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| TN govt to strengthen cooperative societies, banks |
| BS Reporter / Coimbatore Jul 08, 2009, 15:24 IST |
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The Tamil Nadu government is planning to strengthen cooperative societies and banks in the state by improving their financial liability, rationalising the surplus staff and adopting new technologies.
The state has been a pioneer in the cooperative movement has short-term credit structure and long-term cooperative credit structure.
Short-term consists of the Tamil Nadu State Apex Cooperative Bank at State level with 45 branches, 23 District Central Cooperative Banks (DCCBs) at the district level with 734 branches and 4,522 Primary Agricultural Cooperative Credit Societies (PACCS) catering mainly to rural population, according to a government official.
The Tamil Nadu State Apex Cooperative Bank, federation of the DCBBs, raises resources from public deposits, refinance from National Bank for Agriculture and Rural Development (NBFARD), loan from National Cooperative Development Corporation had a share capital of Rs 61.07 crore including government’s share of Rs. 0.26 crore, reserves to the tune of Rs 718.54 crore and deposits of Rs 4,465.23 crore, according to state government's policy note.
The bank has earned a net profit of Rs 15.12 crore in 2007–08 and hoping to report Rs 45.92 crore in 2008-09.
A MoU was signed with NBARD to develop an action plan for Central Cooperative Banks (CCBs) and PACCS to make these banks and societies a profit ones.
One of the major plans includes Any Where Banking, Core Banking and provide ATMs. The process is expected to be completed in 2009- 10.
Similarly to gear up DCCBs 375 new persons were inducted in 2008-09 and all the remaining vacancies are to be filled in 2009-10.
DCCBs cater to PACCS, other cooperatives such as sugar mills, dairy societies, weaver societies and the public. As on March 31, 2009, net deposits and net outstanding of all DCCBs stood at Rs 10,317.31 crore (Rs 8,849.44 crore) and Rs 12,621.62 crore, respectively.
Common banking software has been tested across 11 branches, which will be extended to other branches by November 2009.
Long Term Cooperative Credit Structure consists of Apex Bank, The Tamil Nadu Cooperative State Agriculture and Rural Development Bank (TNCSARDB) and 180 Primary Cooperative Agriculture and Rural Development Banks (PCARDBs) at Taluk / Block levels, provide investment credit to the members for agricultural activities like minor irrigation, horticulture, plantation crops and other allied sectors.
Operations of these banks had come to halt virtually since 2004 due to lack of refinance.
In 2009–10, the TNCSARDB to step-up its lending operation by mobilising additional resources including refinance from NBFARD.
The government also decided to take steps to revive the 180 Primary Cooperative Agriculture and Rural Development Banks (PCARDBs) by mobilising resources through collection of over dues which is the tune of over Rs 160 crore, in non-farm sector and with the amount available under loan waiver schemes.
To attain financial viability in 2009 -10, these banks are going to focus on disbursing more jewel loans besides lending to project based agriculture and others.
The three important measures which the government is looking at to revive these banks are redeploying excess staff, cash credit for jewel loan business for all the Banks is being sanctioned at lesser rate of interest and the amount due to these PCARDBs on account of waiver, interest relief and One Time Settlement schemes is being released, after adjusting their dues.
To equip the 120 Urban Cooperative Banks (UCBs), provides banking service to urban and semi urban population, to compete with other banks the state government signed a MoU with the Reserve Bank of India to improve the functioning and planning to computerise all the banks and the branches.
In 2008-09, UCBs sanctioned loans to the extent of Rs 3,071.32 crore, deposits rose by 17 per cent to Rs 3,113.07 crore as on March 31, 2009 from Rs 2655.47 crore, a year ago.
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