit
to agriculture and small scale industries and small and medium enterprises.i The share of
bank credit for agriculture has declined from 17.6 percent in 1985 to 9.8 percent in 2002.i
The institutions are in place, the systems repeatedly revamped several times on the basis of
multiple committees are also in place. In spite of this, the growths of the agricultural credit
in the country during the last three years have been less than the growth of credit for
services and corporate sector. The value addition to the GDP by the agriculture has been
low as compared to the industry sector and the services sector. The income disparities as
reflected in the poverty are still a matter of serious concern.
10
MAJOR RURAL BANKING PLAYERS IN INDIA
The State Bank of India is one of the major commercial banks having regional rural
banks. There are 30 Regional Rural Banks in India, under the State Bank of India and it
is spread in 13 states across India. The number of branches the SBI Regional Rural
Banks is more than 2000. Several other banks, apart from the State Bank of India also
functions as the promoter of rural development in India.
11
List of Regional Rural Banks in India.
There are a number of regional rural banks in India. Following are the state-wise list of
Indian regional rural banks.
Andhra Pradesh
Andhra Pradesh Grameena Vikas Bank
Andhra Pragathi Grameena Bank
Deccan Grameena Bank
Chaitanya Godavari Grameena Bank
Saptagiri Grameena Bank
Arunachal Pradesh
Arunachal Pradesh Rural Bank
Assam
Assam Gramin Vikash Bank
Langpi Dehangi Rural Bank
Bihar
Madhya Bihar Gramin Bank
Bihar Kshetriya Gramin Bank
Chhattisgarh
Chhattisgarh Gramin Bank
Surguja Kshetriya Gramin Bank
Durg-Rajnandgaon Gramin Bank
Gujarat
12
Dena Gujarat Gramin Bank
Baroda Gujarat Gramin
Saurashtra Gramin Bank
Haryana
Harayana Gramin Bank
Gurgaon Gramin Bank
Himachal Pradesh
Himachal Gramin Bank
Parvatiya Gramin Bank
13
The main purpose of the National Bank for Agriculture and Rural Development is to
provide credit for the development and publicity of small scaled industries, handicrafts,
rural crafts, village industries, cottage industries, agriculture, etc. The NABARD also
supports all other related economic operations in the rural sector, promotion of
sustainable growth in the rural sector. The NABARD also plays the role of a
contributor to the rural development by the means of promoting institutional
development, facilitating refinance to loan providers in the rural sector, inspection,
monitoring, and evaluation of client financial corporations. National Bank for
Agriculture and Rural Development (NABARD) was established as the premiere rural
development bank.
Syndicate Bank
The Syndicate Bank has it grass roots in the rural sector. The development of the
Syndicate Bank was in accordance to the development of the banking sector in India
and. The Syndicate Bank has performed actively in the development of the rural sector
in India.
The Regional Rural Banks in India has actively contributed to the growth of the rural
sector. The growth of the rural industries in India and the development of the rural
business and economy have been dependent largely on the investment and financial
aids provided by the Regional Rural Banks in India.
14
rural bank
Much of the success of RRB will depend on its structural soundness, adequacy of its
resources, management and operational efficiency and the role of associated agencies.
3) Deposit mobilization
15
As the deposits are the important sources of any bank and no less in the case of
RRBs , mobilization of rural savings is an essential part to build up their resources.
It appears that though the RRB made progress in the mobilization of rural savings,
there is much scope of further progress when it is considered in relation to the total
size of agricultural working population of the area of operation. For giving impetus
to such deposit mobilization in the long-run, the following measures may be kept in
view:
1. As an incentive to the rural depositors, RRB may be permitted to grant loans
against deposits upto a certain proportion of the face value of the deposits.
2. RRB may be included in the approved list of banks of central and state
governments for the purpose of keeping the surplus funds and operating the
accounts of government Departments, semi-government bodies, local bodies like
panchayats, Municipalities, Agricultural product market committee etc.
4) Borrowings
RRBs are promoted mainly for meeting the credit requirements of weaker sections
in the rural areas and so to refinance should fill the gap between mobilization of
own resources and the total funding requirements of the rural poor. As the deposit
mobilization potentially is not uniformly spread in the area of operation of all
RRBs, the NABARD general line of refinance should be maintained. RRBs must
immediately form technical cells, either by re-deploying their existing officers who
are otherwise qualified and suitable as mentioned earlier or by recruitment new
staff for preparing schemes so that covering of term loans under schematic lending
is stepped up. The necessary financial assistance for NABARD may be utilized by
the RRBs for the purpose. Sponser bank refinance is kept as last resort by RRBs
because of higher rate of interest at 81⅟ ₂ %, while the refinance from other sources
is cheaper. If it is desired to avail sponser bank refinance on a larger scale, in
preference to or on par with other refinance, it is necessary to consider whether the
rate of interest charged by sponser bank can be brought down to that of NABARDs.
RRBs are experiencing administrative and procedural inconvenience/ delays in
availing to refinance from IDBI in respect of their small loans. So it is felt that a
single agency approach ie. Obtaining refinance in respect of composite loans for
artisans and rural industries etc. from NABARD would facilitate easy availability
of refinance by RRBs.
16
RRBS IMPORTANT BANKING INDICATORS.
ABSTRACT
In India, the rural sector employs more than 70% of the workforce. There are
certain people who cannot access banking services in rural locations. To ensure
that people in rural India may access the financial system, India has created a
multi-layered approach. In an effort to restructure the weaker and poorer segments
17
of rural society, the Reserve Bank of India and the Indian government have
adopted the initiative of financial inclusion. Since the country's independence, the
decision-makers have understood the necessity and significance of banking
services nationwide. There are some studies, such as the "All India Rural Credit
Survey" and "All India Rural Credit Review," that have made it possible for
commercial banks to expand into rural areas and offer their banking services to a
significant number of people there.
It has been discovered that there is an increase in demand for rural financing for
infrastructure investment, production, farming, and consumer as well.
Commercial banks' assistance made rural banking exceedingly simple and
accessible.
Commercial banks encounter a number of difficulties when providing banking
services in rural areas, including high transaction costs, a lack of infrastructure,
employee resistance, a large number of accounts with very low balances, and
security issues when carrying and transmitting cash using mobile banking in
some far locations.
In 1904, during British administration, cooperative banks established themselves
in India. In 1935, during India's British administration, the Reserve Bank of
India was also established. Although though commercial banking dates back to
before our nation gained its independence, the "All India Rural Credit Survey"
(1954) marks the beginning of serious attempts to develop rural banking. The
"All India Rural Credit Review," completed in 1969, presented the idea of social
banking for commercial banking as a result of the nationalisation of major banks
in this series. Banking grew simpler as a result of the information technology
and communication's rapid growth and enhancement. Significant improvements
in the process for land mortgage loans and other bank borrowings are also
significant components to the banking company's achievements. Consumers are
faced with the problem of bribe and other concerns since there is more focus
placed on a significant paperwork load and because it demands numerous,
repeated trips to the bank branches. The cost of transactions to acquire loans
from banks for farmers and rural residents is increased as a result of all these
problems.
This problem has all the indicators of being an unfinished result of improper
authorisation of mandates to the booked business banks and RRBs in rearranging
tactics. Disentangling systems and simplicity in credit distribution require special
consideration in the context where banks are entrusted with the responsibility of
providing credit guidance to the growing network. A few issues that have emerged
as a result of a few investigations have also been presented. As it turns out, interest
rates on credit have increased in the provincial territories for both creation and
usage purposes. Rural banking is becoming a desirable proposition for commercial
banks.
CHAPTER 2
18
LITERATURE
REVIEW
19
20
OBJECTIVES
In fact, the real growth of Indian economy lied in the freeing of rural masses from acute
poverty,unemployment, and socio-economic backwardness.
Above all a rural bank has to help generally in the overall development of village in its
area. The banking commission held that rural banks should also extend credit and all
otherbanking services besides members/shareholders to the general public in their areas
by enrolling them as associate members.
21
The Commission also envisaged that all financial needs of the medium and
small farmers should be met by the rural banks
4. To study about Non institutional or private sources including money lender traders
commission agents and landlords.
In particular, the primary objective of rural banks is to meet the credit needs of
farmers and fishermen as well as of cooperatives and merchants in rural areas.
Regional rural banks (RRBs) provide critical development services and assist rural
residents in learning about digital banking services. Regional rural banks are vital
for financial inclusion and digital literacy in India's agriculture, and they play a
critical role in boosting digital literacy and economic growth.
Regional Rural Banks help the overall development of rural areas in the country. They
generate employment opportunities in such areas. They uplift the economy of rural
areas by providing them with credit facilities that people can utilize for running their
trade and business.
Banking with the specific needs of the community in mind.
1. Rural banking has helped in raising farm and non-farm out by providing
services and credit facilities to farmers.
22
2. It has helped in achieving food security which is reflected in the abundant stocks of
grains.
3. It provides long-term loans with better repayment options. It, thus helps in
eliminating moneylenders from the scene.
4. It had a positive effect on income and employment especially after the green revolution.
1. The formal institutions (except commercial banks) of rural credit have failed to
develop a culture of deposit mobilisation.
3. Vast proportion of rural households are out of the credit network as some kind
of collateral security is required for taking loan.
4. Small and marginal farmers receive only a very small portion of the institutional
credit as a large portion of institutional credit is taken away by the rich farmers.
Solutions to problems:
1. The banks should change their approach from just being lenders to building up
relationship banking with the borrowers.
3. The farmers should be guided how to make efficient utilisation of financial resources.
4. An effective mechanism for the recovery of agricultural loans should be evolved at the
earliest.
Cooperative credit societies in rural areas should be strengthened and their working should be
made transparent and efficient
23
CHAPTER 3
RESEARCH
METHODOLOGY
24
NEED FOR THE STUDY
RRBs were formed to serve the rural inhabitants of India, the majority who were not having access to
banking. There are many institutions set up by the state government and central government and some
in collaboration. The main objective of this institution is to serve the rural population. But the
question is how effectively these banks have performed? To accomplish the objectives of the
paper, we collected various data from secondary sources. We used several data published in
annual statistics of RRBs, several news articles, books, newspapers and internet.
Research in common parlance refers to a search for knowledge. The advanced learner’s
dictionary of current English lays down the meaning of research as “a careful investigation of
enquiry especially through search for new facts in any branch of knowledge.” The systematic
approach concerning generalization and the formulation of a theory is also research. The
purpose of research is to discover answers to questions through the application of scientific
procedures.
“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.”
- JOHN.W.BEST
Research may be defined as “any organized inquiry designed and carried out to provide
information for solving a problem”.
– EMORY
25
DESCRIPTIVE RESEARCH DESIGN:
Descriptive research design studies are those studies, which are concerned with describing
the character of a group. The researcher makes a plan of the study his research work. That
will enable the researcher to save and resources such a plan of study or blue print or study is
called a research design.
Three main purposes of research are to describe, explain, and validate findings. Description
emerges following creative exploration, and serves to organize the findings in order to fit
them with explanations, and then test or validate those explanations
The reason to adopt the descriptive research is due to the type of research question, design,
and data analysis that will be applied to a given topic.
Descriptive statistics tell what is, while inferential statistics try to determine cause and effect.
Descriptive research aims at fact finding & more often is based on surveys .It’s purpose to
describe the present state of affairs of the topic of study.
It is more focused than an exploratory study. It provides basic information for formulating
more sophisticated study.
26
CHAPTER 4
MAJOR FINDINGS
AND
INTERPRETATION
27
Rural banking in India has been an important area of focus for the government and the
banking sector, as it plays a crucial role in promoting financial inclusion and economic
development in rural areas.
1.The rural banking sector in India has undergone significant reforms in the past few decades,
with the government and the Reserve Bank of India (RBI) taking several measures to
improve access to financial services in rural areas.
2.Despite these efforts, a significant proportion of the rural population still remains unbanked
or underbanked. According to the latest data available from the RBI, only about 30% of rural
households have access to formal banking services.
3.Lack of financial literacy and awareness is one of the major barriers to the adoption of
formal banking services in rural areas. Many people in rural areas still prefer to use informal
financial channels, such as moneylenders and chit funds, due to a lack of understanding of the
benefits of formal banking.
5.The microfinance sector has emerged as an important player in rural banking in India,
providing small loans and other financial services to low-income households and small
businesses. However, there are concerns about the sustainability of the microfinance model
and the potential for over-indebtedness among borrowers.
6.There is a need for greater collaboration and coordination among different stakeholders,
including banks, government agencies, and NGOs, to ensure that rural banking initiatives are
effective and sustainable. This includes efforts to build the capacity of local institutions and
promote community participation in financial decision-making.
Overall, rural banking in India presents both challenges and opportunities for promoting
financial inclusion and economic development in rural areas. By addressing the barriers to
adoption of formal banking services and leveraging technology and innovative business
models, the sector has the potential to drive significant positive change in the lives of rural
communities.
28
ANALYSIS OF DATA
The instrument or tool that is used in the data collection of the research study is
QUESTIONNARIE. Questionnaire is the most common method used for primary data
collection by the researchers. It can be used for collecting quantitative or qualitative
information. A questionnaire is defined as a research instrument which consists of certain set
of questions with the aim to collect information from the respondent based on their opinions,
knowledge, attitudes and beliefs. It is a used as a tool to conduct a survey to get the
information of the research problem. The questionnaire used in this research study has been
framed on the basis of the employee’s experience working within the organisations. The data
collected with the help of the questionnaire is based on the recruitment & selection policies
and methods adopted by the company and their impact on the overall employees’
performance. Questionnaire is the most important tool and part of the research study as it
requires every information in detail. The questionnaire used in the study helps in getting the
employee’s true opinion about the company’s recruitment and selection policies and to check
whether these policies are effective or not for the employees as well as for the company itself.
Questionnaire used here forms the basis of the overall study. Now-a-days, Questionnaire is
the mostly commonly used instrument for collecting data. The researcher uses this instrument
for collecting data by framing certain questions for obtaining information from the
respondents
Sample is defined as a smaller set of data that the researcher selects from a large population
by using some pre-defined sampling method. It refers to a smaller, manageable set of large
population. A sample is a subset containing the features of large population.
SAMPLING
Sampling is a statistical tool which is used to indicate how much data to collect and how
often it should be taken. Sampling is a process in which a researcher selects a sample i.e.
smaller size from the whole population to make statistical inferences from it. It is cost-
effective and time convenient method.
29
SAMPLE SIZE
SAMPLE DESIGN:
POPULATION
SAMPLE PROCEDURES
➢In this study convenient sampling method was adopted. First each organization
was divided into different departments like Operations, CustomerServices, Human
Resources, Internet Marketing and under writing departments. From this department,
the respondents were selected on the basis of convenience.
INTERVEIW SCHEDULE
➢ The interview schedule has been used to collect the data. Information can be
gathered even when the respondents happen to be literate or illiterate.
TABULATION
30
TOOLS USED FOR ANALYSIS
➢ It is simple analysis tool. In this method, based on the opinions of the respondents,
percentage and bar chart is calculated for the respective scales of each factor.
Formula:
Simple percentage = No. of respondents x 100
Total no. of sample size
Hypothesis:
• Null Hypothesis:
• Alternative hypothesis:
The scope of present study is confined to Regional Rural Banks in India. The study mainly
involves the financial performance of Regional Rural Banks in India before and after
amalgamation. Similar studies on this line may be conducted for other banks in India and
outside India.
31
SAMPLING METHODS/TECHNIQUES
PROBABILITY SAMPLING
32
TYPES OF PROBABILITY SAMPLING
• Convenience sampling
• Judgmental or Purposive sampling
• Snowball sampling
• Quota sampling
33
SAMPLING METHOD USED IN THE STUDY
DATA ANALYSIS
• Descriptive analysis
• Regression analysis
• Factor analysis
• Time series analysis
• Dispersion analysis
34
DATA ANALYSIS AND INTERPRETATION
Interpretation:
44% of the respondent of rural bank says that Central Scheme to provide Interest
Subsidy for the period of moratorium on loans taken by farmer from economically
35
weaker sections from schedule banks under the loan scheme of the Indian Banks
Association to great extend where as none of the respondent of Urban Bank says that
Central Scheme to provide Interest Subsidy for the period of moratorium on loans
taken by farmer from economically weaker sections from schedule banks under the
loan scheme of the Indian Banks Association to great extend.
26% of the respondent of rural bank says that Central Scheme to provide Interest
Subsidy for the period of moratorium on loans taken by farmer from economically
weaker sections from schedule banks under the loan scheme of the Indian Banks
Association to great extend where as 72% of the respondent of Urban Bank says that
Central Scheme to provide Interest Subsidy for the period of moratorium on loans
taken by farmer from economically weaker sections from schedule banks under the
loan scheme of the Indian Banks Association to some extend.
10% of the respondent of rural bank says that Central Scheme to provide Interest
Subsidy for the period of moratorium on loans taken by farmer from economically
weaker sections from schedule banks under the loan scheme of the Indian Banks
Association to great extend to very little great extend where as 28% of the respondent
of Urban Bank says that Central Scheme to provide Interest Subsidy for the period of
moratorium on loans taken by farmer from economically weaker sections from
schedule banks under the loan scheme of the Indian Banks Association to very little
extend.
36
Interpretation:
37
3.Does your marketing policy of bank have a focus marketing on agro- sector?
38
Interpretation:
83% of the respondent of Rural Bank strongly agree that Marketing policy of bank
have a focus marketing on agro- sector where as 61% of the respondent of Urban
Bank also strongly agrees that Marketing policy of bank have a focus marketing on
agro- sector.
17% of the respondent of Rural Bank agree that Marketing policy of bank have a
focus marketing on agro- sector where as 23% of the respondent of Urban Bank also
agrees that Marketing policy of bank have a focus marketing on agro- sector.
None of the respondent of Rural Bank disagree that Marketing policy of bank have a
focus marketing on agro- sector where as 16% of the respondent of Urban Bank also
disagree that Marketing policy of bank have a focus marketing on agro- sector.
None of the respondent of Rural Bank & Urban Bank also strongly disagree that
Marketing policy of bank have a focus marketing on agro- sector.
None of the respondent of Rural Bank & Urban Bank can’t says that Marketing policy
of bank have a focus marketing on agro- sector.
39
4) Multiple ‘basic’ financial services and loan gateway is product marketing of the bank?
□ Yes □ No
Interpretation:
87% of the respondent of Rural Bank says that Multiple ‘ basic’ financial services
and loan gateway is product marketing of the bank where as 62% of the respondent
of Urban Bank also says that Multiple ‘ basic’ financial services and loan gateway is
product marketing of the bank.
13% of the respondent of Rural Bank sasys that Multiple ‘ basic’ financial services
and loan gateway is product marketing of the bank where as 38% of the respondent
of Urban Bank also says that Multiple ‘ basic’ financial services and loan gateway is
product marketing of the bank.
40
5) Devised to ensure usage as well as profitability Quantity discounts, and ease in payment
modes is pricing marketing of the bank.
□ Yes □ No
Interpretation:
11% of the respondent of rural bank says that Devised to ensure usage as well as
profitability Quantity discounts, and ease in payment modes is pricing marketing of the
bank. whereas 13% of the respondent of Urban Bank also says that Devised to ensure
usage as well as profitability Quantity discounts, and ease in payment modes is pricing
marketing of the bank..
89% of the respondent of rural bank says that Devised to ensure usage as well as
profitability Quantity discounts, and ease in payment modes is pricing marketing of the
bank. whereas 87% of the respondent of Urban Bank also says that Devised to ensure
usage as well as profitability Quantity discounts, and ease in payment modes is pricing
marketing of the bank.
41
6) Comprehensive offering of different services is placement marketing of the bank?
□ Traditional □ Modern
Interpretation:
98% of the respondent of rural bank says that Comprehensive offering of different
services is placement marketing of the bank where as 91% of the respondent of Urban
Bank says that Comprehensive offering of different services is placement marketing
of the bank.
42
7) Collaborating with NGO’s to development Knowledge marketing of the bank ?
□ Yes □ No
Interpretation:
33% of the respondent of RURAL BANK says that Collaborating with NGO’s to
development Knowledge marketing of the bank where as 81% of the respondent of
Urban Bank also says that Collaborating with NGO’s to development Knowledge
marketing of the bank.
67% of the respondent of RURAL BANK says that Collaborating with NGO’s to
development Knowledge marketing of the bankwhere as 19% of the respondent of
Urban Bank says Collaborating with NGO’s to development Knowledge marketing
of the bank.
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CHAPTER 5
CONCLUSION
44
RRBs' performance in respect of some important indicators was certainly better than that of
commercial banks or even cooperatives. RRBs have also performed better in terms of
providing loans to small and retail traders and petty non-farm rural activities. In recent years,
they have taken a leading role in financing Self-Help Groups (SHGs) and other micro-credit
institutions and linking such groups with the formal credit sector.
RRBs should really be strengthened and provided with more resources with which they can
undertake more of these important activities. And most certainly they should be kept apart
from a profit-oriented corporate motivation that would reduce their capacity to provide much
needed financial services to the rural areas, including to agriculture. Ideally, the best use of
the resources raised by RRBs through deposits would be through extensive cross
subsidisation. This, in turn, really requires an apex body that would cover and oversee all the
RRBs, something like a National Rural Bank of India (NRBI).
The number of rural branches should be increased rather than reduced; they should be
encouraged to develop more sophisticated methods of credit delivery to meet the changing
needs of farming; and most of all, there should be greater coordination between district
planning authorities, Panchayati raj institutions and the banks operating in rural areas. Only
then will the RRBs fulfill the promise that is so essential for rural development.
So through this detailed study and project report about RRBs, we learnt about their history,
past performances, present situations as well as probable future scenario. They have
contributed huge to develop rural economy as well as overall Indian economy. So if
amalgamation happens, After the Amalgamation, with the help of computerization, newer
and upgraded technologies, efficiency increases, moreover the rural people who have not
availed the banking service are the prospective customers, all these will give positive results,
the incurred loss will be recovered and the objective for which the Regional Rural Banks are
operating will prove to be a successful one. The Regional Rural Banks are trying hard to
achieve the social objectives which are providing services to the rural mass that are under
privileged. So let’s hope that whatever the Indian government will decide about Regional
Rural Banks, will be fruitful for all, specially for the rural people of our country.
45
CHAPTER 6
LIMITATIONS
46
LIMITATIONS OF THE STUDY
Thus the respondents are not come forward to provide their feedback regarding their
organization than the result is bias.
In this study the sample size is 70. The result might vary when the sample size values
changes it.
Researcher fined the difficulty in searching the appropriate advisor and respondent
throughout the city.
The research was limited to the Bhopal city.
47
ANNEXURE
48
NAME:
DESIGNATION:
Central Scheme to provide Interest Subsidy for the period of moratorium on loans taken by
farmer from economically weaker sections from schedule banks under the loan scheme of the
Indian Banks Association?
To what extent is Sales Promotions have been used by banker to increase sales in the short
term?
a) Completely b) Partially c) Nil
Multiple ‘basic’ financial services and loan gateway is product marketing of the bank?
a) Yes b) No
Devised to ensure usage as well as profitability Quantity discounts, and ease in payment
modes is pricing marketing of the bank?
a) Yes b) No
49
a) Yes b) No
BIBLOGRAPHY
AND
REFERNCES
.
50
BIBLIOGRAPHY
Books:
Chatterjee, Jauchius, Kaas and Satpathy no. 1, (2002): 'Revving up auto branding',
McKinsey Quarterly.
David. A. Aaker, V.Kumar & George S. Day, (2001) Descriptive Research: Marketing
Research, Seventh Edition, pp 17
Kotler, Philip. (1999):’Marketing Management’ Prentice Hall Of India Pvt. Ltd., New
Delhi.
Magazines:
Business Today
Business Week.
Business World
Newspapers
Economic Times
The Hindu
Times of India
51
PLAGIARISM REPORT
52
53
54
55
56
57