Sulfath Intro 12345 (7)

Project Report 2022-2023
CHAPTER I
INTRODUCTION
College of Applied Science, Vadakkencherry 1

1.1 INTRODUCTION
The main function of the bank is to provide easy and affordable access to the
financial products and services to all sections of the society. Banking
activities are the back bone of the economy. Bank branches have significantly
increased the rural area across the country. With the launch of Pradhan Mantri
Jan Dhan Yojana, our government is now focusing on the untapped rural
masses which do not having savings or investment habits. The aim of the
scheme is to include the poorest in the financial ambit and make them aware
and financially literate. With the view of such remarkable effort by the
government, this study aims to analyse the banking habit of people residing in
rural area of puthucode grama panchayath.
Banking habits can be analysed on the basis of frequency of bank visit,

account maintenance in terms number of transaction, types of account,
facilities availed in terms of ATM, credit/loan taken, money transfer, making
deposit, savings etc. Still there is a remarkable need of tapping the financially
excluded population more specifically in rural areas and poor people residing
in urban area. The reason of financially exclusion can be many such as: lack
of sufficient identify documents, less education, unawareness, unfamiliarity
with the products and services, bank distance or bank timing etc. Analysing
all the problems and challenges faced by a house hold will give insight in
terms of improving banking habit of the people and motivate them to avail
formal financial services rather than getting trapped into informal financial
sector. Banking is the backbone of economic activity of any economy.
Without banking sector, fruit of the economic development will be dream and
no economic activity take place.

Banking sector not only facilitates trade but also helps the economy to run
faster as creating multiple employment opportunities by expanding branches
in rural and offering novel services.
1.2 STATEMENT OF THE PROBLEM
This paper makes an attempt to know the banking habit of people in rural
area. It is true that rural people don’t enjoy the benefit of banking services as
enjoyed by urban customers. There are many reasons for poor banking habit
of rural people. Earlier days, the financial institutions were reluctant to
establish their branches in rural area as they find them financially unviable but
the trend has changed over due to competition the banking institutions aims to
add up their consumer base and therefore they started or expanded their
branches in rural area. The people in the rural areas are illiterate and are
unaware of many modern banking services. This fact further ignites the need
for the research on banking habits in the state at micro level and to find out
the reasons for poor banking. Banking is important in one’s life to have a
social protection to him/herself and to dependents in this absence. Further
banking sector is growing leaps and bounds in the states and the rural sector is
still untapped for both savings and the investment. It is necessary to know the
level of awareness on banking and its services, reasons for poor usage of
banking services and to get suggestions to improve the banking service usage
patterns among the rural mass. This can helps to identify the bottlenecks in
the present study is to focus and help in improving the banking habits among
the rural mass. This can have a better path for the success of the rural mass in
improving the standard of life in micro level and helps an economy to have
balanced regional development. In this scenario the present study attempts to
examine the reason for banking habit among the rural people.

1.3 OBJECTIVES OF THE STUDY
• To find out the awareness level of banking services among the rural
People.
• To find out the factors influencing banking services among rural people
in Puthucode panchayath.
• To study the problem availing banking services among the consumers
in rural area.
1.4 SCOPE OF THE STUDY
The main aim of the study is to examine the banking habit of rural people in
puthucode panchayath. The study focus on the level of awareness about the
banking service among rural people. The study also find out the factors
influencing banking services among rural people. The study also analyse the
problems availing banking services among the consumers in rural area.
1.5 RESEARCH METHODOLOGY

Research methodology is the specific procedure or techniques used to
identify, select, process and analyse information about a topic. In a research
paper, the methodology section allows the reader to critically evaluate a
study's overall validity and reliability.
1.5.1 RESEARCH DESIGN
The study is descriptive & analytical in nature. It intends to explore the

problems of banking habit of rural people in Puthucode Panchayath. The data
for the study was gathered through a structured questionnaire. A direct study
was used to collect the data for this study.

1.5.2 SOURCE OF DATA
The study is based on both primary and secondary data.
Primary data - primary data is collected through a well structured

questionnaire the data is collected directly from the rural people.
Secondary data - secondary data is collected from various websites,

magazines and other articles.
1.5.3 SAMPLING TECHNIQUE
Since it is difficult to study the entire population sampling technique is

adopted. The people in the area of Puthucode Panchayath were interviewed
using convenience sampling method.
1.5.4 SAMPLE SIZE
The sample size of 50 people are taken for the study.
1.5.5 TOOLS FOR ANALYSIS
Simple percentage analysis
Simple percentage analysis refers to a special kind of rates, percentage are

used in making comparison between two or more series of data. A percentage
is used to determine relationship between the series.
1.5.6 PERIOD OF STUDY
The present study covers of 21 days.
1.6 LIMITATIONS OF THE STUDY
• The present study was conducted in Puthucode Panchayath in Palakkad

district which will not infer the result for the remaining part of state.

• The respondents are also from different categories influenced by the

banking habit of rural area.
• The finding of the study depends on the selected rural area of bank.
• The study period limited to only 21 days.
1.7 SCHEME OF PRESENTATION
The study is presented in 5 chapters as follows:
Chapter 1- Introduction
Chapter 2- Review of literature
Chapter 3- Theoretical review
Chapter 4- Data Analysis and Interpretation
Chapter 5- Findings, suggestions and conclusion

CHAPTER II
REVIEW OF LITERATURE

REVIEW OF LITERATURE
Review of literature is an indispensable part for any research work. A

literature review which is being sorted and arranged in proper way leads to
extract the relevant findings and ascertaining the gaps or linkages in
researches made so far in the specific subject or area. In this chapter
researcher has undertaken an extensive survey of literature connected with the
present research problem related to awareness level of respondents towards
different banking services, service quality aspects of banks, customer
satisfaction etc. It includes the various reviews of literature done in the Indian
context as well as globally.
1. Dr. B. Maheshwari (2021) focused in the study entitled as “Customer

Perception towards Banking Habits in Rural Area (An Empirical Study with
Special Reference to Coimbatore City) on the banking habits of customers in
rural areas. Study also analysed the influence of demographic status of
customers on their level of perception towards their service quality
dimensions. For this purpose, study collected 67 the primary data from the
sample of 250 respondent of Coimbatore city regarding their demographic
profile, banking habits, perception level, and satisfaction level of the
customers towards the service quality. In banking habits, study found that
majority of the respondents having saving bank account.
2. Dr. A. Vinayagamoorthy and J. Merlin Sheela Magdaline (2021) , in
their study entitled as “A Study on Customers’ Attitude towards Service
Quality of Private Sector Banks in Krishnagiri District” measured the
customer attitude towards service quality of private sector banks in
Krishnagiri district. Study used the several methodology with five
dimensions on which perception of private bank customers were collected.
Study selected the customers of private sector banks of ICICI, HDFC,
KOTAK and INDUSIND bank. Study found reliability and responsiveness

as major factor in service quality perception. Study suggested that
employees of bank must be trained in terms of innovative technology which
helps the banks in providing quick and prompt services to their customers.
3. Dr. D. Mutusamy (2020) in his study entitled as “Impact of Profile
Variables on Level of Satisfaction: A Study on Private Sector Banks in
Trichy District” measured the relationship between respondents‟
demographic profile with level of satisfaction of customer from banking
services. For collection of data, pilot study was 64 conducted in bank
branches of rural, urban, semi urban area. Study selected the private sector
banks i.e. ICICI, HDFC, City Union Bank, Lakshmi Villas and South Indian
Banks. Chi square analysis was used for statistical analysis. Significant
relationship was found among monthly income and satisfaction level.
However the study found that level of satisfaction of customer is
independent from the age of respondents. Study recommended for Total
Customer Satisfaction.
4. Dr. V. Mahalakshmi and Dr. P.Na. Kanchana (2020) in their paper
entitled as “Customer Expectation towards the Services Offered by Banking
Sector in Tamil Nadu” had explored the various services provided by
banking sector to satisfy the customer expectations. Study focused on
various services i.e. NEFT, ATM facilities, Core Banking, Mobile Banking,
Internet Banking, M-Pesa, Credit Card, Debit Card facilities, SWIFT, e-
payments system. Study stressed on customer expectations towards the
banking services. Study suggested for various measures for customer
satisfaction. Study explained that banks should know their customers
requirement and cater them accordingly and also suggested for providing
differentiating experiences to the loyal customers. Bank must also introduce
simple and easy process of services to increase the customer satisfaction.

Study also suggested for increase the service quality in terms of reliability,
assurance, empathy, responsiveness in the providing services.
5. Rashed Al Karim and Tabassum Chowdhary (2020) measured in their
research paper “Customer Satisfaction on Service Quality in Private
Commercial Banking Sector in Bangladesh”, the impact of service quality
on satisfaction of customer from private banks in Bangladesh. Study used
the primary data of 110 customers of selected private banks available at the
city of Chittangomg of Bangladesh. Selected banks were Dhaka Bank, Bank
Asia, the Standard Charted Bank, City bank, Eastern Bank Ltd. And Dutch
Bangla Bank. Study was based on five dimensions of SERVQUAL model
suggested by Parsuraman, Zeithama and Beery (1985). Results of the study
revealed positive and significant impact of five dimensions on satisfaction of
selected banks customers. Results emphasized that service quality
dimensions of private banks of Bangladesh are crucial for customer
satisfaction.
6. Dr. B.S. Sharma and Preeti Aggarwal (2019) in their research paper
entitled as “Customer Satisfaction in Commercial Banks a Case Study of
Bank of Baroda” examined the customer satisfaction from Bank of Baroda.
Study also identified the key actions which necessary for retaining the
customer in banking sector for long term. A sample of 50 respondents was
selected from Bank of Baroda located in Faridabad for the sake of collection
of primary data. Study made comparison among ‘ATM Banking’, ‘Branch
Banking’, ‘Mobile Banking’ and ‘Internet Banking’. Study found that most
of the respondents are aware from the mobile banking. Customers found
satisfied with ATM services of banks. However, study found the customer
dissatisfaction due to the behaviour, attitude of bank staff in the banks and
delay in processing of transaction. Study found time is the most important
factor which affects the quality and reputation of bank.

7. Divya Joseph (2019), studied the intensity of financial inclusion and

financial literacy among the respondents and found that majority of the
respondents preferred savings account and ease of access and convenience
were major factors that motivated the respondents towards account opening.
8. J.J. Navaratnaseelana and P.Elang Kumaranb (2018) , in their study
entitled as “Impact Of Service Quality on Customer Satisfaction: A Study on
Customers on Commercial Bank of Ceylon PLC Trincomalee District”,
focused on service quality’s impact on customer satisfaction. For this
purpose, study has taken the five dimensions on SERVQUAL. Further study
considered all these five dimensions as independent variable whereas,
satisfaction of customers as independent variable. Primary data was taken
from 56 customers in Trincomalee district. Study used the inferential
statistics for data analysis. The results of the study from Pearson correlation
analysis showed positive and significant correlation analysis showed
positive and significant correlation among both constructs.
9. Ravi C. S. and Kundan Basavaraj (2018) An attempt is made in their
study entitled as “Customer Preference And Satisfaction Towards Banking
Services With Special Reference To Shivamogga District In Karnataka”
examined the satisfaction level and preference of customer regarding
banking services. Study made a comparative analysis of these selected two
constructs among public and private sector banks. From this study,
researchers have predicted the overall satisfaction and dissatisfaction among
the customers towards the services of bank deposit, loan service, value
added services and insurance services.
10. Dr. G. Nagarajan et.al (2018) in their study entitled as “A Study on
Customer Awareness towards Loan Products & Services in Bangalore with
special Reference to State Bank of India”, measured the awareness level as
well as satisfaction level of customers towards selected loan services offered
by SBI. Study was based on primary data. For collection of primary data,

220 respondents were selected of SBI from Bangalore region. The study
used the statistical techniques like chi-square and ANOVA for the analysis
of the data. Further study found low awareness among female respondents
than male respondents on loan products and services. Study also revealed the
significant difference among customer awareness level towards the interest
charges, growth benefits and credit sores according to their occupation.
11. Dileep S. & Dr. G.V. Kesava Rao (2018) has dealt in their research paper
entitled as “A Study on Indian Rural Banking Industry- Issues And
Challenges” with the issue of usage of bank services by the rural customers
and various challenges faced by rural banking. This study was limited to the
rural banks and used the financial data. Study ascertained the various reasons
for being unprofitable of rural banking in India i.e. high non performing
loans, high cost to serve, and high risk of credit and information asymmetry
among rural customer. Study found different significant opportunities for
banks in the field of rural banking. Study suggested that there must be a
coordinated and concerted efforts by the government of India, RBI and the
commercial banks to establish an inclusive financial system. Further study
suggested that bank must tailor their products and services mix to meet the
rural customers‟ need of banking facilities.
12. V. Jain and et.al. (2017) in their paper entitled as “Customer Perception
On Service Quality In Banking Sector With Special Reference To Indian
Private Banks In Moradabad Region” aimed at the analysis of service quality
of four private banks i.e. HDFC, ICICI, KOTAK and IndusInd Bank of
Moradabad region. In the study, HDFC bank found as highest perceived
quality of service among the selected four banks. Study also revealed that
dimension of ‘reliability’, ‘responsiveness’ were as important factors in
gaining the highest perception score for quality of service.

13. K.T. Geetha & V. Malarvizhi (2017) , in their research paper entitled as,
“Acceptance of E-Banking among Customer (An Empirical Investigation)”,
examined the various factors which reflect the acceptance of e banking
services. Study also focused on issues related to security and privacy
required in Indian banking system. Study collected the primary data with the
help of purposing sampling method from the 200 bank customers of 19
commercial banks situated at Coimbatore city. For analysing the collected
data researchers used various descriptive and inferential statistics like
regression and factor analysis. The results revealed from the study indicated
that security issues, privacy matters and awareness of customer were the
major factors for affecting the acceptance of e banking services among
selected customers. For enhancing the maximum adoption of e-banking
services among customers, banks must ensure the safety of customer account
and provide the necessary guidance to customers.
14. Santhiyavalli (2017) in her research paper entitled as “Customer
Perception of Service Quality of State Bank of India – A Factor Analysis”;
made an effort for calculating the gap scores for service quality of State
Bank of India. The highest average gap score was found in the dimension of
empathy. From the results of factor analysis, study found the dimensions viz.
‘Reliability’, ‘Responsiveness’, ‘Empathy’ and ‘Tangibility’ as major factors
which has high effect on satisfaction of bank customers. Study suggested
that service quality act as weapon in this competitive scenario to enhance the
customer satisfaction.
15. Dr. K. Ravichandran, Dr. S. Prabhakaran, S. Arun Kumar (2017) in
their article entitled as “Application of SERVQUAL Model on Measuring
Service Quality: A Bayesian Approach”, analysed the perceived quality of
service and its impact on customer satisfaction. It used a Bayesian approach.
The study focused on Bayesian framework in case of private sector banks

available at Trichirappalli district of Tamil Nadu. The article showed that

banks retain its valuable customer with maximum customer satisfaction by
improving it quality of service. Study collected the primary data using
structured questionnaire of SERVQUAL from the sample size of 500
respondents of private banks in Tirchirappalli district of Tamil Nadu.

CHAPTER III
THEORETICAL FRAMEWORK

THEORETICAL FRAMEWORK
BANKING
Banking is defined as the business activity of accepting and safeguarding

money owned by other individuals and entities, and then lending out this
money in order to conduct economic activities such as profit or simply
covering operating expenses.
BANKING HABIT
Banking habit can be analysed on the basis of frequency of bank visit, account
maintenance in term numbers of transaction, type of account, facility availed
in terms of ATM, credit/loan taken, money transfers, money deposit, savings
etc. A Bank is a lawful organisation that accepts deposits that can be
withdrawn on demand. Banks are institutions that help the public in the
management of their finances, public deposit their savings in banks with the
assurance to withdraw money from the deposits whenever required.
Banks accept deposits from the general public and from the business
community as well and give two assurances to the depositors –
1. Safety of deposit
2. Withdrawal of deposit, whenever needed
Banks give interest on deposits which adds to the original deposit amount and
is a great incentive to the depositor. This promotes saving habits among the
public. Bank also grants loans based on deposits thereby adding to the
economic development of the country and well being of the general public.
With this stature, it becomes important to understand the major functions of a
bank.

Important Functions of Bank
There are two types of functions of banks:
1. Primary functions – being primary are also called banking functions.
2. Secondary Functions
Both the types of functions of bank are explained below in detail:
Primary Functions of Bank All banks have to perform two major primary
functions namely:
1. Accepting of deposits
2. Granting of loans and advances
Accepting of Deposits
A very basic yet important function of all the commercial banks is mobilising
public funds, providing safe custody of savings and interest on the savings to
depositors. Bank accepts different types of deposits from the public such as:
1. Saving Deposits: encourages saving habits among the public. It is suitable

for salary and wage earners. The rate of interest is low. There is no restriction
on the number and amount of withdrawals. The account for saving deposits
can be opened in a single name or in joint names. The depositors just need to
maintain minimum balance which varies across different banks. Also, Bank
provides ATM cum debit card, cheque book, and Internet banking facility.
2. Fixed Deposits: Also known as Term Deposits. Money is deposited for a

fixed tenure. No withdrawal money during this period allowed. In case
depositors withdraw before maturity, banks levy a penalty for premature
withdrawal. As a lump-sum amount is paid at one time for a specific period,
the rate of interest is high but varies with the period of deposit.
3. Current Deposits: They are opened by businessmen. The account holders

get an overdraft facility on this account. These deposits act as a short term
loan to meet urgent needs. Bank charges a high-interest rate along with the
charges for overdraft facility in order to maintain a reserve for unknown
demands for the overdraft.
4. Recurring Deposits: A certain sum of money is deposited in the bank at a

regular interval. Money can be withdrawn only after the expiry of a certain
period. A higher rate of interest is paid on recurring deposits as it provides a
benefit of compounded rate of interest and enables depositors to collect a big
sum of money. This type of account is operated by salaried persons and petty
traders.
Granting of Loans & Advances
The deposits accepted from the public are utilised by the banks to advance
loans to the businesses and individuals to meet their uncertainties. Bank
charges a higher rate of interest on loans and advances than what it pays on
deposits. The difference between the lending interest rate and interest rate for
deposits is bank profit.
Bank offers the following types of Loans and Advances:
1. Bank Overdraft: This facility is for current account holders. It allows

holders to withdraw money anytime more than available in bank balance but
up to the provided limit. An overdraft facility is granted against collateral
security. The interest for overdraft is paid only on the borrowed amount for
the period for which the loan is taken.
2. Cash Credits: a short term loan facility up to a specific limit fixed in

advance. Banks allow the customer to take a loan against a mortgage of
certain property (tangible assets and / guarantees). Cash credit is given to any
type of account holders and also to those who do not have an account with a

bank. Interest is charged on the amount withdrawn in excess of the limit.

Through cash credit, a larger amount of loan is sanctioned than that of
overdraft for a longer period.
3. Loans: Banks lend money to the customer for short term or medium
periods of say 1 to 5 years against tangible assets. Nowadays, banks do lend
money for the long term. The borrower repays the money either in a lumpsum
amount or in the form of instalments spread over a predecided time period.
Bank charges interest on the actual amount of loan sanctioned, whether
withdrawn or not. The interest rate is lower than overdrafts and cash credits
facilities.
4. Discounting the Bill of Exchange: It is a type of short term loan, where

the seller discounts the bill from the bank for some fees. The bank advances
money by discounting or purchasing the bills of exchange. It pays the bill
amount to the drawer(seller) on behalf of the drawee (buyer) by deducting
usual discount charges. On maturity, the bank presents the bill to the drawee
or acceptor to collect the bill amount.
Secondary Functions of Bank
Like Primary Functions of Bank, the secondary functions are also classified
into two parts:
1. Agency functions
2. Utility Functions
Agency Functions of Bank
Banks are the agents for their customers, hence it has to perform various
agency functions as mentioned below:

Transfer of Funds: Transferring of funds from one branch/place to another.

Periodic Collections: Collecting dividend, salary, pension, and similar
periodic collections on the clients’ behalf.
Periodic Payments: Making periodic payments of rents, electricity bills, etc

on behalf of the client.
Collection of Cheques: Like collecting money from the bills of exchanges,

the bank collects the money of the cheques through the clearing section of its
customers.
Portfolio Management: Banks manage the portfolio of their clients. It

undertakes the activity to purchase and sell the shares and debentures of the
clients and debits or credits the account.
Other Agency Functions: Under this bank act as a representative of its

clients for other institutions. It acts as an executor, trustee, administrators,
advisers, etc. of the client.
Utility Functions of Bank
• Issuing letters of credit, traveller’s cheque, etc.

• Undertaking safe custody of valuables, important documents, and
Securities by providing safe deposit vaults or lockers.
• Providing customers with facilities of foreign exchange dealings
• Underwriting of shares and debentures
• Dealing in foreign exchanges
• Social Welfare programmes
• Project reports
• Standing guarantee on behalf of its customers, etc.

TYPES OF BANK ACCOUNT
Saving Account
The facility of saving account are only for savings purpose, and a bank is
liable to pay interest on the fund which are deposit in the account. In India,
the rate of interest for savings accounts ranges from anywhere between 4% to
7%.
Current Account
Current account mainly contains liquid deposit that are utilized for business
purpose and not for savings or investments. No interest is paid on such an
amount, and there are no maturity period as well due to the continuous nature
of account.
Fixed Deposit Account
A particular sum of money is deposited in a fixed deposit account for a given

duration. If deposit is taken out before maturity date, penalties will be
imposed. Fixed deposit enjoy higher interest rates. The interest rate is
subjected to variation from bank to bank and also periodic revisions.
Recurring Deposit Account
In case of recurring deposit account, deposit will to be made by the account

holder at regular intervals for a specified time period. The bank will have to
pay the relevant rate of interest when the amount is repaid after the fixed time
period.

TYPES OF BANK
Central Bank
The central bank in the country is the Reserve Bank of India (RBI) which act
as the apex body of regulating and monitoring all other bank in the country. It
also act as banker to the government in certain situations. RBI is instrumental
in lying down the repo rate, reserve repo rate, cash reserve ratio and statutory
liquidity ratio.
Commercial Bank
Commercial bank perform the function for the public in term of accepting
profits or extending loans. These loans act as investment of the commercial
banks with the objective of earning profit. Examples of commercial bank in
India are State Bank of India, United Bank of India, ICICI Bank, HDFC Bank
etc.
Specialised Bank
Specialised banks are formed with the specific goals of creating to a particular
industry or sector. It may focus on export and import or provide financial
services to some specific industries. Example of a specialised bank in India is
Export Import Bank.
Corporative Bank
Cooperative bank in India are established under the state cooperative societies
Act, providing easy credit to the member of the cooperative banks. One of the
core function of the cooperative bank is to provide financial resources to the
rural population at large. Examples of cooperative bank in India are – New
India Cooperative Bank Limited, Ahmedabad Mercantile Co-operative Bank
Ltd.
The functions of commercial bank are given below:
A: General Functions:
1. Receiving Deposits:
The first and foremost function of commercial bank is to receive or collect

deposits from the public in different forms of accounts e.g. current, savings,
term deposits. No interest is charged in the current account, lower rate of
interest is charged in the savings account and comparatively higher interest
rates charged in fixed deposits. Thus, commercial bank builds up customer
network.
2.Accommodation of loans and advances:
Commercial Bank attaches much importance to providing loans and advances

at a higher rates than the deposit rates and thus earns profits on it. Working
capital is accommodated to the borrower for expansion and smooth running of
business. In the similar manner, commercial bank extends financial
accommodation for the development of agriculture 6 and industry. Credit
accommodation is provided to the entrepreneurs for reviving sick and old
industries as per Govt. directives. Thus, commercial bank also extends
welfare services to the people at large.
3.Creation of Loan Deposits:
Commercial Bank not only receives deposits from public and accommodates
loans to public but also creates loan deposits. For example: while disbursing
loans as per sanction stipulation, the amount of loan is credited to the
borrower’s account. The borrower may not withdraw the full amount at a
time. The residual amount i.e. balance left in the account creates loan
deposits.

4.Creation of medium of exchange:

Central Bank has got exclusive right to issue notes. On the other hand,
Commercial Bank creates medium of exchange by issuing cheques. Like
notes, cheque is transferrable being popularly used in the banking
transactions.
5. Contribution in foreign trade:
Commercial Bank plays a vital role in expediting foreign exchange and

foreign trade business e.g. import, export etc. It contributes greatly in the
economy through import finance and export finance and thus, earn foreign
exchange for the country.
6. Formation of capital:
Commercial Bank extends financial assistance for the formation of capital in

the trade, commerce and industry in the country which expedites its economic
development.
7. Creation of Investment Environment:
Commercial Bank plays a significant role in creating investment

environments in the country.
B. Public Utility Functions:
1. Remittance of Money:
Remittance of money to the public from one place to another is one of the
functions of commercial bank. Remittance is effected in the form of demand
draft ,telegraphic transfer etc. through different branches and correspondents
home and abroad.

2. Help in trade and commerce:
Commercial Bank helps expand trade and commerce. In inland and foreign
trade customers are allowed credit accommodation in the form of letter of
credit , bill purchased and discounted etc.
3. Safe custody of valuables:
Commercial Bank introduces „locker‟ services to the customers for safe

custody of valuables e.g. documents, shares, securities etc.
4.Help in Foreign Exchange business:
While opening letter of credit , commercial bank obtains credit report of the
suppliers and thus help expedite import and export business.
5. Act as a Referee:
Commercial Bank acts as a referee for and on behalf of the customers.
6. Act as an Adviser:
Commercial Bank provides valuable advice to the customers on different

products, business growth and development, feasibility of business and
industry.
7.Collect utility service bills:
As a social commitment, Commercial Bank collects utility service bills e.g.

water, electricity, gas, telephone etc. from the public.
8.Purchase and sale of prize bonds, sanchayapatra, shares etc.
Commercial Bank undertakes to purchase and sale of prize bonds, sanchaya

patra, shares etc. as a part of social commitment.

9.Help people travel abroad:
Commercial Bank helps customers in traveling abroad through issuance of

travelers cheques, drafts, cash etc. in favour of the customers.
C. Agency Functions:
1. Collection and payment:
Commercial Bank is engaged in collection and payment of cheque, bill of

exchange, promissory notes, pension, dividends, subscription, insurance
premium, interest etc. on behalf of the clients.
2.Purchase and sale of shares and securities:
Commercial Bank is entrusted with the responsibility of purchase and sale of

shares and securities on behalf of the customers.
3.Maintenance of secrecy:
Maintenance of secrecy is one of the most important functions of commercial

bank.
4.Act as a trustee:
Commercial Bank acts as a trustee on behalf of the customer.
5. Economic Development and Welfare activities:
Commercial Bank contributes much for the welfare and economic

development of the country.

IMPORTANT SCHEMES
Pradhan Mantri Jan Dhan Yojana (PMJDY)
Prime Minister announced Pradhan Mantri Jan Dhan Yojana as the National
Mission on Financial Inclusion in his Independence Day address on 15th
August 2014, to ensure comprehensive financial inclusion of all the
households in the country by providing universal access to banking facilities
with at least one basic bank account to every household, financial literacy,
access to credit, insurance and pension facility. Under this, a person not
having a savings account can open an account without the requirement of any
minimum balance and, in case they self-certify that they do not have any of
the officially valid documents required for opening a savings account, they
may open a small account. Further, to expand the reach of banking services,
all of over 6 lakh villages in the country were mapped into 1.59 lakh Sub
Service Areas (SSAs), with each SSA typically comprising of 1,000 to 1,500
households, and in the 1.26 lakh SSAs that did not have a bank branch, Bank
Mitras were deployed for branchless banking. Thus, PMJDY offers unbanked
persons easy access to banking services and awareness about financial
products through financial literacy programmes. In addition, they receive a
RuPay debit card, with inbuilt accident insurance cover of Rs. 2 lakh, and
access to overdraft facility upon satisfactory operation of account or credit
history of six months. Further, through Prime Minister’s Social Security
Schemes, launched by the Hon’ble Prime Minister on 9th May 2015, all
eligible account holders can access through their bank accounts personal
accident insurance cover under Pradhan Mantri Suraksha Bima Yojana, life
insurance cover under Pradhan Mantri Jeevan Jyoti Bima Yojana, and
guaranteed minimum pension to subscribers under Atal Pension Yojana.
PMJDY was conceived as a bold, innovative and ambitious mission. Census
2011 estimated that out of 24.67 crore households in the country, 14.48 crore
(58.7%) had access to banking services. In the first phase of the scheme, these
households were targeted for inclusion through opening of a bank account
within a year of launch of the scheme. The actual achievement, by 26th
January 2015, was 12.55 crore. As on 27.3.2019, the number of accounts has
grown to 35.27 crore. Further, in 2011, only 0.33 lakh SSAs had banking
facility and through provision of Bank Mitras in 1.26 lakh branchless SSAs,
banking services were extended throughout rural India. The inclusive aspect
of this is evident from the fact that 20.90 crore (60%) of PMJDY accounts are
in rural areas and 18.74 crore (over 53%) PMJDY account holders are
women.
Pradhan Mantri Vaya Vandana Yojana
The ‘Pradhan Mantri Vaya Vandana Yojana (PMVVY) has been launched by
the Government to protect elderly persons aged 60 years and above against a
future fall in their interest income due to uncertain market conditions, as also
to provide social security during old age. The scheme is implemented through
the Life Insurance Corporation of India (LIC) and open for subscription up to
31st March, 2023. PMVVY offers an assured rate of return 7.40% per annum
for the financial year 2020-21 for policy duration of 10 years. In subsequent
years, while the scheme is in operation, there will be annual reset of assured
rate of return with effect from April 1st of the financial year in line with
applicable rate of return of Senior Citizens Saving Scheme(SCSS) up to a
ceiling of 7.75% with fresh appraisal of the scheme on breach of this
threshold at any point. Mode of pension payment under the Yojna is on a
monthly, quarterly, half yearly or annual basis depending on the option
exercised by the subscriber. Minimum purchase price under the scheme is Rs.
1,62,162/- for a minimum pension of Rs. 1000/- per month and the maximum

purchase price is Rs. 15 lakh per senior citizen for getting a pension amount
of Rs. 9,250/- per month.
Stand Up India Scheme
Government of India launched the Stand Up India scheme on 5th April, 2016.
The Scheme facilitates bank loans between Rs.10 lakh and Rs.1 crore to at
least one Scheduled Caste/ Scheduled Tribe borrower and at least one Woman
borrower per bank branch for setting up greenfield enterprises. This enterprise
may be in manufacturing, services or the trading sector. The scheme which is
being implemented through all Scheduled Commercial Banks is to benefit at
least 2.5 lakh borrowers. The scheme is operational and the loan is being
extended through Scheduled Commercial Banks across the country. Stand Up
India scheme caters to promoting entrepreneurship amongst women, SC & ST
category i.e those sections of the population facing significant hurdles due to
lack of advice/mentorship as well as inadequate and delayed credit. The
scheme intends to leverage the institutional credit structure to reach out to
these underserved sectors of the population in starting greenfield enterprises.
It caters to both ready and trainee borrowers. To extend collateral free
coverage, Government of India has set up the Credit Guarantee Fund for
Stand Up India (CGFSI). Apart from providing credit facility, Stand Up India
Scheme also envisages extending handholding support to the potential
borrowers. It provides for convergence with Central/State Government
schemes. Applications under the scheme can also be made online on the
dedicated Stand Up India portal(www.standupmitra.in). As on 31.03.2019,
Rs. 16,085 crore has been sanctioned in 72,983 accounts (59,429 – women,
3,103-ST and 10,451 – SC).

Atal Pension Yojana (APY)
APY was launched on 9th May, 2015 by the Prime Minister. APY is open to
all saving bank/post office saving bank account holders in the age group of 18
to 40 years and the contributions differ, based on pension amount chosen.
Subscribers would receive the guaranteed minimum monthly pension of Rs.
1,000 or Rs. 2,000 or Rs. 3,000 or Rs. 4,000 or Rs. 5,000 at the age of 60
years. Under APY, the monthly pension would be available to the subscriber,
and after him to his spouse and after their death, the pension corpus, as
accumulated at age 60 of the subscriber, would be returned to the nominee of
the subscriber. The minimum pension would be guaranteed by the
Government, i.e., if the accumulated corpus based on contributions earns a
lower than estimated return on investment and is inadequate to provide the
minimum guaranteed pension, the Central Government would fund such
inadequacy. Alternatively, if the returns on investment are higher, the
subscribers would get enhanced pensionary benefits. In the event of pre-
mature death of the subscriber, Government has decided to give an option to
the spouse of the subscriber to continue contributing to APY account of the
subscriber, for the remaining vesting period, till the original subscriber would
have attained the age of 60 years. The spouse of the subscriber shall be
entitled to receive the same pension amount as that of the subscriber until the
death of the spouse. After the death of both the subscriber and the spouse, the
nominee of the subscriber shall be entitled to receive the pension wealth, as
accumulated till age 60 of the subscriber. As on 31st March, 2019, a total of
149.53 lakh subscribers have been enrolled under APY with a total pension
wealth of Rs. 6,860.30 crore.

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)
The PMJJBY is available to people in the age group of 18 to 50 years having

a bank account who give their consent to join / enable auto-debit. Aadhar is
the primary KYC for the bank account. The life cover of Rs. 2 lakh is for the
one year period stretching from 1st June to 31st May and is renewable. Risk
coverage under this scheme is for Rs. 2 lakh in case of death of the insured,
due to any reason. The premium is Rs. 330 per annum which is to be auto-
debited in one instalment from the subscriber’s bank account as per the option
given by him on or before 31st May of each annual coverage period under the
scheme. The scheme is being offered by the Life Insurance Corporation and
all other life insurers who are willing to offer the product on similar terms
with necessary approvals and tie up with banks for this purpose. As on 31st
March, 2019, cumulative gross enrolment reported by banks subject to
verification of eligibility, etc. is over 5.91 crore under PMJJBY. A total of
145763 claims were registered under PMJJBY of which 135212 have been
disbursed.
Pradhan Mantri Suraksha Bima Yojana (PMSBY)
The Scheme is available to people in the age group 18 to 70 years with a bank
account who give their consent to join / enable auto-debit on or before 31st
May for the coverage period 1st June to 31st May on an annual renewal basis.
Aadhar would be the primary KYC for the bank account. The risk coverage
under the scheme is Rs. 2 lakh for accidental death and full disability and Rs.
1 lakh for partial disability. The premium of Rs.12 per annum is to be
deducted from the account holder’s bank account through ‘auto-debit’ facility
in one instalment. The scheme is being offered by Public Sector General
Insurance Companies or any other General Insurance Company who are

willing to offer the product on similar terms with necessary approvals and tie
up with banks for this purpose. As on 31st March, 2019, cumulative gross
enrolment reported by Banks subject to verification of eligibility, etc. is over
15.47 crore under PMSBY. A total of 40,749 Claims were registered under
PMSBY of which 32,176 have been disbursed.
Pradhan Mantri Mudra Yojana
The scheme was launched on 8th April 2015. Under the scheme a loan of upto
Rs. 50,000 is given under sub-scheme ‘Shishu’; between Rs. 50,000 to 5.0
Lakhs under sub-scheme „Kishore‟; and between 5.0 Lakhs to 10.0 Lakhs
under subscheme ‘Tarun’. Loans taken do not require collaterals. These
measures are aimed at increasing the confidence of young, educated or skilled
workers who would now be able to aspire to become first generation
entrepreneurs; existing small businesses, too, will be able to expand their
activates. As on 31.03.2019, Rs. 3,21,722 crores sanctioned (Rs. 142,345 cr. -
Shishu, Rs. 104,386 cr. Kishore and Rs. 74,991 cr. - Tarun category), in 5.99
crores accounts.
NABARB
National Bank for Agriculture and Rural Development (NABARD) was

established on July 12, 1982 with the paid up capital of Rs. 100 cr. by 50: 50
contribution of government of India and Reserve bank of India. It is the apex
banking institution to provide finance for Agriculture and rural development.
National Bank for Agriculture and Rural Development (NABARD) was
established on July 12, 1982 with the paid up capital of Rs. 100 cr. by 50: 50
contribution of government of India and Reserve bank of India. It is an apex
institution in rural credit structure for providing credit for promotion of
agriculture, small scale industries, cottage and village industries, handicrafts
etc.

Functions of NABARD:
1. To serve as an apex financing agency for the institutions providing

investment and production credit for promoting various developmental
activities in rural areas;
2. To take measures towards institution building for improving absorptive
capacity of the credit delivery system, including monitoring, formulation of
rehabilitation schemes, restructuring of credit institutions and training of
personnel;
3. To coordinate the rural financing activities of all institutions engaged in
developmental work at the field level and liaison with the Government of
India, the State Governments, the Reserve Bank and other national level
institutions concerned with policy formulation; and
4. To undertake monitoring and evaluation of projects refinanced by
5. NABARD gives high priority to projects formed under Integrated Rural
Development Programme (IRDP).
6. It arranges refinance for IRDP accounts in order to give highest share for
the support for poverty alleviation programs run by Integrated Rural
Development Programme.
7. NABARD also gives guidelines for promotion of group activities under its
programs and provides 100% refinance support for them.
8. It is setting linkages between Self-help Group (SHG) which are organized
by voluntary agencies for poor and needy in rural areas.
9. It refinances to the complete extent for those projects which are operated
under the ‘National Watershed Development Programme and the ‘National
Mission of Wasteland Development’.

10.It also inspects and supervises the cooperative banks and RRBs to
periodically ensure the development of the rural financing and farmers’
welfare.
11.NABARAD also recommends about licensing for RRBs and Cooperative
banks to RBI.
12. ABARD gives assistance for the training and development of the staff of
various other credit institutions which are engaged in credit distributions.
13.It also runs programs for agriculture and rural development in the whole
country.
14.It is engaged in regulations of the cooperative banks and the RRB‟s, and
manages their talent acquisition through IBPS CWE conducted across the
country.
Role of NABARD:
1. It is an apex institution which has power to deal with all matters

concerning policy, planning as well as operations in giving credit for
agriculture and other economic activities in the rural areas.
2. It is a refinancing agency for those institutions that provide investment
and production credit for promoting the several developmental programs
for rural development.
3. It is improving the absorptive capacity of the credit delivery system in
India, including monitoring, formulation of rehabilitation schemes,
restructuring of credit institutions, and training of personnel.
4. It co-ordinates the rural credit financing activities of all sorts of
institutions engaged in developmental work at the field level while
maintaining liaison with Government of India, and State Governments,
and also RBI and other national level institutions that are concerned with
policy formulation.
5. It prepares rural credit plans, annually, for all districts in the country.

6. It also promotes research in rural banking, and the field of agriculture and
rural development.
REGIONAL RURAL BANK(RRB)
The banking sector in India is flourishing with a large and wide account
holder base. Back in the late 20th century, banking was not equally
distributed. It was more accessible to the urban population. To bridge this gap
between the economic development of urban and rural areas of India,
Regional Rural Banks were established. Regional Rural Banks are a type of
commercial banks in India. These have the characteristics of both commercial
banks and cooperative societies.
Importance of Regional Rural Banks
1. Reduce rural and urban gap by mobilising financial resources and services
to rural regions.
2. Regional Rural Banks pave the way for inclusion of the marginal
population like small farmers, Below Poverty Line (BPL) farmers and
workers, small entrepreneurs, artisans, women, etc.
3. Regional Rural Banks assist rural businesses by providing them short term
loans, insurance facilities, etc., and help to improve the role of
entrepreneurship in rural areas.
4. Providing assistance like loans, advances, insurance to agriculturists for
farming inputs, equipment, processing, marketing activities, and
cooperative societies helps in the growth of agriculture and the
advancement of farmers.
5. Many public and private sector banks do not deal with farmers and rural
section due to their small financial needs, fewer incomes, etc. In such a
case, there is a need for a separate banking system to protect the interests of
these sectors.

6. The RRBs look forward to covering underserved rural areas in terms of

financial services and extending credit assistance.
7. Help in the growth of cooperative societies, agricultural societies, etc.
8. RRBs reduce ‘farmers and the weaker sections’ dependence on traditional
sources like moneylenders who exploited them with a high rate of interests
on loans.
Features of the Regional Rural Banks in India
The regional rural banks are the newest form of banks that have been set up in
the country on the sponsorship of individual nationalised commercial banks.
At the end of March 1994, they numbered 196, with about 14,500 branches
covering 408 districts. These banks have been set up with the express
objective of developing the rural economy by providing credit and other
facilities for agriculture and other productive activities of all kinds in rural
areas. The main emphasis is supposed to be on the provision of such facilities
to small and marginal farmers, agricultural labourers, rural artisans, and other
small entrepreneurs working in rural area.

CHAPTER IV
DATA ANALYSIS AND INTERPRETATION

INTRODUCTION
The study is aimed at analysing the various aspects of Banking Habit of Rural
people in Puthucode Panchayath. Study focuses on awareness about the
banking service among rural people, and the problems in availing banking
service among the consumers in rural area.
In this study both statistical and managerial tools are used for analysing data
and these includes charts, graphs, tables, percentage analysis. Using
questionnaire data from 50 people are collected and analysed.
TABLE 4.1 GENDER OF THE RESPONDENTS
VARIABLES NUMBER OF PERCENTAGE

RESPONDENTS
Male 27 54
Female 23 46
Total 50 100
Source : Primary data
CHART 4.1 GENDER OF THE RESPONDENTS
PERCENTAGE
46% Male
54% Female
INTERPRETATION
This table shows that 27 (54%)of the respondents are male and 23(46%) of
the respondents are female.

TABLE 4.2 AGE OF THE RESPONDENTS

RESPONDENTS
Below 25 15 30
25-35 16 32
35-45 9 18
Above 45 10 20
Total 50 100
CHART 4.2 AGE OF THE RESPONDENTS
PERCENTAGE
20%
30%
Below 25
25-35
35-45
18%
Above 45
32%
INTERPRETATION
The age wise classification shows that most(32%) of the respondents are
belong to the category of 25-35 and least(18%) of the respondents are belong
to the category of 35-45.

TABLE 4.3 MARITAL STATUS OF THE RESPONDENTS

RESPONDENTS
Married 25 50
Unmarried 25 50
Total 50 100
CHART 4.3 MARITAL STATUS OF THE RESPONDENTS
PERCENTAGE
Married
50% 50%
Unmarried
INTERPRETATION
This table shows that 25 (50%)of the respondents are married and 25(50%) of
the respondents are unmarried.

TABLE 4.4 EDUCATION QUALIFICATION OF THE

RESPONDENTS
VARIABLES NUMBER OF RESPONDENTS PERCENTAGE

Illiterate 8 16
SSLC 11 22
Plus 2 8 16
graduate 15 30
Post graduate 1 2
Professional 7 14
Total 50 100
CHART 4.4 EDUCATION QUALIFICATION OF THE

RESPONDENTS
PERCENTAGE
Illiterate
2% 14% 16%
SSLC
Plus 2
22% Graduate
30%
Post graduate
16% Professional
INTERPRETATION
Qualification wise classification shows that most(30%) of the respondents are

belong to the category of graduate i.e,15 . and 8 (16%)of the respondents are
belong to the category of plus 2 and also belong to the category of illiterate
and 1(2%) of the respondents are belong to the category of post graduate and
also 7 (14%)of the respondents are belong to the category of professional.

TABLE 4.5 OCCUPATION OF THE RESPONDENTS

RESPONDENTS
Farmer 6 12
Govt. employee 8 16
Private employee 8 16
Business /Self 11 22
employee
Student 11 22
House wife 6 12
Total 50 100
CHART 4.5 OCCUPATION OF THE RESPONDENTS
PERCENTAGE
12% 12%
Farmer
Govt.employee
16% Private employee
22%
Business/Self employee
Student
16% House wife
22%
INTERPRETATION
This table shows that most(22%) of the respondents are business employee
and also students and least(12%) of the respondents are farmer and also house
wife.8(16%) of the respondents are belong to the category of govt. employee
and also private employee.

TABLE 4.6 ANNUAL INCOME OF THE RESPONDENTS

RESPONDENTS
Below 100000 33 66
100001-200000 11 22
200001-300000 3 6
Above 300000 3 6
Total 50 100
CHART 4.6 ANNUAL INCOME OF THE RESPONDENTS
PERCENTAGE
6%
6%
Below 100000
22% 100001-200000
200001-300000
Above 300000
66%
INTERPRETATION
This table shows that most(66%) of the respondents annual income belong to
the category of below 100000 and 11(22%) of the respondents are belong to
the category of 100001-200000.

TABLE 4.7 BANK ACCOUNT

RESPONDENTS
Yes 47 94
No 3 6
Total 50 100
CHART 4.7 BANK ACCOUNT
PERCENTAGE
6%
Yes
No
94%
INTERPRETATION
This table shows that 47(94%) of the respondents have bank account but
3(6%) of the respondents do not have bank account.

TABLE 4.8 NAME OF THE BANK OF RESPONDENTS

RESPONDENTS
South India 26 52
Indian overseas bank 14 28
Co-operative bank 6 12
Esaf small finance 4 8
bank
Total 50 100
Source: Primary data
CHART 4.8 NAME OF THE BANK OF RESPONDENTS
PERCENTAGE
8%
12%
South India
Indian overseas bank
52% Co-operative bank

Esaf small finance bank
28%
INTERPRETATION
From this table, we can understand majority(52%) of the respondents having

their bank account in south India bank i.e,26 and least(8%) of the respondents
having their bank account in Esaf small finance bank.

TABLE 4.9 TYPES OF ACCOUNT OF THE RESPONDENTS

RESPONDENTS
Saving account 36 72
Current account 6 12
Recurring account 3 6
Fixed deposit 5 10
Loan account 0 0
Total 50 100
Source: Primary data
CHART 4.9 TYPES OF ACCOUNT OF THE

RESPONDENTS
PERCENTAGE
0%
10%
6%
Saving account
Current account
12%
Recurring account
Fixed deposit
Loan account
72%
INTERPRETATION
This table shows that most of the respondents maintaining savings account
i.e,72%.Not even a single respondent has a loan account.

TABLE 4.10 NUMBER OF YEARS

RESPONDENTS
Less than 1 year 9 18
1-5 year 13 26
6-10 year 23 46
Above 10 year 5 10
Total 50 100
CHART 4.10 NUMBER OF YEARS
PERCENTAGE
10%
18%
Less than 1 year

1-5 year
6-10 year
26% Above 10 year
46%
INTERPRETATION
This table shows that most of the respondents maintaining their bank account
for 6-10 year i.e,46% and 18% of the respondents maintaining their bank
account for less than one year.

TABLE 4.11 KNOWLEDGE ABOUT THE AGENT OF

DEBIT/CREDIT CARD

RESPONDENTS
Yes 19 38
No 31 62
Total 50 100
CHART 4.11 KNOWLEDGE ABOUT THE AGENT OF

DEBIT/CREDIT CARD
PERCENTAGE
38%
Yes
No
62%
INTERPRETATION
This table shows that majority of the respondents do not have the knowledge
about the agent of the debit or credit card i.e, 62% and 38% of the
respondents having the knowledge about the agent of the debit or credit card.

TABLE 4.12 SOURCE OF INFORMATION

RESPONDENTS
Friends 12 24
Relatives 13 26
Colleagues 6 12
Neighbour 6 12
Bankers 13 26
Total 50 100
CHART 4.12 SOURCE OF INFORMATION
PERCENTAGE
26% 24%
Friends
Relatives
Colleagues
Neighbour
12%
Bankers
26%
12%
INTERPRETATION
Most of the respondents known banking service from relatives and bankers
i.e,26 %.12 % respondents knew banking service from friends. And other 12
(24%)respondents known banking services from colleagues and neighbour.

TABLE 4.13 REASON FOR CHOOSING THIS BANK

RESPONDENTS
Family tradition 14 28
Incentive scheme 6 12
Nearness of 12 24
office/Resident
Jest by chance 5 10
Others 13 26
Total 50 100
CHART 4.13 REASON FOR CHOOSING THIS BANK
PERCENTAGE
Family tradition
26% 28%
Incentive scheme
Nearness of office
10% Jest by chance
12%
Others
24%
INTERPRETATION
This table shows that most of the respondents are choose family tradition as
choosing the bank 14(28 %).Nearness of Office/Residence is the second
reason choose by the respondent 12(24%).13(26%) respondents choose the
option others as reason for choosing bank it include recommended by friends
,staff interaction and good atmosphere. Incentive scheme is the 4th reason
choose by the respondents 6(12%).Just by chance is the 5th reason choose by
the respondents 5(10%).

TABLE 4.14 PROBLEMS IN BANKING SERVICES

RESPONDENTS
Yes 15 30
No 35 70
Total 50 100
CHART 4.14 PROBLEMS IN BANKING SERVICES
PERCENTAGE
30%
Yes
No
70%
INTERPRETATION
This table shows that majority(70%) of the respondents do not face the
problem in banking services but 15 (30%)of the respondents facing a problem
in banking services.

TABLE 4.15 CHANGE IN BANK BRANCH

RESPONDENTS
Yes 12 24
No 38 76
Total 50 100
CHART 4.15 CHANGE IN BANK BRANCH
PERCENTAGE
24%
Yes
No
76%
INTERPRETATION
This table shows that 38(76%) of the respondents do not change their bank
branch during the last 3 years but 12(24%) of the respondents change their
bank branch during the last 3 years.

TABLE 4.16 REASONS FOR POOR PRACTICE OF

BANKING SERVICES
REASONS NUMBER OF PERSENTAGE

RESPONDENTS
Poor availing of 7 14
services
Poor advertisement on 15 30
the service available
Limited time and 11 22
services
Poor network facility 10 20
Others 7 14
Total 50 100
CHART 4.16 REASONS FOR POOR PRACTICE OF

BANKING SERVICES
PERCENTAGE
Poor availing of services
14% 14%
Poor advertisement on the service
available
20% Limited time and services

30%
Poor network facility
22%
Others
INTERPRETATION
This table shows that majority(30%) of the respondents choose the reason of
poor advertisement on the service available for poor practice of banking
services and 22% of the respondents choose the limited time and services .

TABLE 4.17 USAGE FREQUENCY OF THE

RESPONDENTS
Services Every Once in a Once in a Once in 3 Never

day week month month
ATM cum debit card 16 10 10 4 10
Credit card 4 9 9 7 21
Internet banking 14 13 7 2 14
Mobile / Telephone 10 10 10 8 12
banking
CHART 4.17 USAGE FREQUENCY OF THE

RESPONDENTS
PERCENTAGE
25
20
Every day
15
Once in a week
10 Once in a month
Once in 3 month
5
Never
0
ATM cum debit card Credit card Internet banking Mobile / Telephone
banking
INTERPRETATION
This table shows that usage frequency. The majority of the respondents (16)
use ATM cum debit card every day. The majority of the respondent (14) use
internet banking every day and the other 14 of the respondents do not use the
internet banking. The majority of the respondents (12) do not use the
mobile/telephone banking.

TABLE 4.18 LEVEL OF AWARNESS OF THE

RESPONDENTS
STATEMENTS VERY FAIRLY KNOWN SOME UNKNOWN

WELL KNOWN WHAT
KNOWN
Deposit 21 6 13 1 9
collection
Gathering loan 8 15 9 10 8
Fund transfer 12 13 13 3 9
ATM services 15 10 12 2 11
Mutual fund 3 8 14 13 12
CHART 4.18 LEVEL OF AWARNESS OF THE

RESPONDENTS
PERCENTAGE
25
20
Very well known
15
Fairly known
10 Known
5 Some what
Unknown
0
Deposit Gathering loan Fund transfer ATM services Mutual fund
collection
INTERPRETATION
The above table reveals that the level of awareness. 21 of the respondents are
very well known about deposit collection. 8 of the respondents are very well
known about granting loans.12 of respondents are very well known about
funds transfer. 15 of respondents very well known about ATM service. 3 of
respondents very well known about mutual fund services.
TABLE 4.19 LEVEL OF SATISFACTION OF THE

RESPONDENTS
VARIABLES HIGHLY SATISFIED NEUTRA DISSATIS HIGHLY

SATISFIED L FIED DISATISF
IED
Collection 20 14 13 0 3
deposit
Gathering loan 8 13 24 2 3
Agency 4 18 23 0 5
function
Customer 5 16 23 1 5
utility services
Fund transfer 9 17 16 3 5
Online 15 14 12 4 5
banking
CHART 4.19 LEVEL OF SATISFACTION OF THE

RESPONDENTS
PERCENTAGE
30
25
20
Highly satisfied
15 Satisfied
Neutral
10
Dissatisfied
5
Highly dissatisfied
0
Collection Gathering Agency Customer Fund transfer Online
deposit loan function utility banking
services

INTERPRETATION
The table exhibits the satisfaction level of respondents regarding facilities of

bank. It is observed that majority of respondents (20) are highly satisfied on
collecting deposits. 13 of respondents are satisfied with granting loans. 18 of
respondents are satisfied with agency function. 16 of respondents are satisfied
with customer utility service. 17 of respondent are satisfied with fund transfer.
15 of respondents are highly satisfied with online banking.

TABLE 4.20 PROBLEMS IN AVAILING BANKING

SERVICES
PROBLEMS STRONGLY AGREE NEITHER DISAGREE STRONGLY

AGREE AGREE DISAGREE
NOR
DISAGREE
Lack of 25 15 6 4 0
awareness
Lack of co- 13 21 7 8 1
operation
from bankers
No proper 12 18 16 4 0
guidance
No trained 5 13 21 10 1
staff
No proper 11 13 15 8 3
networking
Poor time 5 14 22 6 3
management
CHART 4.20 PROBLEMS IN AVAILING BANKING

SERVICES
PERCENTAGE
30
25
20
15 Srongly agree
10
Agree
5
Neither agree nor disagree
0
Disagree
Srongly disagree

INTERPRETATION
The above table exhibits the problems faced by customers in availing

services. 25 respondents are strongly agreed that they face lack of awareness.
13 respondents strongly agreeing and that lack of cooperation from banker is
a problem faced by this. 12 respondents strongly agreed that no proper
guidance is a problem faced by them. 5 respondents strongly agree that no
trained staffs is a problem facing by them in availing of banking services.11
respondents strongly agreed that no proper networking is a problem facing by
them.

CHAPTER V
FINDINGS, SUGGESTIONS AND CONCLUSION

FINDINGS, SUGGESTIONS AND CONCLUSION
The present study “Banking Habit of Rural people with special reference to
Puthucode Grama Panchayath” focus on the objective factors affecting the
banking habit of rural people, awareness level towards various banking
services and the problems faced by them in availing of banking service. The
present chapter deals with the major findings conducted with in the 50 general
public.
5.1 FINDINGS
FINDINGS IN PERCENTAGE ANALYSIS
● From the analysis it is found that 54 % of the respondents are male.

● Most(32%) of the respondents are belong to the age group of 25-35.
● Most(30%) of the respondents are graduate.
● Most(22%) of the respondents are business employee and also students.
● Majority(66%) of the respondent having annual income below 1 lakh.
● Majority(52%) of the respondent have account in South India.
● Most of the respondents maintaining savings account i.e,72%.
● Most of the respondents maintaining their bank account for 6-10 year
i.e,46%.
● Most of the respondents known banking service from relatives and bankers
i.e,26 %.
● Majority(28%) of the respondents have choose bank because of family
tradition.
● Majority(70%) of the respondents do not face the problem in banking
services but 15(30%) of the respondents facing a problem in banking
services and they(76%) do not change their bank branch during the last 3
years.

● The main reason for poor practice of banking services is poor

advertisement on the service available.
● The majority of the respondents (16) use ATM cum debit card every day
but the majority(62%) of the respondents do not known the agent of the
debit/credit card.
● Some respondents do not use the internet banking(14%) and
mobile/telephone banking(12%) .
● Majority(21%) of the respondents are very well known about deposit
collection and they(20%) are highly satisfied on collecting deposits.
● Some respondents do not have the knowledge about mutual fund(12%) and
other services(37%).
● Even today , some people(10%) are not satisfied in a services provided by
the bank.
● Majority(40%) of the people facing problem in banking services due to
lack of awareness.

5.2 SUGGESTIONS
The preceding analysis has brought some findings that have implication to
this study. Based on the finding the following suggestions are made to address
the problem of rural households.
1. Unorganized rural banking methods should be strengthened through

government intervention so as to guide their activities.
2. Microfinance bank should extend their operational unit to rural areas so as
to bridge the gap between them.
3. Adequate rural infrastructure should be put in place in rural areas so as to
encourage them.
4. Government should take initiative to open new commercial bank branches
in unbanked rural areas.
5. Bank should take appropriate measure to handle customer grievances and
complaints in an effective manner.
6. Bank should initiate special promotion campaigns in unbanked rural areas
to enhance financial literacy and awareness among rural population.

5.3 CONCLUSION
The present study “Banking Habit of Rural People with special reference to
Puthucode Grama Panchayath” focus on the objective such as to examine the
level of awareness of rural people in various banking services, to study the
problems in availing banking service among the consumers in rural area, to
analyse banking habit of consumers in rural are and to analyse most
frequently used banking service. The major findings of the study reveals that
the respondents are highly aware of deposit collection. The majority of the
respondents reveals that lack of awareness is the main problem in availing
banking services. The majority of the respondents reveals that ATM cum
debit card is the most frequently used banking service.

BIBLIOGRAPHY

BOOKS
● Manas Chakrabarti – Rural banking in India

● Divesh Mishra – A simple guide to banking
● Bhaktapada Sinha Roy – Rural banking and poverty alleviation
ARTICLES
● Dr.B Maheswari – Customer perception towards banking habits in rural

areas - volume no.1, issue-3 , 2021
● Mr.Sanjay Karmakar and Dr.Nilanjana Deb – An empirical study on
banking habits of the people of the rural area – 2021
● Riddhi Sanghvi, Jay Talati and H N Misra – Determinants of banking habit
of people in rural and urban areas – volume no. 3, issue-9 , 2017
WEBSITES
● http://www.shodganga.com
● http://www.googlescholar.com
● http://www.researchgate.com
● http://www.slideshare.net

APPENDIX

“A STUDY ON THE BANKING HABIT AMONG RURAL PEOPLE

WITH SPECIAL REFERENCE TO PUTHUCODE GRAMA
PANCHAYATH”
QUESTIONNAIRE
1. Name of the Account holder:

2. Gender:
a. Male
b. Female
3. Age:
a. Below 25
b. 25 – 35
c. 35 – 45
d. Above 45
4. Marital status:
a. Married
b. Unmarried
5. Education qualification:
a. Illiterate
b. SSLC
c. Plus two
d. Graduate
e. Post graduate
f. Professional

6. Occupation:
a. Farmer
b. Govt. employee
c. Private employee
d. Business / Self employee
e. Student
f. House wife
7. Total annual income:
a. Below 100000
b. 100001 – 200000
c. 200001 – 300000
d. Above 300000
8. Do you have a bank account?
a. Yes
b. No
9. What is your bank name?
a. South India
b. Indian overseas bank
c. Co-operative bank
d. Esaf small finance bank
10.Types of account do you have?
a. Current account
b. Recurring deposit
c. Fixed deposit
d. Loan account
e. Saving account

11.What are the most frequently used banking services?

a. Online banking
b. Mobile banking
c. Credit card
d. ATM
12.How long are you maintaining your account?
a. Less than 1 year
b. 1 - 5 year
c. 6 - 10 year
d. Above 10 year
13. Do you know the agent of your debit / credit card?
a. Yes
b. No
14.Where did you come to know about banking services?
a. Friends
b. Relatives
c. Colleagues
d. Neighbour
e. Bankers
15.Indicate the reason for choosing this bank as your bank:
a. Family tradition
b. Incentive schemes
c. Nearness of office
d. Jest by chance
e. Others
16.Do you have any problem in banking services?
a. Yes
b. No
17.Did you change your bank branch during the last 3 years?
a. Yes
b. No
18.Choose the reason for poor practice of banking services:

a. Poor availing of services
b. Poor advertisement on the service available
c. Limited time and services
d. Poor network facility
e. Others
19.Please show your usage frequency:
Services Every day Once in a Once in a Once in a Never

week month 3 month
ATM cum
debit card
Credit
card
Internet
banking
Mobile /
Telephone
banking

20.State your level of awareness:
Statements Very well Fairly Known Some Unknown

known known what
Deposit collection
Gathering loans
Fund transfer
ATM services
Mutual fund
21.Indicate the level of satisfaction on the various services offered in your

areas:
Satisfaction Highly Satisfied Neutral Dissatisfied Highly
satisfied dissatisfied
Collection
deposit
Gathering loans
Agency
function
Customer utility
services
Fund transfer
Online banking

22.State your level of acceptance for the following general problems facing
by you in availing banking services. Please tick anyone option on the
given scale between 1 to 5 scale :
Problems Strongly Agree Neither Disagree Strongly
agree agree nor disagree
disagree
Lack of
awareness
Lack of co-
operation from
bankers
No proper
guidance
No trained staff
No proper
networking
Poor time
management

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Project Report 2022-2023

College of Applied Science, Vadakkencherry 1

Banking habits can be analysed on the basis of frequency of bank visit,

College of Applied Science, Vadakkencherry 2

1.2 STATEMENT OF THE PROBLEM

College of Applied Science, Vadakkencherry 3

1.3 OBJECTIVES OF THE STUDY

1.4 SCOPE OF THE STUDY

1.5 RESEARCH METHODOLOGY

1.5.1 RESEARCH DESIGN

The study is descriptive & analytical in nature. It intends to explore the

College of Applied Science, Vadakkencherry 4

1.5.2 SOURCE OF DATA

The study is based on both primary and secondary data.

Primary data - primary data is collected through a well structured

Secondary data - secondary data is collected from various websites,

1.5.3 SAMPLING TECHNIQUE

Since it is difficult to study the entire population sampling technique is

1.5.4 SAMPLE SIZE

The sample size of 50 people are taken for the study.

1.5.5 TOOLS FOR ANALYSIS

Simple percentage analysis

Simple percentage analysis refers to a special kind of rates, percentage are

1.5.6 PERIOD OF STUDY

The present study covers of 21 days.

1.6 LIMITATIONS OF THE STUDY

• The present study was conducted in Puthucode Panchayath in Palakkad

College of Applied Science, Vadakkencherry 5

• The respondents are also from different categories influenced by the

1.7 SCHEME OF PRESENTATION

The study is presented in 5 chapters as follows:

Chapter 2- Review of literature

Chapter 3- Theoretical review

Chapter 4- Data Analysis and Interpretation

Chapter 5- Findings, suggestions and conclusion

College of Applied Science, Vadakkencherry 6

College of Applied Science, Vadakkencherry 7

Review of literature is an indispensable part for any research work. A

1. Dr. B. Maheshwari (2021) focused in the study entitled as “Customer

KOTAK and INDUSIND bank. Study found reliability and responsiveness

College of Applied Science, Vadakkencherry 9

College of Applied Science, Vadakkencherry 10

7. Divya Joseph (2019), studied the intensity of financial inclusion and

College of Applied Science, Vadakkencherry 11

College of Applied Science, Vadakkencherry 12

College of Applied Science, Vadakkencherry 13

available at Trichirappalli district of Tamil Nadu. The article showed that

College of Applied Science, Vadakkencherry 14

College of Applied Science, Vadakkencherry 15

Banking is defined as the business activity of accepting and safeguarding

2. Withdrawal of deposit, whenever needed

College of Applied Science, Vadakkencherry 16

Important Functions of Bank

There are two types of functions of banks:

1. Primary functions – being primary are also called banking functions.

Both the types of functions of bank are explained below in detail:

2. Granting of loans and advances

1. Saving Deposits: encourages saving habits among the public. It is suitable

2. Fixed Deposits: Also known as Term Deposits. Money is deposited for a

3. Current Deposits: They are opened by businessmen. The account holders

4. Recurring Deposits: A certain sum of money is deposited in the bank at a

Granting of Loans & Advances

Bank offers the following types of Loans and Advances:

1. Bank Overdraft: This facility is for current account holders. It allows