Co Operative Society

ONE FOR ALL, ALL FOR ONE
SYNOPSIS
INTRODUCTION TO THE PROJECT REPORT
CO-OPERATIVE MOVEMENT IN INDIA
CO-OPERATIVE ORGANISATION
SIR M. VISHWESHVARIAH CO-OPERATIVE SOCIETY
LTD., SHIVAMOGGA A PROFILE
CREDIT FACILITIES IN SIR M. VISHWESHVARAIAH
CO-OPERATIVE SOCIETY LTD., SHIVAMOGGA
RECOVERY OF LOANS IN SIR M. VISHWESHVARAIAH
CO-OPERATIVE SOCIETY LTD., SHIVAMOGGA
ANALYSIS OF RESONSE
SUGGESTIONS AND CONCLUSIONS
ANNEXURES
SAHYADRI ARTS & COMMERCE COLLEGE
Chapter-I
INTRODUCTION
INTRODUCTION TO PROJECT REPORT
AIMS AND OBJECTIVES
METHODOLOGY
IMPORTANCE AND LIMITATION OF THE
STUDY
PREAMBLE
In the beginning of human existence, needs were simple and every
individual produced all that was necessary to sustain life, he provided his
own food of animal flesh and vegetables; prepared his own clothing and
found his own shelter.
After this stage, Barter system came into existence. Barter System
means trade with exchange of goods, with the absence of money. At this
stage the concept of dependency demanded co- operation that is how cooperation was born.
In course of time, people settled down in different occupations,
and with specialization, exchange of goods became wider. And the
money was introduced in trading, which was widely accepted for
payment. As money started getting importance Co-operation was going
hand in hand with it.
So, co-operation is an important thing which plays an important
role in all for goods and services and in settlement of debts. Money is
given and received without reference to the standing of the person who
offers it in payment.
According to D.H. Robertson money is any thing which is
widely accepted in payment for goods or in discharge of other kinds of
business obligations.
This is the way how money got extends into the co-operation.
OBJECTIVES
Following are the some of the major objectives of the project
report.
To know about the co-operative societies.
To study the establishment of the sir. M. vishweshvaraiah cooperative society Ltd.
To know the performance of sir .M. Vishweshvaraiah co-operative
society Ltd.
To make a detail study of credit facilities and recovery of debts of
sir .M. Vishweshvaraiah co-operative society Ltd.
To express out own opinion about the societys development and

services.
AREA OF STUDY
Sir .M. Vishweshvaraiah co-operative society Ltd, Shivamogga
which is located in Shivappa Naika Complex, Nehru Toad is selected for
the study. This study involve in the detailed report of the Sir .M.
Vishweshvaraiah co-operative society Ltd. About its Credit facilities and
recoveries of debts since the year of its establishment.
This society was established in the year 1983, since, from its
establishment, it is working or providing services for the up liftman of its
members.
METHODOLOGY:
Primary and secondary data re collected for the preparation
of the project report.
Primary data has been collected through survey. Survey was
conducted, questionnaire was prepared and the respondents were
selected on random sampling bases to avoid bias in collection and
analysis of data, which reveals.
Secondary data has been collected from the secretary and staff of
the society personally interviewed and from the bye-law, annual report
and other documents of the society to study the various aspects of cooperation service and finance.
IMPORTANCE OF THE STUDY
Following are the some major importance of the study;
1. It provides information about the co-operative principles, its
origin and importance in Indian society.
2. It helps to know the structure, organization and performance of
the SMV Cooperative Society Ltd.
3. The report helps to know the procedure principle and policies and
functions, of the society.
4. We can get clear picture about the credit facilities and recoveries
of debts of the SMV Co-operative Society Ltd.
LIMITATIONS OF THE STUDY

There are certain limitations are found in doing the project report.
They are:
1. Members were selected on random basis. Hence they may hot
represent the population.
2. Some members were hesitant to give out their opinion about the
society services. Hence, the information my be biased.
3. The survey entitled the limitation of time factor. Due to this
limitation of the project lacks in detailed information.
4. As the recent information regarding 5 years plans were not
available its not been included in the project.
Chapter-II
CO-OPERATIVE MOVEMENT
INTRODUCTION
MEANING
DEFINITION
STAGES IN CO-OPERATIVE MOVEMENT IN INDIA
BENEFITS OF CO-OPERATIVE MOVEMENT IN
INDIA
CO-OPERATIVE IN FIVE YEAR PLANS
INTRODUCTION
Co-operative means working together. The principle of cooperation is as old as human society. It is truly the basis of domestic and
social life. What is known as co-operative effort is ultimately the group
instinct in man, which enables him to work together and help each other
in times of stress and strain. Unconsciously the principle has always
penetrated the life of human race. The history of co-operation, for
without it social and economic progress would have been impossible.
MEANING AND DEFINITION
Modern biologists believe that the co-operative forces are
biologist more important and vital.
According to Emerson co-operation has a more evolutionary in
the development of man than has the better competitive struggle for
existence.
According to Montague science points out the way to survival
and happiness for all mankind through love and co-operation.

India is a country with a rural setting having 5, 75,936 inhabited
villages studded with towns and villages. Which serve a center of trade,
commerce, industries, education and administration? 70% of working
force still depends upon agriculture.
Towards the end of the last century, the peasantry or agriculturist
was in the grip of Sahukar and the rural debt was daily mounting the
condition of the agriculturists was readily deplorable. As a result of
increase in population and the absence of rapid industrialization, more
and more people depended upon agriculture resulting in too much on
land farmers. Who were once prosperous become petty peasants with
tiny holdings of a few acres and were finally reduced to the status of
land less laborers. They are in the clutches of the moneylenders. Rural
debt was decreasing and this increased the burden on the farmer. The
farmer did not have the incentive or the ability to improve the condition.
The government fell that the farmer could help through some type of a
co-operative effort.
The credit of taking right action in this matter goes to the
government of Madras (Chennai). In 1882 they deputed Sri Frederick
Nicholson to probe into the possibility of introducing land and
agriculture banks in that provinces. In the basis of recommendations, it
was passed into law in 1904, as the co-operative Credit Society Act.
Following are the stages of Co-operative Movement in India;

Ist STAGE OF THE MOVEMENT (1904 11)
The introduction of the Co-operative Credit Society Act in 1904
marked in the beginning of the co-operative movement in India.
The essential features of this act were s follows:
1. A society could be formed by any ten persons living in the same
village or town.
2. The co-operative societies were classified as rural and urban.
3. The Act provided only for the formation of credit societies.
4. The societies could advance loans to members only on personal or
real security.
5. No member could hold shares for more than Rs. 1,000.
IInd STAGE (1912 18)
The defects of the 1904 Act were remained in 1912 when another
Co-operative Societies Act was enacted. With the passing of this Act, the
movement entered on the second stage of this progress.
The essential features of this Act are the following:
1. Under this Act, any society, credit or otherwise may be registered
which has its object that the promotion of the economic interests of
its members in accordance with the co-operative principles.
2. A federal society like the Central Bank could be registered.
3. No member can more than 1/5th of the total share capital.
4. 1/4th of the net profit of a society must be carried to its reserve fund.
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III rd STAGE 91919 29)

During this period, the movement continued to make a rapid
progress. The number of membership of agricultural credit societies
increased three times, while their working capital moved up four folds.
In spite of this rapid expansion the proportion of the rural families
brought with in the co-operative fold was very small.
IV th AND V th STAGE (1929 -39)
A significant highlight of this period was, the establishment of the
Reserve Bank of India in 1935, and its Agricultural Credit
Department which was charged with the duty of studying various
problems relating to agricultural credit.
CO-OPERATIVE MOVEMENT AFTER INDEPENDENCE
After independence the co-operative movement has been making
rapid progress in various directions. The government has established
various committees like The Co-operative Planning Committee (1946),
The All India Rural Credit Committee ( 1954), The Vaikunth Lal Mehta
Committee (1960) etc. Further the co-operating has been assigned as
important role in the country plans.
Rural Credit Survey Committee:The most important landmark in the history of the co-operative
movement in India after independence was the publication of the report
of All India Rural Credit Survey Committee. The report contains the
survey conducted by the committee in villages.
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THE Ist FIVE YEAR PLAN (1951 - 56)

The 1st five year plan, which was launched in 1950 -51, described the
co- operative movement as an indispensable instrument of planned
action in the country.
The main features of the 1st plan with reference to co-operative are
the following:
1. Co-operative agencies in the village should have the closest possible
relationship with panchayat.
2. The target set by the Co-operative Planning Committee is to cover
50% of Indias villages.
3. An attempt should be made to have a co-operative organization in
each village, which will cater to the multiple needs of its members.
4. The state should encourage the information of co-operative firms.
The committee recommended on Integrated Schemes Rural Credit
based on the following principles.
i. State Partnership.
ii. Long term Operations Fund.
iii. Loans against Anticipated Crops.
iv. Large sized Societies.
v. Special Funds.
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THE IInd FIVE YEAR PLAN (1955-56)

During the IInd plan period in 1958 the National Development
Council considered the role of co-operative movement in intensifying
agricultural production and building the rural economy. Economy
development at the village level should be placed fully on the village cooperatives and the village panchayat. The main recommendations of the
NDC was to ensure every family is represented in the village cooperatives and the co-operatives should make permanent arrangements
in the village for producing the seeds and organic and green manures,
needed, arrange for the supply of these in kind to persons who cannot
pay for them in advance, recoveries being made after harvest. During
this period a lot of attention was given to rural development and success
is also achieved.
Consumers Co-operative Movement made phenomenal progress
during the IIIrd plan on account of government patronage and assistance
under the centrally sponsored schemes.
THE IIIrd FIVE YEAR PLAN (1961 66)
During the IIIrd plan, the co-operative movement was accorded a
special role in implementing the schemes of economic development with
special reference to rural areas. The agricultural credit movement should
cover all the villages and 60% of the agricultural population by the end
of the IIIrd plan.
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Progress during the III rd plan

As against 100% coverage aimed at in the IIIrd plan 80% of village
were covered. Paddy being one of the important crops, which needs
processing before it reaches the consumer. Co-operative was assisted to
setup Rice Mills in the IIIrd plan.
At the end of the IIIrd plan there were 78 co-operative sugar
factories, 155 cotton ginning pressing societies, 329 paddy husking
societies and mills, 298 oil-crushing societies and 22 fruit and vegetable
societies were present.
ANNUAL PLANS (1966 69)
After the IIIrd five year plan, co-operative movement made
headway under the annual plans. In 1966-67, Rs. 33.5 Crores; in 196768, Rs 36.3 Crores and in 1968 -69, Rs34 Crores were spend in this
field.
IVth FIVE YEAR PLAN (1969 74)
In the IVth plan, one of the main endeavors was to orient the
policies and procedures of credit co-operative and land development
banks in favor of small cultivators.
All India Rural Credit Review Committee:All India Rural Credit Review Committee was appointed by the
Governor of the Reserve Bank for reviewing the supply of the credit in
the context of the IVth plan in general and the intensive agricultural
programmed in particular. The recommendation made by this committee
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are; the re-organization of rural credit in RBI; involving the

establishment of an
Agricultural Credit Board; the setting up of a small farmers development

agency in each of a number of selected throughout the country.
The important recommendations made by the committee are listed
below;
1. Need for viable primary co-operatives.
2. Lending policies and procedures. Small farmers development
agency.
3. Term credit.
4. Rural Electrification Corporation.
5. Role of the RBI.
Progress during the IVth plan
The performance of the co-operative movement during the IVth
plan period presents a mixed picture. in respect of one item namely, cooperative marketing as agricultural produce, the IVth plan targets were
exceed.
Another significant development in the course of the IVthe plan
has been the establishment of a consultancy and promotional all with in
the national co-operative consumer federation for providing expert
guidance to consumer co-operatives.
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Vth FIVE YEAR PLAN (1974 79)

Three specific objectives have been stated for co-operative
development during the V th plan.
1. To strengthen the network of agricultural co-operatives.
2. To build up a viable consumer co-operative movement to enable it to
function as an important element in a consumer oriented distribution
system.
3. to make efforts towards the correction of regional imbalances in the
level of the co-operative development particularly in the sphere of
agricultural credit.
VIth FIVE YEAR PLAN (1980 85) &
VIIth FIVE YEAR PLANK (1985 90)
At the end of the VIth plan the short term loans and the medium
term loans, advanced amounted to Rs. 2,500 Crores and Rs.250 Crores
respectively. A major development in the field of credit during the VI th
Plan was the setting up of National Bank for Agriculture and Rural
Development in July 1982. NABARD has emerged as an apex
national institution accredited with all materials concerning policy
planning and operations in the field of credit for agriculture and other
economic activities in the rural areas.
The major twist during the VIIth Plan to ensure adequate flow of
credit to the weaker sections of the population and to the rural areas.
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CO-OPERATION PROSTECTS
The co-operative movement has been in existence in the country
for more the 90 years. The movement was introduced with high hopes
and lofty expectations. It was expected to provide lasting solution to the
problems of our rural economy.
The co-operative movement is now a mammoth organization
covering about 95% of villages and 44% of our rural population. In a
single village, which is not covered by a village co-operative society.
ACHIEVEMENTS
The various achievements of the co-operative movement in
India can be summarized under the following heads.
1)
Economic Benefits
The co-operative movement has been rendering invaluable
services for the economic betterment and well being of the rural
population. Some of the economic benefits provided by the co-operative
movement can be stated as under:
Cheap credit
Rescuing the peasantry from the clutches of money lender
Better use of credit
Popularizing modern inputs
Better prices to farmers
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Rural entrepreneur
Developing banking habits
2)
Social and Moral Benefits

The co-operative movement has also brought about a number of
special and moral benefits to the people they are:

it is reaching people to live harmoniously on a community
basis.
It fosters a sense of responsibility integrity and diligence.
3)
Educational Benefits
A good co-operative society is a continuous source of education
for the member of rural areas. It reaches the proper use of money, the
true value of goods and better methods or production.
Thus, the co-operative movement is playing a significant role in
the present economic setup, in acknowledged on all hands. It cannot
eliminate.
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Chapter-III
CO-OPERATIVE ORGANISATION
FEATURES
TYPES OF CO-OPERATIVE SOCIETY
ROLE OF CO-OPERATIVE SOCIETY IN
SOCIAL CHANGES IN INDIA
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Co-operative form of organization is different from other
organizations i.e., sole- trading concerns, partnership firms and joint
stock companies in one basic aspect that the Co-operative organization is
not set-up for rendering services to the voluntary bases for the
furtherance of her common economic interest (goal).The co-operative
organization may be defined as a voluntary association of persons
joining together in equal basis for the promotion of certain economic or
business interest of the society.
The International Labor Organization defined the co-operative
organization as an association of persons, usually of limited, means
who have voluntarily joined together to achieve a common economic
and through the formation of a democratically controlled business
organization making equitable contributions to the capital required and
accepting a fair share of risks and benefits of the undertakings.
Prof. Paul Lambert, a leading authority on co-operations states:
A co-operative society is an enterprise formed and directed by an
association of users, applying within it the sales of democracy and
directly intended to serve both its own members and the community as
whole.
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Features of Co-Operative Organization

1. voluntary association:
A co-operative society is a voluntary association of persons and
not of capital any persons irrespective of sex, creed casts etc. any person
can join the society of his wish and he can leave it at any time after
giving the notice
to society. While leaving he has to withdraw his amount and he is not
suppose to transfer the amount on other persons.
2. Source of finance:
The capital of co-operative society is raised from the members by
way of share capital. Since co-operatives are organized by relatively
weaker section of society, the share capital will be limited. However, it
is a part of government policy to assist and encourage co-operative
societies and therefore, a co-operative society can usually arrange its
resources by loans from the State and Central Co-operative Banks.
3. Control and management:
Democracy is the keynote of the management of the co-operative
society since most of these societies operate on a local scale, the
meetings of the members select the managing committee and lay down
the policy which it must flow to promote their common interest each
member, whatever may be the state in the society, has one vote and by
proxy. Besides the organization and control of a co-operative society,
has one vote and by proxy. Besides the organization and control of a coSAHYADRI ARTS & COMMERCE COLLEGE
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operative society may be carried on by two or more members working in

different capacities and outsides may be employed only when the society
grows too large.
4. Service Notice:
A co-operative society is organized primarily with the object of
rendering maximum service to its members in certain field. It does not
aim at the cast of its members for it is formed basically for providing
certain essential facilities to members. This does not mean that a cooperative society will have work for profit. It is quite used for societies
to earn profits by extending their services to maximum members.
5. Disposal of surplus:
It is usual for commercial concerns to distribute profits among the
owner in the ration of their capital contribution or in agreed ration. A cooperative society differs from trading company in their respect. Under
the co-operative form of ownership and organization. The surplus arising
of a years working is given to the members not directly or divided on
shares held by each of them. But in the form of a bonus which need not
be proportionate to their respective capital contribution.
6. Fixed return on capitals:
The fixed or limited return on capital subscribed to the society
must be paid out of the surplus to the members making the payment of
fixed interest or paid up capital definitely a first charge on the trading
surplus of all those who joined the society a solid reason for leaving their
saving in deposits with it.
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7. State control and co-operative status:

Although voluntary in their basic chapter the co-operative
societies are subject to considerable state control and supervision.
Although, the co-operative societies are voluntary in their basic
feature but, they are subject to some considerable state control and
supervision.
The features of the co-operative organization outlined above were

the basic principles on which the co-operative movement was based in
the beginning. With the passage of time, some of them have been
modified in view of the peculiar needs and difficulties of certain types of
societies.
While a co-operative society is essentially a business unit
established primarily for organizing and providing some services to the
members and the committee. It is a movement aiming at the end of
exploitation by private business and the development of self help among
various sections of the society in voluntary basis. It is a socio-economic
movement inspired by the idea of organizing and uplifting the weaker
section of the society through collective action.
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TYPES OF CO-OOPERATIVE SOCIETY

Co-operatives may be formed practically in any work of life.
Some of them concern themselves with the moral and social uplift of a
weaker section of the society. And, some of them combine some
business activity with service to their members. Since co-operative are
being consider here as a force of business organization, only those
societies which are concern with some business purpose need an
introduction here. The principal types of business co-operatives are as
enumerated below:
1) Consumers Co-operative Societies
2) Producers Co-operative Societies
3) Marketing Co-operative Societies
4) Housing Co-operative Societies
5) Co-operative Credit Societies
6) Co-operative Forming Societies
1. consumers Co-operative Societies:
These societies are formed by the ordinary or general people for
obtaining their day-to day requirements of goods at cheaper prices.
These societies make their purchase in bulk from wholesalers at
wholesale rates and sell to members at market prices. The difference is
represented by the surplus. Which is distributed among the purchasing
members in the form of bonus on purchases?
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This is the oldest form of co-operative organization. In India,

consumers co-operative societies have received impetus (impulses)
from the government attempt to check rise in prices of consumers goods
and essential commodities.
2. Producers Co-operative Societies:
It is also called as industrial co-operatives these societies are
voluntary association of small producers formed with the object of
eliminating the capitalist from the system of industrial production. Some
times consumers societies may join hands with this association.
3. marketing Co-operative Societies:

The marketing co-operative society or the sales co-operative
societies are voluntary association of independent producers organized
for the purpose of arranging for the sale of their output. As the central
sales agency for a member of producers, a marketing co-operative
society quite often performs some important functions of marketing.
Such as, processing and grading of the product delivered by the
individual producers. Societies of this kind are particularly useful for
agriculturists, small producers and artisans.
4. Housing Co-operative Societies:
Housing co-operatives are the association of persons who are
interested either in securing dealership of a house or obtaining
accommodation at fair and reasonable rent. Such societies join together
to form co-operatives of this kind. Through, these societies they can
25
secure not merely financial assistance, but also the economics of

purchase of building materials in bulk. The membership of such a
society is open to all those who are interested in securing house
accommodation as well as to those who are ready to deposit money in
the society for interest. Each member has to buy at least one share and
the liability is generally limited to his contribution.
5. Credit Co-operative Societies:
The credit co-operative societies are voluntary association of the
people with moderate means formed with the object of extending shortterm financial accommodation to them and developing the habit of thrift
among them, the funds of these societies consists of share capital
contributed by the members, the liabilities of the members are in
generally unlimited. This helps the society in raising funds from
outsiders and ensures that every member shows keen interest in the
working of the society in granting loans, the society may show
concession for the poor people who apply for smaller loans. Besides,
loans may generally be granted only for productive purpose. The society
may or may not as for security of immovable property while making
loans; the rate of interest charged on the borrowings is kept as low as
possible
Credit co-operative societies may be divided into two types they
are,
i. Agriculture Credit Society
ii. Non- agriculture Credit Society
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6. Farming Co-operative Societies :

These co-operative societies are generally agriculture cooperatives framed with t3eh object of achieving the benefits of large
scale farming and maximizing agricultural output, such societies are
advanced for those agricultural countries like India, which suffer from
excessive fragmentation or sub-division of agricultural land holding by
farmer. This membership is generally confined to farmers including
those doing land and those who till the land.
ROLE OF CO-OPERATIVE SOCIETY IN SOCIAL

CHANGES IN INDIA
Co-operative societies are playing a very important role in modern
society. In olden days there were no co-operative society, people were
not aware of the concept itself, but the theory of co-operation or concept
of co-operation is as old as human civilization. They used this, to make
their group for the purpose of living, hunting and working together. He
did know the importance of co-operative society in society in social life,
when one of other person exploited a common man.
In olden days people were exploited by their own masters. The
laborers of the peasant classes of people were ill-treated. The people of
low class and low caste were neglected from the society not getting due
respects. These low class people suffered lot and they were exploited by
the upper class and they were also kept out from the education.
27
After the introduction of the co-operative movement in India in

1904, the people who exploited and who needed a change got a ray of
hope. They started to educate themselves. They give birth to a feeling of
oneness among them and they started to working not only for the people
of themselves but also for welfare of others. However, by making their
co-operatives they enjoyed very much. Their standard of living was
raised. When the government realizes that the groupism is started, then
to stop that groupism, the government took steps in establishing cooperative societies like Financial Co-operatives, Industrial Co-operative
etc., and the government made some resolution to these Co-operative by
passing their Act.
The co-operative system reduced many problems relating to
finance and industry. The people who were borrowing money from lords
were now able to get money or financial assistance by the co-operative
societies. A man by making himself a member can get an amount as loan
and with in the prescribed limit rate of interest. In the earning of profits
of the societies he was given his share of profit in the form of dividend
according to his capital in the society. This reduced the burden of paying
high interest and in turn he gets cash profits from the co-operative
society. By getting all these benefits the life style and standard of living
of common people have increased and totally it is bringing change in
society.
Thus, co-operative societies have made lot of changes in the
Indian society. No one can be exploited by any one due to the coSAHYADRI ARTS & COMMERCE COLLEGE
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operative societies and a common man is safe in the hands of cooperative societies.
BENEFITS OR MERITS OF CO-OPERATIVE SOCIETIES:
Co-operative societies in India have provided many benefits they
are:
1. The most important service of co-operative societies in India is the
provision of agricultural credit. The co-operative credit societies
have provided c heap credit facilities to farmers. These societies,
today, meet about 43%of the credit. Requirements of the farmers,
and thereby, minimize the dependence of the farmers on money
lenders.
2. By supplying credit, better seeds, fertilizers, pesticides and
insecticides, irrigation facilities etc., co-operative societies have
raised the agricultural productivity and production in the country,
and thereby, contributed to the agricultural development of the
country. In fact, co-operative societies are partly responsible for
the Green Revolution that has taken place in some parts of the
country, such as Punjab, Maharastra, and Andhra Pradesh etc.
3. The co-operative marketing societies have been instrumental in
securing remunerative prices for the formers for their produce.
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4. The co-operative marketing societies in urban areas have provided

cheap credit facilities to artisans, craftsmen, small traders and
industrial workers and employees.
5. The producers co-operative societies or the industrial cooperative s
6. Have provided a source of livelihood to artisans and craftsmen.
7. The consumers co-operative societies have opened a chain of
stores and supplied good quality goods at fair prices to buyers in
both urban and rural areas. In fact, consumers co-operative stores
have helped the equitable distribution of essential commodities at
fair prices and helped the Government to hold the price line to a
certain extent.
8. The dairy co-operatives like the Amul have ensured regular
supply of good quality milk and milk products at reasonable prices
to the consumers in towns and cities and better prices for the
producers of milk. The dairy co-operatives are making efforts to
achieve White Revolution in the country.
9. The fisheries co-operatives have contributed to large-scale
production and sale of fishes. They are partly responsible for the
Blue Revolution that is taking place in the country.
10.The co-operative societies have helped in pooling the resources of
the weaker sections of the society for productive purposes.
11.The primary credit societies in rural areas have checked the
wasteful expenditure of the tenants and encouraged the habit of
thrift and saving among the people.
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12.The co-operative societies in rural areas have improved the moral

behavior of the rural people. The made the villagers give up vices,
such as gambling drinking, litigation etc.
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DEFECTS OF THE CO-OPERATIVE MOVEMENT IN INDIA OR

CAUSES FOR THE SLOW GROWTH OF CO-OPERATIVE
MOVEMENT IN INDIA:
The co-operative movement in India suffers from certain
drawbacks. That is why; its growth has been rather slow. The main
defects of the co-operative movement in the country are:
1. The co-operative movement in India has not come from the
people. It is only the Government. Which has taken the initiative
in starting the co-operative societies? So, it has become a
movement of the government and not of the people.
2. The masses of India are illiterate. They are not able to understand
the objectives and the importance of co-operation.
3. The financial resources of the co-operative societies are meager.
So, they are not able to meet the growing needs of the members.
4. Generally, the management of the co-operative societies is not
efficient. Further, in many cases, the management of the societies
has fallen into the hands of dishonest and unscrupulous persons.
5. The recovery of loans from the borrowers is not efficient. Overdues are increasing at an alerting rate.
6. Loans are given without proper enquiry. A number of loans are
given in fictitious names. In many cases, loans are given to the
friends and relatives of the members of the managing committee.
7. There is political intervention in the working of the co-operative
societies.
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8. The co-operative credit societies have failed to mobilize deposits.

They are just acting as agents for the distribution of funds
provided by the Government.
9. There has been too much of emphasis on co-operative credit
societies. Other types of co-operative societies have not been
given much importance.
EVOLUTION OF COOPERATIVES IN INDIA
The cooperative movement in India owes its origin to agriculture
and allied sectors. Towards the end of the 19 th century, the problems of
rural indebted ness and the consequent conditions of farmers created an
environment for the chit funds and cooperative societies. The farmers
generally found the cooperative movement an attractive mechanism for
pooling their meager resources for solving common problems relating to
credit, supplies of inputs and marketing of agricultural produce. The
experience gained in the working of cooperatives led to the enactment of
cooperative
credit
societies
act,
1904.
Subsequently,
more
comprehensive legislation called the cooperative societies act was

enacted. This act, inter alias, provided for the creation of they post of
registrar of cooperative societies and registration of cooperative societies
for various purposes and audit. Under the Montague. Chelmsford
Reforms of 1919, cooperation became a provincial subject and the
provinces were authorized to make their own cooperative laws. Under
the Government of India Act, 1935, cooperatives were treated as a
provincial subject. The item Cooperative Societies is a State Subject
under entry No.32 of the State List of the Constitution of India.
33
In order to cover Cooperative Societies with membership from

more than one province, the Government of India enacted the Multi-Unit
Cooperative Societies Act, 1942. This Act was an enabling legislative
instrument dealing with incorporation and winding up of cooperative
societies having jurisdiction in more than one province. With the
emergence of national federations of cooperative societies in various
functional areas and to obviate the plethora of different laws governing
the same types of societies, a need was felt for a comprehensive Central
legislation to consolidate the laws governing such cooperative societies.
Therefore, the Multi-State Cooperative Societies Act, 1984 was enacted
by parliament under Entry No.44 of the Union List of the Constitution of
India.
After India attained independence in August, 1947, cooperatives
assumed a great significance in poverty removal and faster socioeconomic growth. With the advent of the planning process, cooperatives
became an integrate part of the Five Year Plans. As a result, they
emerged as a distinct segment in our national economy, in the First Five
Year plan, it was specifically stated that the success of the Plan would be
judged, among other things, by the extent it was implemented through
cooperative organizations.
The All-India Rural Credit Survey Committee Report, 1954
recommended an integrated approach to cooperative credit and
emphasized the need for viable credit cooperative societies by expanding
their area of operation, encouraging rural savings and diversifying
34
business.
The
Committee
also
recommended
for
Government
participation in the share capital of the cooperatives.
In view of these recommendations, different States drew up

various schemes for the cooperative movement for organizing large size
societies and provision of State partnership and assistance. During
1960s, further efforts were made to consolidate the cooperative societies
by their re-organization. Consequently, the number of primary
agricultural cooperative credit societies was reduced from around two
lakh to 92,000.
EVOLUTION
In 1958 the National Development Council (NDC) had
recommended a national policy on cooperatives. Jawaharlal Nehru had a
strong faith in the cooperative movement. While opening an
international seminar on cooperative leadership in South East Asia he
had said But my outlook at present is not the outlook of spreading the
cooperative movement gradually, progressively, as it has done. My
outlook is to convulse India with the
Cooperative Movement or rather with cooperation to make it, broadly
speaking the basic activity of India, in every village as well as
elsewhere; and finally, indeed, to make the cooperative approach the
common thinking of India.therefore, the whole future of India really
depends on the success of this approach of ours to these vast numbers,
hundreds of millions of people.
35
The cooperative sector has been playing a distinct and significant

role in the countrys process of socio-economic development. There has
been a substantial growth of this sector in diverse areas of the economy
during the past few decades. The number all types of cooperatives
increased from 1.81
lakh in 1950-51 to 4.53 lakh in 1996-97. The total membership of
Cooperative societies increased from 1.55 crore to 20.45 crore during the
same period. The cooperatives have been operating in various areas of
the economy such as credit, production, processing, marketing, input
distribution, housing, dairying and textiles. In some of the areas of their
activities like dairying, urban banking and housing, sugar and
handlooms, the cooperatives have achieved success to an extent by there
are larger areas where they have not been so successful. The failure of
cooperatives has achieved successful. The failure of cooperatives in the
country is mainly attributable to: dormant membership and lack of active
participation of members in the management of co-operatives. Mounting
overdue in cooperative credit institution, lack of mobilization of internal
resources and over-dependence on Government assistance, lack of
professional management. Bureaucratic control and inter reference in
the management, political interference and over- pulsation have proved
harmful to their growth. Predominance of vested interests resulting in
non-percolation of benefits to a common member, particularly to the
class of persons for whom such cooperatives were basically formed, has
also retarded the development of cooperatives. These are the areas which
need to be attended to by evolving suitable legislative and policy
support.
36
Chapter-IV
SIR M. VISHWESHVARAIAH CO-OPERATIVE SOCIETY LTD.,
SHIVAMOGGA A PROFILE
HISTORY
FEATURES
DEPOSITS
SHARE CAPITAL
NET PROFITS
MANAGEMENT
MEMBERS
37
SMV CO - OPERATIVE SOCIETY LTD.,

SHIVAMOGGA
HISTORY:
Sir M. Vishweshvaraiah Co-operative Society was established

on 4th April 1983. The scope of serv8ices of the society is limited to
Brahmins community only. The area of operation of this society limited
to Shivamogga city only.
Before 1983 in Shivamogga city, the number of co-operative
societies was very less and these societies failed to meet the credit needs
of Brahmins community. At that time, a few leaders of community
decided to establish a xo-operative society.
The first president of this society was Venkataramana Shastri
and the first secretary of this society was B. N. Krishna Murthy whose
services are ever to be remembered. The society was established mainly
with a view to provide credit facilities to its members at a reasonable rate
of interest.
Features of the society
Following are the main features of the SMV co-operative society:
1. According to the byelaw of the society board of directors are not
entitled for taking loans from the society.
2. Society has not taken any loans from government or any other
financial institutions.
38
3. Members are avail to the surety loan up to Rs. 20000. Till date
loan of Rs.85 lakhs has been disbursed under this scheme.
4. Members are avail to the Property loan up to Rs.3 lakhs and Rs.
1.15 crores already granted to the members.
5. For the purchase of two wheeler vehicles the members can take
Rs. 25,000 as Vehicle loan.
6. Loan facilities to the extent of Rs. 50,000 are granted on the
security of NSC, KVP and Gold.
7. The society is granting loan for businessmen up to Rs. 25000.
DEPOSITS:
The deposits of the society increase since from earliest years of its
working, as the confidence of the members increases. The society
receives deposits from the members through the following accounts.
1. savings deposits Account
2. Pigmy Deposits Account
3. Fixed Deposits Account
4. Recurring Deposits Account
39
Following is the table shown the total deposits deposited by the

members during the year 2004-05 to 2008-09.
Sl. No
Years
1
2
3
4
5
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Deposits
1,15,25,941
1,56,44,749
1,83,77,001
2,23,84,028
2,99,96,674
9,79,28,393
According to the Banking Regulation Act, 1966, the society has

been also keeping Rs. 5,00,000 as cash reserve laid down under Sec.
18.
SHARE CAPITAL:
The share capital of the society consists A class shares at Rs1,
000 each. In the year1983-84 the share capital of the society was
Rs.1,79,800 and members of the society was 813 and as confidence
of the members increases the share capital and members (i.e. share
holders) are also increases to 45,59,800 and 5694 respectively.
The following is the table showing the share capital and share
holders of the society during the year 2004-05 to 2008-09
40
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Share Holders
4,513
4,538
4,525
4,545
5,694
23,815
Total
Share Capital
23,66,400
26,08,700
27,36,300
29,96,900
45,59,800
1,52,68,100
NET PROFITS:
In the first annual meeting profits came to Rs. 3, 8425. During the
year 2004-05 to 2008-09 the net profits of the society was as under.
Sl.No
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
41
Net Profits
4,61,034
3,83,129
7,40,521
7,61,999
14,55,047
38,01,730
MANAGEMENT:
The management of the society rest in the board consisting
of 12 directors elected annually at the general meeting. The president,
the vice-president (the treasures are elected from among the
directors). From the beginning the society has been lucky in getting
competent and self sacrificing directors as well as office bearers.
No sitting or other fees is paid any of the directors. With the
increases in the number of members and depositor and the
consequent increase in staff, efficient management has necessitated
greater systematization of work.
MEMBERS:
It cannot be ignored that the building up of this institution
and its growth to its present size are primarily the result of the fact
that a very great majority of the members. The society not only
provides services to its members but also expand the banking
business among the members of the society.
42
The structure of management of Sir M. Vishweshvaraiah Co

operative Society Ltd., Shivamogga can be shown in a chart as
follows:
SHAREHOLDERS
PRESIDENT
VICE PRESIDENT
DIRECTORS
SECRETARY
ACCOUNTANT
CLERKS Cum CASHIERS
SERVANTS
43
Chapter-V
CREDIT FACILITIES IN SMV CO-OPERATIVE

SOCIETY LTD.
INTRODUCTION TO CREDIT
MEANING AND DEFINITION OF CREDIT
TYPES OF CREDIT
CREDIT FACILITIES IN SMV CO-OPERATIVE
SOCIETY LTD.
TYPES OF LOANS GIVEN BY THE SMV COOPERATIVE SOCIETY LTD.
44
MEANING OF CREDIT
Credit means good opinion founded on the belief in a persons
veracity, integrity, ability and virtue. Credit refers to the confidence
in a persons willingness and ability to pay. A persons credit depends on
three Cs Character, Capacity and Capital. It is a combination of all
these qualities which go to make a mans credit. He must be honest and
fair in his dealings with others; he must also have capacity for making
his business a success; and he must be a man of substance. Credit is thus
an attribute of the borrower.
DEFINITION:
The word Credit has been derived from the Latin word Credo,
meaning I believe. Credo however is a combination of the Sanskrit
word, meaning trust and the Latin word do, meaning I place.
According to Wing field Stratford, credit is nothing more or
less than faith and faith no less on the stock exchange than
before the alter, is the substance of things hoped for, the
evidence of things not seen.
According to William Stanley jevons, credit is noting but the
deferring of payment.
According to Cole, credit is purchasing power not derived
from income, but created by financial institutions either as an
offset to idle incomes held by depositors in the banks, or as a
net addition to the total amount of purchasing power.
45
KINDS OF CREDIT
In modern times credit is required for many purposes and is
employed by almost every sector of the economy. Some of the main
types of credit are studies under.
1. Classified on the basis of Use
a. Productive Credit
b. Consumer Credit
Productive Credit:
Producers undertake production on a large scale by depending
upon the banks to finance the purchases of raw materials, wages
payments by seeking overdraft and cash credit facilities from the banks.
The loan facilities given for the purpose is called productive Credit.
Consumer Credit:
In the developed countries of the world the purchases of most
consumer durables such as cars, refrigerators, T.V. sets and the like are
all financed by banks and other financial intermediaries. The loan
provided for this purpose is called Consumer Credit.
2. classified on the basis of period of credit given :
On this basis credit is classified into 3 types. They are

i. Long-term credit
ii. Medium-term credit
iii. Short-term credit
46
Long-term credit:
This type of credit is given for a period between 5to25 years. This
type of loan is used to purchase buildings, machineries or any other fixed
assets and to construct house or re-modification of the machineries etc.
Medium-term credit:
Medium-term credit is granted for a period below 5 years and
above one year. So, medium-term credit stands midway between the
long-term and short-term credit. Formers to setting up of pump sets and
other machineries use this type of loan.
Short-term credit:
Short- term credit is an credit or loan advanced by the banks or
other financial institutions for a period of few days or a few months.
This loan is granted for a period of few days or a few months. This loan
is granted for the purpose of purchasing raw-materials, wage payments
etc.
3. Classified on the basis of Security
a. Secured loan
b. Un-secured loan
47
Secured loan:
Loans are generally granted by the banks and other financial
agencies against the security of tangible assets pledged by the borrower
in favor of the lender is called secured loans.
Unsecured loan:
Loans may, however, be granted without requiring the borrower to
furnish any security of tangible assets are called Unsecured loans.
Functions of credit
Credit performs many useful functions for the economic
prosperity of country thus:
1. Credit economies the use of metallic currency. Credit instruments
serve in place of coins and thus save much unnecessary expense.
2. It helps in the financing of the industry by making possible huge
loans to businessman.
3. It increases the productivity of capital. Idle money, through the
agency of banks, is made available to people, who can use it
productivity.
4. By means of credit, large sums can be lent by banks against small
cash reserves.
5. Credit instruments, especially bill of exchange, greatly facilitate
payments in international trade. Payments can be made without
movement of treasure to any large degree.
48
SIR M. VISHWESHARAIAH CO-OPERATIVE SOCIETY LTD.

Credit facility or loan to members;
SMV Co-operative Society Ltd. Not only accepting deposits from
the members but also providing loans to smaller traders, businessmen
etc. at the reasonable rate of interest. The society lends loans only for
members of the society.
The society knows that all the depositors do not withdraw all their
money at the same time, more over as and when there are withdrawals
the societies get depositors. Again, Secretary makes a proper judgment
while employing the funds a small portion of funds is kept in cash as
CRR.
The balance of funds is employed by way of loans, overdrafts,
cash credit etc. each more of these advances are repayable as dividend.
The loans granted for fixed capital required for purchase or construction
of fixed assets like building, machinery etc repayable within the period
of 3-4 years. The secretary stipulates periodical repayment of
installments towards liquidation of these advances. Thus, by a proper
employment of funds the secretary is able to keep the funds liquid or
repayable at short notice.
49
TYPES OF LOANS PROVIDED BY THE SOCIETY

Following are the types of loans provided by the society to its
members:
1. surety Loan
2. Property Loan
3. Gold Loan
4. Pigmy Loan
5. fixed Deposit Loan
6. Recurring Deposit loan
7. N.S.C Loan
8. K.V.P Loan
9. vehicle Loan
10.business Loan
11.House Construction Loan.
50
Following is the table showing the credit facilities given by the

society to the members during the year 1996-97 to 2000-01.
1.
SURETY LOAN :
This loan is given by society for its members on the security of other
member. It provides this loan up to Rs.20, 000 for each member. The
rate of interest on this loan is 15% P.A.
The table showing surety loan granted by the society during
the years 2004-05to 2008-09.
Sl.No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Surety Loans granted

58,20,000
50,42,000
46,18,100
60,15,000
84,45,500
2,99,40,600
Total
Bar diagram showing the Surety Loan granted by the society during the
year 2004-05to 2008-09. (in lakhs)
100
80
60
Surety loan
40
20
0
2.
PROPERTY LOAN
51
This loan is given by the society for its members against fixed
assets. It provides property loan up to Rs.3, 00,000 for each
member. The rate of interest charged on property loan is 15% P.A.
Table showing the property loan granted by the society
during the years 2004-05to 2008-09
Sl.No
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Property loans granted

24,54,000
32,60,000
27,24,000
52,50,000
51,50,000
1,88,38,000
Bar diagram showing the Property Loan granted by the

society during the year 2004-05to 2008-09. (In lakhs)
60
50
40
30
Property loan
20
10
0
3.
GOLD LOAN :
The society provides loans against gold and jewelers for the
members. The members are avail to taken for this loan up to Rs.50, 000
and the rate of interest is 15% P.A
52
Table showing the Gold loan granted by the society during the
year 2004-05to 2008-09
(In terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Gold Loans granted

656.64,650
5,11,650
4,88,400
4,66,150
4,86,800
26,17,650
Bar diagram showing the Gold Loan granted by the society during
the year 2004-05to 2008-09 (in lakhs)
8
6
4
Gold loan
2
0
4.
PIGMY LOAN :
The society provides loans to its members on the basis of
amount deposited in Pigmy Deposit Account. The society
charges interest on the above loan is 2% higher the interest
given on the deposit amount.
53
Table showing the pigmy loan granted by the society

during the year 2004-05to 2008-09
(in terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Pigmy Loans granted

3,69,425
3,49,450
5,06,800
3,38,700
4,43,450
20,07,825
Bar diagram showing the pigmy loan granted by the society during
6
5
4
3
Pigm y loan
2
1
0
54
5.
FIXED DEPOSIT LOAN :
The society also provides loans to its members on the basis of deposit
made by them to fixed deposit account.
Table showing fixed deposit loan granted during the year 200405to 2008-09
(in terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Fixed Loans granted

5,73,150
8,40,175
7,32,900
12,10,000
16,39,650
49,95,875
Bar diagram showing the fixed deposit loan granted by the society
during the year 2004-05to 2008-09 (in lakhs)
20
15
10
Fixed Deposit
5
0
6.
RECURRING DEPOSIT LOAN
55
The recurring deposit loan is given to the members by the society on

the basis of deposits made by them to recurring deposits account.
Table showing recurring deposit loan granted by the society
during the year 2004-05 to 2008-09
(In terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Recurring Deposit Loans granted

15,575
33,250
58,750
30,150
96,800
2,34,525
Bar diagram showing the Recurring deposit loan granted by the

society during the year 2004-05 to 2008-09 (in lakhs)
100
80
60
Recurring deposit loans
40
20
0
56
7.
N.S.C LOAN :
The society provides N.S.C loan to its members on the security of

National Saving Certificate. The society grants this loan to the extent of
75% of the face value of the certificate if it is above 2 years.
Table showing the N.S.C loan granted by the society during
the years 2004-05to 2008-09
(In terms of Rs.)
Sl. No.
1
2
3
4
5
Years
N>S>C Loans
2004-05
2005-06
2006-07
2007-08
2008-09
granted
2,79,500
1,42,450
92,860
84,425
1,34,000
7,33,235
Total
Bar diagram showing the N.S.C loan granted by the society during
300
250
200
150
N.S.C Loan
100
50
0
8.
K.V.P LOAN :
57
By pledging Kisan Vikas Patra Certificates the members are avail to

taken for loan up to Rs.25, 000
Table showing the K.V.P loan granted by the society during the
years 2004-05to 2008-09.
(In terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Gold Loans granted

91,500
93,250
1,11,750
36,200
1,29,800
4,62,500
Bar diagram showing the K.V.P loan granted by the society during
140
120
100
80
K.V.P Loan
60
40
20
0
58
Chapter-VI
RECOVERY OF LOANS IN CO-OPERATIVE

SOCIETY LTD.
INTRODUCTION
RECOVERY OF LOANS IN SMV CO-OPERATIVE
SOCIETY LTD.
59
RECOVERY OF LOANS
The circle of funds will be completed only when the issued
amounts are recovered and re-issued. Therefore, in other words recovery
means the collection of dues or repayment of loans amounts.
Loan amount cannot be recovered unless the loans are
persuading properly owning to their personal problems and other
reasons. Some times loans are unable to repay the loan amount in time.
In such cases they should contact personally and they will be granted
further period to repay their loans. This time extended to them is called
Extension of loans. A special provision as made in the loans by
institution to extend extension of times.
After the expiry of the original period the loans were
charged with additional interest. It is called Penal interest. Generally,
penal interest will be changed at 2% interest above the original rate of
interest.
SIR.M.VISHWESHARAIAH CO-OPERATIVE SOCIETY LTD.
From one year to another year the society has gained more and
more profit and has economic progress. The society has worked a lot for
the upliftment of the poorer class of people to come forward.
60
Different types of loans issued by this society and amount

recovered and its performance would be glanced from the table given
below:
1.
SURETY LOAN :
Table showing surety loans advanced and recovered by the society

during the year 2004-05to 2008-09.
(In terms of Rs.)
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Surety Loans
Surety loan
Advanced
58,20,000
50,42,000
46,18,100
60,15,000
84,45,500
2,99,40,600
Recovered
46,54,715
46,49,986
50,45,722
58,70,580,
59,13,191,
2,61,34,194
The above table reveals the performance of the society during the
period of 2004-05to 2008-09. it shows the total amount of surety loan
sanctioned Rs.2,99,40,6000 and total amount of surety loan recovered
Rs.2,61,34,194 by the society.
61
Bar diagram showing the surety loans advanced and recovered by

the society during the year 2004-05to 2008-09. (In lakhs)
90
80
70
60
50
Advanced
Recovered
40
30
20
10
0
62
2.
PROPERTY LOAN:
Table showing property loan advanced and recovered by the

society during the year 2004-05to 2008-09.
Sl.
Years
property Loans
Property loans
No.
1
2004-
Advanced
24,54,000
Recovered
9,17,581
05
2005-
32,60,000
12,67,804
06
2006-
27,24,000
19,70,486
07
2007-
52,50,000
27,82,135
08
2008-
51,50,000
33,02,254
1,88,38,000
1,02,40,200
09
Total
period of 2004-05to 2008-09. It shows the total amount of Property loan
sanctioned Rs.1, 88, 38,000 and total amount of Property loan recovered
Rs.1, 02, 40,200.
63
Bar diagram showing the property loans advanced and recovered by

60
50
40
Advanced
Recoved
30
20
10
0
64
3.
GOLD LOAN :
Table showing Gold loans advanced and recovered by the society

Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Gold Loans
Gold loan
Advanced
6,64,650
5,11,650
4,88,400
4,66,150
4,86,800
26,17,650
Recovered
5,13,206
5,03,606
4,41,164
6,10,029
5,63,513
26,31,518
period of 2004-05to 2008-09. it shows the total amount of Gold loan
sanctioned Rs.26,17,650 and total amount of Gold loan recovered Rs.
26,31,518 by the society.
65
Bar diagram showing the Gold loans advanced and recovered by the
society during the year 2004-05to 2008-09. (in lakhs)
7
6
5
4
Advanced
Recovered
3
2
1
0
66
4.
PIGMY LOAN :
Table showing pigmy loans advanced and recovered by the

Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Pigmy Loans
Pigmy loan Recovered
Advanced
3,69,425
3,49,450
5,06,800
3,38,700
4,43,450
20,07,825
3,72,018
3,31,070
3,96,012
4,47,421
4,06,379
19,52,900
The above table revels the performance of the society during the
period of 2004-05to 2008-09. it shows the total amount of Pigmy loan
sanctioned Rs.20,07,825 and total amount of Pigmy loan recovered
Rs.19,52,900 by the society.
67
Bar diagram showing the Pigmy loans advanced and recovered by

6
5
4
3
2
1
0
Advanced
Recovered
68
5.
FIXED DEPOSIT LOAN :
Table showing Fixed Deposit Loans advanced and recovered by the

Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Fixed Deposit Loans
Fixed Deposit loan
Advanced
5,73,150
8,40,175
7,32,900
12,10,000
16,39,650
49,95,875
Recovered
5,99,955
8,13,032
5,86,818
10,87,280
16,78,022
47,65,107
The above table reveals the pe4rformance of the society during the
period of 2004-05to 2008-09. it shows the total amount of Fixed Deposit
Loan sanctioned Rs.49,95,675 and total amount of Fixed Deposit Loan
recovered Rs.47,65,107 by the society.
69
Bar diagram showing the Fixed Deposit loans advanced and

recovered by the society during the year 2004-05to 2008-09. (In
lakhs)
18
16
14
12
10
8
6
4
2
0
Advanced
70
Recovered
6.
RECURRING DEPOSIT LOAN :
Table showing Recurring Deposit loans advanced and recovered by

the society during the year 2004-05to 2008-09
Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
Recurring Deposit
Recurring Deposit
Loans Advanced
15,575
33,250
58,750
30,150
96,800
2,34,525
loan Recovered
12,255
25,000
62,900
30,265
89,513
2,19,733
period of 2004-05to 2008-09. it shows the total amount of Recurring
Deposit loan sanctioned Rs. 2,34,525 and total amount of Recurring
Deposit loan recovered Rs. 2,19,733 by the society.
71
Graph showing the recurring deposit Loan advanced and recovered

by the society during the year 2004-05to 2008-09. (In lakhs)
100
90
80
70
60
Advanced
Recovered
50
40
30
20
10
0
72
7)
N.S.C LOAN :
Table showing N.S.C loans advanced and recovered by the society

Sl. No.
Years
1
2004-05
2
2005-06
3
2006-07
4
2007-08
5
2008-09
Total
N.S.C Loans Advanced

2,79,500
1,42,450
92,860
84,425
1,34,000
733,235
N.S.C loan Recovered

1,34,300
97,642
1,45,292
1,43,719
1,58,426
6,79,379
period of 2004-05to 2008-09. it shows the total amount of N.S.C
loan sanctioned Rs.7,33,235 and total amount of N.S.C loan
recovered Rs.6,79,379 by the society.
73
Bar diagram showing the N.S.C loans advanced and recovered

by the society during the year 2004-05to 2008-09. (In Lakhs)
300
250
200
150
100
50
0
Advanced
Recovered
74
1.
K.V.P LOAN :
Table showing K.V.P loans advanced and recovered by the society

Sl. No.
1
2
3
4
5
Years
2004-05
2005-06
2006-07
2007-08
2008-09
Total
K.V.P Loans Advanced
K.V.P loan
91,500
93,250
1,11,750
36,200
1,29,800
4,62,500
Recovered
49,65
94,890
62,495
71,589
54,479
3,33,418
The above table revels the performance of the society

during the period of 2004-05to 2008-09. It shows the total amount
of K.V.P loan sanctioned Rs.4,62,500 and total amount of K.V.P
loan recovered Rs.3,33,418 by the society.
75
Bar diagram showing the K.V.P loans advanced and

recovered by the society during the year 2004-05to 2008-09.
(in lakhs)
140
120
100
80
Advanced
Recovered
60
40
20
0
76
Chapter-VII
ANALYSIS OF RESPONSE
INTRODUCTION
ANALYSIS OF RESPONSE
MAJOR SUMMARY OF FINDINGS
77
INTRODUCTION
Survey means going into the depth o the responses and collecting
inner expression for the purpose of knowing attitude of the respondents
about which the survey is conducted.
The purpose of conducting the survey is the in-depth study of the
attitude of the members and problems faced by the them while dealing
with Sit. M. Vishweshvaraiah Co-operative Society Ltd., Shivamogga.
For the purpose of survey questionnaire was prepared and was
given to 50 members. The entire area covered by the survey is classified
into different parts and the members are given the format of
questionnaire and are requested to fill it and return to us.
The survey has been successfully carried out and the respondents
are having close contact with the society. They gave good and realistic
answers to the questions.
Their answers and replies are analyzed as follows:
78
TABLE -1
For the propose of survey the respondents are classified on the
basis of their age under 4 categories.
Table showing classification of members on the basis of their age
Group.
Sl.No
1
2
3
4
Age Group
18-25 Yrs
25-40 Yrs
40-50 Yrs
Above 50Yrs
Total
No of Respondents
11
10
7
22
50
%
22
20
14
44
100
The above table shows that 44% of respondents are from

the age group of above 50 years, followed by 22% of respondents
from the age group of 18-25 years, while 20% o respondents from
the age group of 25-40 years and 14% of the respondents are from
the age group of 40-50 years.
50
40
30
Age Group(in %)
20
10
0
79
TABLE 2
Table showing classification o members on the basis of
Gender.
Sl.No
1
2
Gender
Male
female
Total
No of Respondents
38
12
50
%
76
24
100
In the above table, the response obtained from the male members
is in more numbers i.e. 76% and remaining 24% of respondents
are female members who are in less.
80
70
60
50
40
Gender ( in % )
30
20
10
0
80
TABLE 3
Table showing classification of members on the basis of their
Occupation.
Sl.No
1
2
3
occupation
Business
Professionals
Govt.
No of Respondents
5
6
8
%
10
12
16
31
50
62
100
Employees
others
Total
In the above table, we can find that majority of individuals belong

to others group (includes House wife and students) they constitute
62% of respondents, 16% of total respondents are belong to
business who are less in numbers.
70
60
50
40
Occupation(in%)
30
20
10
0
81
TABLE 4
Table showing distribution of respondents according to
their monthly income.
Sl.No
1
2
3
4
Income (in Rs.)

Below 5,000
21
10,000-20,000
Above 20,000
Total
No of
Respondents
14
10
11
4
50
28
42
22
8
100
From the above table we come to know that 42% of respondents

belong to middle income group followed by 28% of respondents
belong below 5,000, while 22% of respondents belong to income
group of 10,000-20,000 and 8% of respondents belong to income
group of above 20,000.
50
40
30
Monthly Incom e(in%)
20
10
0
82
TABLE -5
Table showing distribution of respondents on the basis of
period of Contact with society.
Sl.No
1
2
3
4
period
Below 2 yrs
2-5 Yrs
5-10 Yrs
Above 10 yrs
Total
No of Respondents
10
15
8
17
50
%
20
30
16
34
100
From the above table, we can see that respondents who

have contact with the society above 10 years are given good
suggestions. And in the above table the number of respondents
who are dealing with society for below 2 years, 2-5 years and 5-10
years are in 10%, 15% and 8% respectively.
35
30
25
20
Period of Contact(in%)
15
10
5
0
83
TABLE 6
Table showing distribution of respondents on the basis of
Opinion about society services.
Sl.No
1
2
3
4
Opinions
Excellent
Good
Satisfactory
Bad
Total
No of Respondents
9
24
15
2
50
%
18
48
30
4
100
In the above table, 48% of total respondents states that society

services is good, while 30% of total respondents states that satisfactory
and
18% o respondents states that excellent followed by 4%of
respondents states that the society service is bad.
50
40
30
Opinion about Society Service (in

%)
20
10
0
84
TABLE -7
Table showing distribution of respondents according to
Borrowings of Loans.
Sl.No
1
2
Borrowings
Yes
No
Total
No of Respondents
35
15
50
%
70
30
100
From the above table it shows that 70% of the total respondents
borrow loan from the society and remaining 30% of total respondents
replied that they have not borrowed any loan from the society.
70
60
50
40
Borrowing(in%)
30
20
10
0
85
TABLE 8
Table showing classification of respondents on the basis of the
Type of loan required by the member. (ONLY APPLICABLE TO 35
MEMBERS)
Sl.No
Type of loan
No of Respondents
1
2
3
required
Long-term
Medium-term
Short-term
Total
20
10
5
35
57
29
14
100
From the above table, we can easily understood that the long-term
loan required by the members are in 57% of total respondents, while
29% of the respondents requires medium-term loans and 14% of the
respondents requires short-term loans.
60
50
40
30
Types of loans required(in%)
20
10
0
86
TABLE-9
Table showing the classification of members on the basis of
satisfaction regarding loan facilities provided by the society.
Sl.No
1
2
satisfaction
Yes
No
Total
No of Respondents
29
6
5350
%
83
17
100
In the above table, 29 respondents were satisfied out of 35

respondents (83%) with the loan facilities provided by the society and
remaining 17% of total respondents are dissatisfied with loan facilities
given by the society.
90
80
70
60
50
Satisfaction(in%)
40
30
20
10
0
87
TABLE -10
Table showing the types of loan borrowed by the members.
Sl.No
Types of loans
No of
1
2
3
4
5
6
Surety loan
Property loan
Gold loan
Pigmy loan
Fixed deposit loan
Recurring deposit loan
Respondents
20
6
5
-
57
17
17-
7
8
9
N.S.C loan
K.V.P loan
Vehicle loan
Total
4
35
9
100
From the above table, it is clear that 57% of members are

borrowed Surety loan and 17%of members are borrowed Property and
Gold loan, while 9%of respondents utilized the vehicle loan facility for
purchasing two wheeler vehicle and remaining all the schemes are not
utilized by the members.
60
50
40
30
Types of loans in Society(in%)
20
10
0
88
TABLE 11
Table showing the opinion of the members regarding interest
charged on loans.
Sl.No
1
2
3
Opinion
High
Reasonable
Low
Total
No of Respondents
5
23
7
35
%
14
66
20
100
From the above table shows that 66% of respondents are satisfied
with the interest charged on loans, while 20% of members states that
interest charged on loan by the society is low and 14% of respondents
states that interest charged on loans is high.
70
60
50
40
Openion(in%)
30
20
10
0
89
TABLE 12
Table showing the opinion o members regarding installment
ford the repayment of loan.
Sl.No
1
2
3
Opinion
More
Reasonable
Low
Total
No of Respondents
9
22
4
35
%
26
63
11
100
From the above table, we can see that the 22 respondents are
satisfied with installment given by the society for repayment of loan,
while 63% of the total respondents are moderately satisfied and 11% of
the total respondents are dissatisfied with the number of installments
given by the society for repayment of loan.
70
60
50
40
Openion(in%)
30
20
10
0
90
MAJOR SURVEY FINDINGS

Survey has been probed into the activities of co-operative society
in general and Sir M. Vishweshvaraiah Co-operative Society LTD. In
particular. For the survey conducted the following are the summery of
observations.
For the purpose of survey members are classified into 4 categories
i.e., 18-25 years, 40-50 years and above 50 years. The age group
of above 50 years is more in numbers and given good suggestions,
since they have long contact with the society. The society
considers the suggestions given by the sinio4r members.
The society should concentrate on female members because they
are less in number. And, it should take necessary measures to
increase female members also.
The majority of members are belonging to middle-income group.
Hence society should concentrate on the mobilization of savings
of middle-income class of members.
Majority of the respondents are satisfied with the services
provided by the society, but till society should improve its
services.
The respondents who are borrowed loan from the society are more
in numbers and there is also some of the members who are not
borrowed any loan from society. Therefore, society should
concentrate on those who are not borrowed any loan from the
society.
91
Most of the members are required Long-term and medium-term

loans. So, the society increases its long-term loans by reducing
short-term loans.
The loan facilities given by the society is satisfied to the majority
of the members but, till society should take measures to satisfy
other members.
The maximum members utilize only surety loan, property loan,
gold loan and vehicle loan. So, the society should re-arrange all
those loan facilities which are not utilized by the members.
Interest charged on loan is moderately satisfied to members and
society further decrease its interest rate and att45ract more
members
The number of installment given by the society for repayment of
loan is satisfied for maximum members. So society should try to
adopt new methods to collect debts from the members.
92
Chapter VIII
SUGGESTIONS AND CONCLUSTION

PROBLEMS AND SUGGESTIONS
CONCLUSION
93
INTRODUCTION
For the improvement of any organization, it should take proper
action or measures for continuous improvement on the basis of opinions
given by respondents and observations made during the survey the
following suggestions have been given for improvement of performance.
While dealing with the society some of the members are found satisfied
and some of them are found dissatisfied. However measures should be
taken to all categories of members.
PROBLEMS AND SUGGESTIONS
While doing the survey some of the members gave the opinion by
expressing their problems and some of them gave suggestions for their
problems. They are:
1.
EDUCATION LOAN :
Most of the members were not properly educated. So, the society should
concentrate on the education of the members and should provide loan
facilities to the higher education.
2.
INCREASE LOANS AMOUNT :

Majority of the members are complaining about loan amount. The loan
amount granted by the society is low.
The society should re-arrange its loan facility given and those loan
schemes which are not utilized by the members should reduce amount on
which the members required.
94
3.
TEDIOUS PROCEDURES :
The procedures made by the society for granting loans are very long
and it is difficult to borrow loan for the members who are in urgent.
The society should shorten its provisions and procedures as
possible as low. And, society should give loan facilities for members
who are in urgent.
4.
SHARE CAPITAL :
To meet the above requirements and to give best services to its
members the society should increase its share capital by raising funds.
95
CONCLUSION
No doubts, Sir. M. Vishweshvaraiah Co-operative Society is
working in the right direction. It cannot be ignored, since its
establishment it is striving hard for improving the economic conditions
of the members. At the same time it is servicing its members in various
ways i.e., advancing loans as and when needed at cheaper rate of
interest, collects deposits from their savings, work
for welfare of
members etc. loan distribution and collection system is also good and
majority of the members were satisfied. Loan is allotted without
discrimination members are satisfied with the working of the society.
But it is necessarily that society should always orient its activities
towards welfare of members. It is will-known fact that the therefore, it is
necessary that society should always aim at continuous development or
adoption which will be more helpful to the members of its services. The
opinion of each member should be of great importance in taking steps
towards development. Therefore, research studies like the present one
may help the society to re-orient its strategy related to advancing loans,
deposits, mobilization and provision of different services.
96
Chapter IX
ANNEXURES
QUESTIONNAIRE
BIBLIOGRAPHY
97
CONSUMER QUESTIONAIRE
Dear Respondents:
I am a Student of Final Year B.B.M in SAHYADRI ARTS &
COMMERCE
COLLAGE.
Shivamogga.
Conducting
CREDIT
FACILITIES AND RECOVERIES OF DEBTS IN CO-OPERATIVE

SOCIETY, a case study of Sir M. Vishweshvaraiah co-operative society
Ltd., Shivamogga. part of My Management Course. I Shall Be Grateful. If
you can spare a Few minutes to answer this questionnaire.
Thanking You,
Niranjan.K.R
1. NAME :
___________________________
2. ADDRESS :
____________________________
____________________________
3. OCCUPATION :
Business
Professional
Govt employee
others
20-25 years
25-30 years
30-35 years
Above 35 years
4. Age :
5. Income Range :
Below - 5,000
5,000-10,000
10,000- 15,000
Above-15,000
6. Are you aware of co-operative societies?

Yes
No
7. Do you feel that co-operative services are essential?

Yes
No
98
8. Are you a member of Sir M. Vishweshvaraiah co-operative society

Ltd., Shivamogga?
Yes
No
9. Since how many years you are dealing with the society?
Below 2 Yrs
2 - 5 Yrs
5 10 Yrs
above 10 Yrs
10. What is your opinion regarding society services?

Excellent
Good
Satisfactory
Bad
11. Have you borrowed loans from the society?

Yes
No
12. What type of loan you usually go for?

Short
Long
Medium
Other
13. What type of loan you have borrowed?

Surety loan
Property loan
Gold loan
Other
14. Interest charged against loans and advances is

High
Low
Reasonable
Others
15. Are you satisfied with the rules of the society with regard to the
society?
Yes
No
16. What is your opinion regarding installment for repayment of loans?

More
Less
Reasonable
other
99
17. Are you satisfied with the rules of the society with regard to recovery
loans?
Yes
No
18. Anymore suggestions:

__________________________________________
__________________________________________
Signature
Date:
Place:
100
BIBLIOGRAPHY

B.S.Mathur
INDIAN ECONOMICS
K.K. Dewett
J.D. Varma
M.L.Sharma
MONEY, BANKING AND FINACE

K.P.M. Sundharam
MODERN ECONOMECS
K.K.Dewett
ELEMENTS OF INDIAN ECONOMICS

B.S.Raman
ANNUAL REPORTS
Sir. M. Vishweshvariah Co-operative
Society Ltd., Shivamogga
101

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ONE FOR ALL, ALL FOR ONE

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

ONE FOR ALL, ALL FOR ONE

To express out own opinion about the societys development and

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SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

LIMITATIONS OF THE STUDY

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

CO-OPERATIVE MOVEMENT IN INDIA

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

Following are the stages of Co-operative Movement in India;

ONE FOR ALL, ALL FOR ONE

III rd STAGE 91919 29)

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THE Ist FIVE YEAR PLAN (1951 - 56)

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

THE IInd FIVE YEAR PLAN (1955-56)

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

Progress during the III rd plan

ONE FOR ALL, ALL FOR ONE

are; the re-organization of rural credit in RBI; involving the

Agricultural Credit Board; the setting up of a small farmers development

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

Vth FIVE YEAR PLAN (1974 79)

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

ONE FOR ALL, ALL FOR ONE

Social and Moral Benefits

special and moral benefits to the people they are:

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

SAHYADRI ARTS & COMMERCE COLLEGE

ONE FOR ALL, ALL FOR ONE

MEANING AND DEFINITION

SAHYADRI ARTS & COMMERCE COLLEGE

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Features of Co-Operative Organization

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operative society may be carried on by two or more members working in

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7. State control and co-operative status:

The features of the co-operative organization outlined above were

SAHYADRI ARTS & COMMERCE COLLEGE

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TYPES OF CO-OOPERATIVE SOCIETY

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This is the oldest form of co-operative organization. In India,

3. marketing Co-operative Societies:

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secure not merely financial assistance, but also the economics of

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