We might distinguish between co-operative banks and industrial banks on the subsequent counts:
- Commercial banks square measure joint-stock banks.
- a) Co-operatives banks, on the opposite hand, square measure co-operative organizations.
- Commercial banks square measure ruled by the Banking Regulation Act.
- b) Co-operative banks square measure ruled by the Co-operative Societies Act of 1904.
- Commercial banks square measure subject to the management of the banking concern of Asian nation directly.
- c) Co-operative banks square measure subject to the principles ordered down by the Registrar of Co-operative Societies.
- Commercial banks in Asian nation square measure on a bigger scale. They need adopted the system of branch banking, so that they have broad operations.
- d) Co-operative banks have lesser scope in providing a spread of banking services than Commercial banks.
- Commercial banks in Asian nation square measure of 2 types:
(i) Public sector banks and
(ii) Personal sector banks.
- e) Co-operative banks square measure personal sector banks.
Co-operative banks square measure comparatively on a way smaller scale. Several co-operative banks follow solely unit-bank system, although there square measure cooperative banks with variety of branches however their coverage isn’t broad.
- Commercial banks largely give short finance to business, trade and commerce, as well as priority sectors like exports, etc.
- f) Co-operative banks sometimes cater to the credit desires of agriculturists.
- Co-operative banks provide a rather higher rate of interest to their depositors than industrial banks.
- In co-operative banks, borrowers square measure member shareholders, so that they have some influence on the disposition policy of the banks, on account of their vote power.
Borrowers of economic banks square measure solely account- holders and don’t have any vote power intrinsically, so that they cannot have any influence on the disposition policy of those banks.
- Co-operative banks haven’t abundant scope of flexibility on account of the rigidities of the bye-laws of the Co-operative Societies.
- g) Commercial banks, on the opposite hand, square measure free from such rigidities.
The structure of cooperative network in Bharat is divided into two broad segments-
- Urban Cooperative Banks
- Rural Cooperatives
Urban Cooperatives is additional divided into regular and non-scheduled.
Each the class’s square measure additional divided into multi-state and single-state. Majority of those banks fall within the non-scheduled and single-state class.
Urban Cooperative Banks:
Banking activities of Urban Cooperative Banks square measure monitored by run batted in. Registration and Management activities square measure managed by Registrar of Cooperative Societies (RCS). These RCS operate in single-state and Central RCS (CRCS) operate in multiple state.
Rural Cooperative Banks:
Rural Cooperatives the agricultural cooperatives square measure additional divided into short-run and long-run structures.
The short-run cooperative banks square measure 3 beds in operation in numerous states. These are- State Cooperative Banks- They operate at the apex level in states District Central Cooperative Banks-They operate at the district levels Primary Agricultural Credit Societies-They operate at the village or grass-root level. Likewise, the long-run structures square measure additional divided into – State Cooperative Agriculture and Rural Development Banks (SCARDS)- These operate at state-level.
Cooperative Agriculture and Rural Development Banks (PCARDBS)-They operate at district/block level. The agricultural banking cooperatives have a posh observation structure as they need a twin management that has junction rectifier to several issues.
A Forum referred to as State Level Task Force on Cooperative Urban Banks (TAFCUB) has been set-up to appear into problems associated with duality up to the mark. All banking activities square measure regulated by a shared arrangement between run batted in and NABARD. All management and registration activities square measure managed by RCS.
What role does a Non-Governmental Organisation (NGO) play in provision of Micro Credit?
A Non-Governmental Organisation (NGO) is a voluntary organization established to undertake social Intermediation like organizing SHGs of micro entrepreneurs and entrusting them to banks for credit linkage or financial intermediation like borrowing bulk funds from banks for on-lending to SHGs.
How many types of micro credit providers are there in India and what is the present legal framework governing them ?
The position is as under:
Categories of Providers Legal Framework governing their activities
(a) Domestic Commercial Banks:
Public Sector Banks;
Private Sector Banks &
Local Area Banks
(i) RBI Act 1934/
(ii) BR Act 1949
(iii) SBI Act
(iv) SBI Subsidiaries Act
(v)Acquisition & Transfer of Undertakings Act 1970 & 1980
(b) Regional Rural Banks i. RRB Act 1976
ii. RBI Act 1934
iii. BR Act 1949
(c) Co-operative Banks i. Co-operative Societies Act
ii. BR Act 1949 (AACS)
iii. RBI Act 1934 (for sch. banks)
(d) Co-operative Societies (i) State legislation like MACS
(e) Registered NBFCs (i) RBI Act 1934
(ii) Companies Act 1956
(f) Unregistered NBFCs (i) NBFCs carrying on the business of a FI prior to the
coming into force of RBI Amendment Act 1997 whose
application for CoR has not yet been rejected by the Bank
(ii) Sec. 25 of Companies Act
(g) Other providers like Societies, Trusts, etc. (i) Societies Registration Act ’60
(ii) Indian Trusts Act
(iii) Chapter IIIC of RBI Act ’34
(iv) State Moneylenders Act