1

A
Project Report

On

Comparative study of services offered by Private & Co-operative

Banks

By
Mr. Sohan Gaikwad
Roll no-SC-049
Sem III

Class: SYBBA
(Specialization: Financial Management)

Under the
guidance of
Dr. Amol
Mane

In Partial
Fulfilment
of
Bachelor Degree in Business
Administration Submitted To
2

Alandi (D),
Pune

Affiliated to

Savitribai Phule Pune University

Academic Year 2022-2023

3

MAEER’s

Alandi (D), Pune- 412105

Affiliated to Savitribai Phule Pune University& Recognized by Government of

Maharashtra
(IDNO. PU/PN/ASC/289/2007)(AISHE Code: C-42151)
CERTIFICATE

This is to certify that, the project report entitled Impact of covid 19 on the
investment preferences of people in pune city which is submitted by Mr.
Sohan Gaikwad Class: SYBBA in partial fulfilment of Bachelor of Business
Administration has satisfactorily completed the project work under our
guidance and supervision.
We wish our best wishes for his/her future endeavor.

DR. AMOL MANE DR. Mangesh Bhople DR. B.B. WAPHARE

Project Guide Head of the Dept. principle
BBA&BBA IB Dept.
4

ACKNOWLEDGEMENT

I take this opportunity to express my sincere gratitude to everyone who has directly
or indirectly helped me in completing the project successfully.

I am very much thankful to Prof. Dr. B.B. Waphare, Principal of

MIT ACSC, Alandi for his continuous support and help.

I express my deep sense of gratitude to Dr. Amol Mane, HOD of BBA & BBA
(IB) Dept., MIT ACSC, Alandi, Pune as project guide guide for his constant
encouragement-throughout this project report.

I am also thankful to Mr. , Branch Manager, XYZ Bank for permitting me to

conduct a project on the topic ‘Comparative study of services offered by
Private & Co-operative Banks

I take this opportunity to thank my family members and friends without their
cooperation it would not have been possible to complete this project.

Date: 27 JAN 2023

Student Name: Sohan Gaikwad

Class: SYBBA-C
5

DECLARATION

I, hereby declare that the project report on “ Comparative study on services

offered by Private & Co operative Banks ” is written and submitted by me
to MAEER’S MIT Arts, Commerce and Science College, Alandi (D), Pune ,
towards the partial fulfilment for the study of BBA in year 2022-2023 is original
work done by me, which is based on Primary and Secondary data and it is based on
the knowledge and material gained from the company.

The contents provided are true to the best of my knowledge and belief.

I further declare that, this project report has not been submitted to any other
College or University for any other degree or course earlier.

Place: Alandi (D), Pune,

Date:27 JAN 2023

Name of the Student : Sohan Gaikwad

SYBBA -C
6

INDEX

Chapter No. Name Of The Chapter Page No.

1. Introduction And Research Methodology

1.1 Introduction Of Project
1.2 Scope Of The Study
1.3 Significance Of The Study
1.4 Research Methodology

1.8 Limitations Of The Study

2. Literature Review
2.1 Theoretical Background
2.2 Literature Review
3. Company Profile
3.1 Name, Address And Location Of The Company
3.2 Company Profile
4. Survey Analysis And Interpretation
4.1 Data Analysis And Interpretation
5. Findings
5.1 Findings
6 Suggestions and Conclusion
6.1 Suggestions
6.2 Conclusion
References ( Bibliography)
Annexure
7

Table Name Of The Table Page

No No

1.1 List of Private Sector Banks

2.1 Age of Candidates (Respondents) ?

2.2 What Type of bank account you use ?
2.3 What type of investment strategy do you like ?
2.4 What are the different ways to operate your
accounts
2.5 Do you have any type of loan service availed at
this moment ?
2.6 How would you rate the quality of banking
services you currently use?
2.7 What type of investment strategy do you like ?

2.8 Do you Avail Debit /Credit Card ?

2.9 Do you avail Online / Net banking features ?

2.10 Are you satisfied by the service provided by

the bank
3.1 Pavana Sahakari Bank Ltd Interest rates on
loans

3.2 Top 10 Best Private Banks in India 2022

8

LIST OF GRAPHS

Graph Name Of The Chart Page

No No

2.1 Age of Candidates (Respondents) ?

2.2 What Type of bank account you use ?

2.3 What type of investment strategy do you like ?

2.4 What are the different ways to operate your

accounts
2.5 Do you have any type of loan service availed
at this moment ?

2.6 How would you rate the quality of banking

services you currently use?

2.7 What type of investment strategy do you like ?

2.8 Do you Avail Debit /Credit Card ?

2.9 Do you avail Online / Net banking features ?

2.10 Are you satisfied by the service provided by

the bank
9

Chapter I – Introduction And

Research Methodology
10

ABSTRACT

Banking Sector plays an important role in economic development of a country. The banking
system of India is featured by a large network of bank branches, serving many kinds of
financial needs of the people. Co-operative and commercial bank plays a major role in
providing credit facilities to the people in India. The present study is comparing the Financial
performance of commercial and co-operative banks by calculating their income and
expenditure, loans and deposits, etc., the analysis is made through calculating ratios like
Leverage ratio, Cash inflow indicators ratio, Debt coverage ratio. The study is beneficial to
determine the current status and financial performance of both commercial and co-operative
banks for the last five years

1. Introduction

There is no unanimity among the economists about the origin of the word ‘Bank’. According
to some authors, the word ‘bank’ is derived from the French word ‘bancus’ or ‘banque’
which means a ‘bench’. Banking is as old as is the authentic history and origins of modern
commercial banking are traceable in ancient time. The New Testament mentions about the
activities of the money changers in the temples of Jerusalem. In ancient Greece, around 2000
B.C., the famous temples of Ephesus, Delphi and Olympia were used as depositories of
surplus funds of citizens and these temples were the centres of money-lending transactions.
The priests of these great temples acted as financial agents until public confidence was
destroyed by the spread of disbelief in the religion. Traces of credit by compensation and by
transfer orders are found in Assyria, Phoenicia and Egypt before the system attained full
development in Greece and Rome. In India, the Banking Regulation Act, 1949 defines bank
as a banking company and a banking company is a company which transact the business of
banking in India [Section 5(c)]. Section 5(b) defines banking as accepting, for the purpose of
lending or investment, of deposits of money from the public, repayable on demand or
otherwise and withdraw-able by cheque, draft, and order or otherwise.
11

Banking Sector In India:

Co-Operative Bank :

A cooperative bank is a financial institution that is run by its members. These members are
at once both the owners and the customers of the bank, by virtue of holding shares in the
bank and/or having deposits with them. Cooperative banks are based on the principles of
the first labour cooperatives that saw people in the same trade, with the same goals,
banding together to protect their common interests.
12

Private sector banks -- also known as commercial or stockholder banks – are run by a
private individual or group for the purposes of making a profit for the owners and the
shareholders.

Services

The two types of bank differ in the scope of the services they offer. Cooperative banks
typically lend money to small businesses and individuals; commercial banks -- as they tend
to have larger deposits to draw on -- will also lend to large industry and commerce.
Commercial banks also offer merchant banking services such as facilitating a company
floating on the stock market; cooperative banks do not. Cooperative banks tend to offer
better rates of interest to savers than commercial banks. Cooperative banks have a limited
scale of operation, typically contained within a state; many commercial banks operate
nationwide and some have branches overseas. Commercial banks trade in foreign
currencies, a practice that cooperatives do not engage in.

Private Sector Banks :

Private sector banks are those in which private individuals or private corporations own a
significant portion of the bank's equity. Even though these banks adhere to the guidelines of
the country's central bank, they are free to develop their financial strategies for their
customers. A significant portion of these banks' shares are traded on the stock market, and
anyone can purchase a significant portion of these banks' shares on the stock market.
13
14

Objective of the study :

 The main objective of the study is to analyse the services offered by Private banks &
Co operative Banks .

 To study peoples preferences towards services offered by banks .

 To examine the profile and functions of selected private banks and co- operative
banks.

 To analyse the loans, deposits, interest etc., of selected private, and co-operative
banks.

Scope of Study: The study examines the parameters which new generation private sector
banks have influence on public sector banks. Emphasis has been placed on exploring and
identifying the underlined issue.

The study focuses on respondents approach towards various services offered by Private
Banks and Cooperative banks .
15

Research Methodology:

This study is limited at certain extent. It is more of cross sectional study in terms of services
offered by banks (co-operative bank, private bank & foreign banks ). Also the case is limited
by the no of banks and no of primary survey (google form entries ) taken for study. The
findings are
A) Services offered by private banks, foreign banks & co- operative banks .
B) Functions of banks and their limitations.

Primary Data:

I. Data collected Google forms. Basic data entry of people using different banking
services in different banking institutions.

Secondary Data:

i. Data collected from bank visits of Suvannayug Sahakari Bank Pvt.Ltd,

Pavana Sahakari Bank Ltd.
ii. Information collected from reference books like Indian banking by S.
Natarajan & Dr.. Parameswaran, International Banking : Legal &
Regulatory Aspects by Indian Institute of Banking & Finance .
iii. References from popular case studies of Dr. Krishna Sudheer.
iv. From International journal of Applied Research 2016; 2(5): 643-649 by
Seyed Mehdi

Limitation Of The Study :

• This subject is based on past data of Banks’

• The analysis is based on structural liquidity statement and gap analysis.
• The study is mainly based on secondary data.
16

• Approximate results: The results are approximated, as no accurate data is Available.

Chapter II- Review of Literature

17

Seyed Mehdi pourkiaei, Dr. S Mahendra Kumar : These research showed a

comparison between the three types of banks i.e , private ,co-operative and foreign
Bank .It included the Narasimham committee study work both in the year 1991 and April
1998 .

Phase I: Narasimham Committee (1991) :

Deregulation of the interest rate structure. - Progressive reduction in pre-emptive reserves. -
Liberalisation of the branch expansion policy. - Introduction of prudential norms. - Decline
the emphasis laid on directed credit and phasing out the confessional rate of interest to
priority sector. - Deregulation of the entry norms for private sector banks and foreign banks. -
Permitting public and private sector banks to access the capital market. - Setting up to asset
reconstruction fund. - Constituting the special debt recovery tribunals. - Freedom to appoint
chief executive and officers of the banks. - Changes in the institutions of the board. -
Bringing NBFC, under the ambit of regulatory framework

Phase II: Narasimham Committee II (April 1998) :

i. Capital Adequacy: Minimum capital to risk asset ratio be increased from the existing 8
percent to 10 percent by 2002. - 100 percent of fixed income portfolio marked to market by
2001. - 5 percent market risk weight for fixed income securities and open foreign exchange
position limits. - Commercial risk weight
(100%) to government guaranteed.

II. Misra and Aspal (2013) , Performance Analysis of Indian Banks – A

comparative study of Commercial Bank and Urban Cooperative
Bank

Misra and Aspal studied the performance and financial soundness of State bank
group comprising of State bank of India, State bank of Hyderabad, State bank of
18

Patiala, State bank of Mysore, State bank of Bikaner and Jaipur and State bank of
Travancore for three years i.efrom 2009-2011

III. Kumar (2006) he studied the bank nationalization in India marked a paradigm shift
in the focus ofbanking as it was deliberated to shift the focus from class banking to
mass banking. Internationally also efforts are being to study causes of financial
inclusion of low-income group treating it both a business opportunity as well as a
corporate social responsibility.

IV. Singla(2008) examines that how financial management plays an important role
industrialist growthof public and private banking. It is concerning and examined the
profitability position of selected sixteen banks of banker index for a period of six
years (2001-2006) the study reveals that the profitability situation was reasonable
during the period of study when compared and the previous year. Banks in a better
position to deal and absorb the economic constant over a period of time.

V. Prashanta Athma (2000), in his Ph.D. research submitted at Osmania University

Hyderabad, “Performance of Public Sector Banks – A Case Study of State Bank of
Hyderabad, made an attempt to evaluate the performance of Public Sector
Commercial Banks with special emphasis on State Bank of Hyderabad. The period of
the study for assessment of performance is from 1980 to 1993-94, a little more than a
decade.

VI. V.N. Saxena(1978), analyzed that "Improvement in the systems and procedures of
inspection of stocks, maintenance of stock register is required. Reforms should be
initiated in the extension of sponsorship schemes, recovery, and consultancy". This
can be supporting tools for banks.

VII. Mumupilly (1980), examined the cost and profitability of commercial banks in
India. The study provides an analytical view of the trends in the components of cost of
earnings of different groups of Indians commercial banks since nationalization. The
 19

study mainly focuses on the cost and profitability of banking industry as whole rather
than individual banks.

VIII. Gupta and Verma (2008), have Studied the improve paradigm in Indian
banking and revealed that banking sector has been serving the crucial needs of the
society even after undergoing various changes. With the passage of time, the
wonderful resilience and adaptability of the banking sector to the changing needs of
the society seem to have reached the threshold of the revolutionary era. „Anywhere
and anytime banking‟,„Telebanking‟, „Internet Banking‟, „Web Banking,‟ E-
Banking‟, ‟E-Commerce‟, „E-business‟ are all innovative offerings to their cu
20

Chapter III – Company Profile

21

Co-Operative Banks :

Co-operative Banks – Historical Perspective:

The introduction of Co-operative Banks in India dates back to the early 20th century, which
was a time of distress for the Indian society.

A timeline as to how the co-operative banking emerged in India has been given below:

 The Cooperative Credit Societies Act, 1904, was the first step taken for the co-
operative society, which got accelerated with the introduction of the Cooperative
Societies Act of 1912

 In post-independent India, Central Committee for Cooperative Training (1953) was

set up by RBI for establishing co-operative training centres

 To solve the issue of the financial crisis in the rural areas, Rural Credit Survey
Committee was set up 1954

 This co-operative movement spread through the banking sector as well and by 1950s,
Co-operative Banks had started extending their reach to the public in both rural and
urban areas

A co-operative bank is a small-sized, financial entity, where its members are the owners and
customers of the Bank. They are regulated by the Reserve Bank of India (RBI) and are
registered under the States Cooperative Societies Act.

The Co-operative Banks have recently been in news after RBI’s restrictions on one of the
leading banks, where they were denied any kind of money withdrawal. This incident of the
Punjab and Maharashtra Co-operative Bank (PMC) has raised questions over the reliability of
such financial entities.
22

In this article, we shall discuss the history, structure, benefits, and disadvantages of Co-
operative Banks in India. To know more about the different Types of Bank in India, visit the
linked article. Co-operative Banking has proved to be an asset in terms of acting as a financial
intermediary to agricultural and allied activities, small scale industries, and self employed workers.

Co-operative Banking in India :

The Co-operative Banks in India are governed as per the Banking Regulations Act 1949
and Banking Laws (Co-operative Societies) Act, 1955.

These Banks have been opened with the motto of ‘no-profit-no-loss’ and thus, do not seek for
profitable ventures and customers only. As the name suggests, the main objective of Co-
operative Banks is mutual help.

Given below are a few important features of Co-operative Banking in India:

 They work on the principle of ‘one person, one vote’. Since these banks are owned by
the members, a Board of Directors is chosen democratically and then they are
responsible for controlling the Organisation

 Farmers can avail agricultural loans on minimum interest rates from the Co-operative
Banks

 Providing easy and accessible loans and credit benefits in the rural areas with scarce
banking facilities

 The annual profit earned is spent on financial reserves and required resources and a
part of it is distributed among the Co-operative members, as per the prescribed
limitations

These institutions play a critical role in last-mile credit delivery and in extending financial
services across the length and breadth of the country through their geographic and
demographic outreach
23

Structure of Co-operative Banks :

The structure of a Co-operative Bank is given in the image below:

The image below is as per the annual report released by the Reserve Bank of India in March
2019. Of the total number of Cooperative Banks in India, they can be divided into two types,
which can further be subdivided:

 Urban Co-operative Banks

o Non-Scheduled UCBs

o Scheduled UCBs

 Rural Co-operative Banks

24

o State Cooperative Banks

o District Central Cooperative Banks

o Primary Agricultural Credit Societies

Single-state UCBs are regulated by State Registrars of Co-operative Societies (RCS) and
multi-state UCBs are governed by Central Registrar of Co-operative Societies (CRCS).

To know the important responsibilities that the Indian Banking sector possesses, visit
the Functions of Banks page.

Major Players In The Indian Banking Industry :

Public Sector Banks (SBI and associates + Nationalised banks) control more than 74-75% of
the total credit and deposits businesses in India whereas Private Sector Banks around 17-
18%.
25

Advantages of Co-operative Banks

The Co-operative banks have acted as a boon to various sectors of Indian society and also
played an important role in the development of the economy.

Given below are a few advantages of the Co-operative Banks in India:

 These banks have provided aid to the rural population by granting loans and credits
with interest rates, lower in comparison to that asked by local money lenders

 They have their reach at every corner of the country and have managed to maintain a
personal rapport with the customers

 Since the bank is owned and governed by the members themselves, they do not seek
huge profits and believe in mutual help

 The interest rate on deposits is high and on loans is low

 They promote productive borrowing, in order to reduce the risk of loss

 Co-operative Banks have helped the farmers by providing them agricultural credits to
buy basic products like fertilizer, seeds, etc.

Disadvantages of Co-operative Banks

Discussed below are a few disadvantages of the Co-operative Banks in India:

 To lend money, they need investors which are tough to find

 Over the years, the number of NPAs and over-dues have been increasing

 Since the lack of investors and money, few of them have not been delivering the
credits and money to the rural population

 Rather than small industrialists, the benefits from Co-operative Banks have been
enjoyed by rich landowners

 The Co-operative Banks across the country are not equally developed. A few states
have more functioning and beneficial units, while some states have faced loss

 Political interference has also been observed in these bank

 With new types of banks opening up, the Co-operative Banks are facing the risk of
losing their customers
26

Private Sector Bank :

Private Banks-Historical Perspective :

Over the years, the Indian banking system has evolved to attain excellence and transparency
in providing financial services to customers. It holds the financial conditions of various social
classes of the country.

Public and private banks in India are coming with more flexibility in terms of their offerings
and schemes. But private banks have come in a better position to be people’s best choices.
Private banks in India are better in terms of operational efficiency and innovation level. They
are profit-driven, due to which they provide a better service level.

Private banks were recognised in the 1990s after the LPG policy came into existence.
Amongst the oldest and most famous private banks, Axis Bank and IndusInd Bank are
regarded as the oldest private banks in India started in 1993-94 when the government allowed
them to launch such banks.
27

What are Private Sector Banks ?

 Private Sector Banks are the banks in which private individuals own and maintain the
majority of the shares or equity.
 Initially, public sector banks dominated the Indian banking sector, but after the 1990s,
private sector banks emerged and expanded rapidly.
 Their rapid growth was due to their use of cutting-edge technology, new financial
tools, and cutting-edge innovations.
 In India, private sector banks are divided into two types.

 Old Private Sector Banks (emerged before 1968)

 New Private Sector Banks (emerged after the 1990s)

 Old Private Sector Banks are those private sector banks that existed at the time of
nationalisation.
 The Reserve Bank of India issued guidelines for the establishment of new private
sector banks in India in 1993.
 The majority of a bank's share capital is held by private individuals. These banks are
set up as limited-liability corporations.
 Currently, there are 21 private sector banks in India.

Table 1.1

List of Private Sector Banks

Axis Bank IndusInd Bank
Bandhan Bank Jammu and Kashmir Bank
City Union Bank Karnataka Bank
Dhanlaxmi Bank Kotak Mahindra Bank
DCB Bank Karur Vysya Bank
Federal Bank Lakshmi Vilas Bank
HDFC Bank Nainital Bank
28

ICICI Bank RBL Bank

IDFC Bank South Indian Bank
IDBI Bank Tamilnad Mercantile Bank
YES Bank

Private Sector Banks – Advantages

 Customers are offered quick service by private sector banks.

 These banks also provide tailored services based on the customer's financial
requirements.
 Banks in the private sector have a streamlined management system.
 Private sector banks can make quick financial decisions.

Disadvantages
Private Sector Banks – Disadvantages

 Private sector banks charge additional fees for all financial services.
 These banks only operate in cities, making them inaccessible to the rural population.
 Employees in private sector banks have no job security.

Conclusion :

 Private Sector Banks are solely owned by major public shareholders, who tend to take
the entire profit that the Private Sector Banks make.
 These private sector banks are more focused on meeting the needs of their customers
than government-owned public banks.
 Private sector banks also offer additional services to attract customers and persuade
them to invest
29

Chapter IV – Survey Analysis And

Interpretation
30

Age of Candidates (Respondents) ?

Table 2.1

Age of Candidate Above 18 & below 40 Above 40

Number of Candidate 43 09

Chart 2.1

Age Group
17%

83%

Above 18 & Below 40 Above 40

Analysis : The table 2.1 & Chart 2.1 shows us the majority of people that are being survey
for the study lie between the Age group Above 18 & Below 40 .This number stands with a
majority 0f 82.4 % as compared Above 40 age group with 17.6 %

Interpretation : The study tells us that the majority if the people in the survey are working
population form the age group ranging from 18 to 40 years of age .
31

What Type of bank account you use ?

Table 2.2

Type of bank account Number of Candidates

Current A/C 11

Savings A/C 40

Chart 2.2

Count of Type of bank account ?

45
40
40
35
30
25 Total
20
15
11
10
5
0
Current A/C Savings A/C

Analysis : The Survey in Table 2.2 & Chart 2.2 shows that 40 respondents use Savings
Account while the remaining 11 respondents use Current Account services.

Interpretation: Here the maximum number of respondents generally prefer a Savings

A/C as compared to Current A/C . Current Accounts are generally given by banks to
customers who are favourable to the banks as charges are being applied to Current
Account holders for their transactions.
32

What type of investment strategy do you like ?

Table 2.3
What type of investment strategy do you like? Current A/C Savings A/C

Fixed Deposit 3 8

Mutual Funds 2 4

None of the above 1 0

Recurring Deposit 0 1

Savings A/C 1 19

Stocks 4 8

Chart 2.3

Count of Name by What type of investment strategy do you

like ? and Type of bank account ?

Stocks

Savings A/C
Savings A/C
Recurring Deposit Current A/C

None of the above

Mutual Funds

Fixed Deposit

0 2 4 6 8 10 12 14 16 18 20

Analysis : The data given is table2.3 & chart 2.3shows the different investment strategies
people prefer to invest their money in .Here the people like to invest in Savings A/C with the
highest preference followed by Stocks , the Fixed deposit facility provided by the banks.

Interpretation : Analysis : The given data shows us that people mostly like to invest their
money in Savings A/C as it’s the most convenient as safe . Followed by Stocks and FD.
While RD was given the least preference .
33

What are the different ways to operate your accounts ?

Table 2.4
What are the different ways you use to operate your accounts ? Number of Candidate ?

ATM (Automated Teller Machine ) 40

Internet Banking 26

Telephone or mobile banking 30

Branch or over the counter service 11

Chart 2.4

Analysis : The table 2.4 and char t 2.4 shows us how the respondents like to access their
banks= accounts . The highest preference was given to ATM with 78.9% followed by
Internet
Banking with 51 % while telephone banking and branch banking were least preferred .

Interpretation : The maximum respondents prefer ATM services as they are most reliable
and safe followed by Internet Banking as its growing in technology and convenience .This
shows that people don’t prefer to visit the Branch for their banking purpose .
34

Do you have any type of loan service availed at this moment ?

Table 2.5
Do you have any type of loan service availed at this Number of
moment ? Candidates
Unsecured Personal Loan 01
Secured Personal Loan 05
Auto loans 01
Mortgage Loans 02
Small Business Loans 03
Other loans 02
None 37

Chart 2.5

Analysis :The data in the table 2.5 and chart & show us what type of loan services are
preferred by the normal people . Here the maximum number of people have not availed any
loans with 72.5%. Secured loans with 9.8% and mortgage loans with 4.3 % .

Interpretation : The surveys shows that people prefer secured loan facility followed by
mortgage loans while the most were with no loans opted .
35

How would you rate the quality of banking services you currently use?

Table 2.6
How would you rate the quality of banking services you Number of
currently use? Candidates ?
1 02
2 04
3 14
4 16
5 15

Chart 2.6

Analysis : The above data shows the quality of banking provided by Private as well as Co
operative Banks . Here the satisfaction stood high at 4 star rating with 32.4% followed by 5
star rating with 29.4% and 3 star rating with 27.5%.

Interpretation : The data given in table 2.6 and chart 2.6 % tells that most peopleare
satisfied by the services offered by their banking institution. As most of them rated between
3-5 star rating .
36

What type of investment strategy do you like ?

Table 2.7

What type of investment strategy do you like ? Number of Candidates

Savings A/C 20
Stocks 12

Fixed Deposits 11

Mutual Funds 06

Recurring Deposits 01

None of the Above 01

Chart 2.7

Analysis : The data showed in the table 2.7 and chart 2.7 shows us that people have different
investment preferences .The savings accounts was voted the most with 39.2% followed by
stocks with 23.5% followed By fixed deposits with 21.6%.

Interpretation :The study shows that the least preferred type of investment were the
Recurring deposits wit less that 2% . While the most favoured investment were the Savings
A/C .
37

Do you Avail Debit /Credit Card ?

Table 2.8
Do you Avail Debit /Credit Card Number of Candidates ?

Debit Card 36

Credit Card 15

Chart 2.8

Cards Issued

Credit Card
29%

Debit Card
71%

Debit Card Credit Card

Analysis : The table 2.8 and chart 2.8 shows us that 71 % respondents use Debit Card while
Credit Card is used by 29% out of the 51 Respondents.

Interpretations : The maximum number of respondents preferred using Debit Cards as

Debit Cards are used due to ease and convenience as Credit Cars are charged interest rates .
38

Do you avail Online / Net banking features ?

Table 2.9
Do you avail Online / Net banking features ? Yes No

Number of Candidates 40 11

Chart 2.9

Users of Online Services

0 5 10 15 20 25 30 35 40 45

No Yes

Analysis : Here the given above in the table 2.9 and chart show out of 51 Respondents 40 use
Net banking and Online services provided by their banks .The X-axis denotes the number of
respondents . The orange bar denotes “No” while Blue denotes “Yes”.

Interpretation : The data above interprets that mostly the respondents are keen to use online
banking services . As the technology is developing the use technology in banking is also
increasing .
39

.
Are you satisfied by the service provided by the bank ?

Table 2.10
Are you satisfied by the service provided Number of Candidates
by the bank ?
Yes 45
No 06

Chart 2.10

Satisfaction Rate

12%

Yes
No

88%

Analysis : The data shows us that the maximum number of people are satisfied by the
services provided their banks whether be it a Private bank Or a Co operative Bank .The table
2.10 & chart 2.10 shows that the percentage of satisfaction is 88 % .

Interpretation : The above data shows that the maximum number of people are satisfied by
the services provided by their respective banks ( i.e. Private Bank & Cooperative Bank )
40

Services Offered by Co-operative Banks :

The co-operative banks are government backed financial institutions that work on the
principle of co-operation, self-help and mutual help. The co-operative banks are mainly set
up to provide access to credit in rural areas. This empowers and secures the poor and the low
income groups.
Co-operative banks offer basic banking functions and services in rural, urban and semi-urban
areas, where banking facilities are scarce. Unlike commercial banks whose sole purpose is
profit making, co-operative banks help encourage rural business and the agricultural sector
and work towards growth.

Co-operative Banks and Their Role in India The Objective of Co-Operative Banks:
Listed below are some of the key objectives of a co-operative bank:

 Provides credit facilities like rural financing and micro-financing.

 Co-operative banks aim to offer credit to the common man at moderate interest rates,
eliminating the dominance of private money lenders.
 Providing agricultural loans to farmers at low interest rates for the growth of the
agricultural sector and allied activities.
 Providing easy access to credit for rural industries.
 Providing financial services in rural areas where banking facilities are scarce.
 Helping the poor and the low-income groups, access banking facilities and get loans
at low interest rates for cottage industries, agriculture, farming, small businesses and
so on.

Categories of Co-Operative Banks:

The co-operative banks are set up to cater to different types of customers and their credit
requirements. These banks aim to solve the rural credit issues and other financial problems
pertaining to the rural masses. The co-operative banks have empowered people by
strengthening the rural and urban financing sector.

The most crucial contribution of co-operative banks is the role they play in offering rural
financing and micro-financing services to the rural
41

people. The co-operative banks can be categorised into two types based on their function:
 Long-term co-operative credit institutions short-term co-operative credit institutions
 Long-term co-operative credit institutions operate on three levels. They are the state
level, district level and village level.

Short-term co-operative credit institutions can be further divided into the following types:
1. State Co-operative banks
2. District Co-operative banks

Primary agricultural Co-operative banks

Considering the structure of co-operative banking in India, the co-operatives can be

categorised into 5 groups:
Primary agriculture credit society Primary urban co-operative banks District central co-
operative bank State co-operative banks

Land development banks

See Also: Rural Banking in India Functions of Co-Operative Banks:
Primary Urban Co-Operative Banks (PUCBs): These banks offer services in the urban and
semi-urban areas of India. The primary function of these co-operative banks is:
Providing loans to small borrowers and small businesses. Extending credit facilities like term
loans and working capital loans. Giving advances against shares and debentures.

Primary Agriculture Credit Society (PACs): These institutions mainly perform the
following functions:
 Encouraging customers save money through deposits.
 Offering easy loans to customers.
 Extends services for the welfare and development of the masses. Supports and
encourages various rural-based agricultural activities.

District Central Co-Operative Bank (DCCBs): The primary agricultural societies are
affiliated to the district central co-operatives. The main functions of the DCCBs are:
Arranging credit for the PACs and PUBCs. Supervising the banking business of co-
operatives. Regulating and implementing policies.
42

State Co-operative Banks (SBCs): The state co-operative banks serve as the supervisory
authority to the DCCBs. The SBCs are again supervised by NABARD. The SBCs serve as
leaders of the co-operatives in the state.

Land Development Banks (LDBs): The land development banks are a subsidiary unit of the
co-operatives, which mainly offer long-term capital to meet the requirements of the
agricultural sector. The main functions of the LDBs are:

 Provide banking facilities and services to fulfil the needs for development. Providing
secured and unsecured loans.
 To promote agriculture and increase agricultural production in India. Providing easy
credit in rural areas.

Products and Services Offered by Co-Operative Banks:

The main services and products offered by co-operative banks are listed below:
Deposit Facility Similar to Banks: Savings bank accounts, current accounts, recurring deposit
accounts and fixed deposit accounts.
Loan Facilities: Loans for salaried, loans for pensioners, loans to the physically challenged,
housing loans, education loans, property mortgage loans, loans t entrepreneurs under various
government schemes.

Services Offered by Co-Operatives: Clearing facility, ATM facility, safe deposit locker
facility, demand draft and pay order.

 Rural Co-operative Banks

o State Co-operative Banks

o District Central Co-operative Banks

o Primary Agricultural Credit Societies

 Urban Co-operative Banks

43

o Non-Scheduled UCBs

o Scheduled UCBs

The primary goal of a co-operative bank is mutual help. A co-operative bank

extends financial help to the deserving needy at the lowest rate of interest. They
function on a ‘no profit no loss’ policy. Co-operative banks brought in a number of
improvements for the economically weaker section, such as -
 Freedom from the clutches of moneylenders

 Encouragement to save more.

 Better farming practices

 Opportunities for self-employment

Here’s a look at the 10 best performing co-operative banks in India.

1. Saraswat Co-operative Bank

Saraswat Co-operative Bank, formed in 1918, is the topmost co-operative

bank in India. It is present in six states and is headquartered in Mumbai. It
declared a gross profit of Rs 651.69 crore in the financial year ending 31st
March 2020. During the COVID global pandemic, the bank beat all
restrictions imposed and registered growth on all banking parameters.
44

Saraswat Co-operative Bank offers excellent customer support and has very
transparent policies which have helped the bank to shape itself up as one of
the giants of its type in the country. It won the “Best technology bank of the
year” award in 2019.

2. CosmosCo-operativeBank

Cosmos Bank is the first of its kind to open a currency chest, with
permission from the Reserve Bank of India. This bank has produced some of
the best figures in its market capitalisation and profits. These have helped
Cosmos bank consolidate its position as one of the best co-operative banks
and have helped gain the trust of its customers.

3. Shamrao Vithal Co-operative Bank (SVC Bank)

Shamrao Vithal Co-operative Bank is considered a pioneer in India’s co-

operative banking industry with its registration going back to 1906 in
Mumbai. India’s third-largest co-operative bank, Shamrao Vithal Co-
operative Bank’s new corporate identity is SVC Bank.
45

SVC Bank attempts to serve the largest number of people and has a total
business of over Rs.250Billion . The bank has 193 branches across ten
different states of India. The Brihan Mumbai Nagari Sahakari Banks
Association awarded SVC Bank the “Best Urban Co-operative Bank” award
in 2018.

4. Abhyudaya Co-operative Bank Ltd

Abhyudaya Co-operative Bank Ltd is the first bank on the list which started
its operations after India’s independence in 1964. It was started by the
economically weaker section of laborer’s from Kalachowkie, Sewri, and
Parel areas of Mumbai with an initial investment of Rs 5000 and today
boasts revenues in billions.

Abhyudaya Co-operative Bank has 111 branches in Maharashtra, Karnataka,

and Gujarat, with 34 branches offering evening banking services.
Abhyudaya Co-operative bank has kept itself abreast with new-age
technology and has won the “Best IT Enabled Co-operative Bank” award in
2014-15.
46

5. Bharat Co-operative Bank

Bharat Co-operative Bank was founded in 1978 with headquarters in

Mumbai. Even though it is relatively new, the bank has a customer base of
around Rs 5.5 lakhs in Maharashtra, Karnataka, and Gujarat.

Bharat Co-operative Bank has kept up with technology and offers new tech
solutions like mobile apps, various card offers, and others. It was awarded
the “Best Urban Co-operative Bank” award in 2017 and the “Best
Information Technology” award in 2016.

6. TJSB Co-operative Bank

The Thane Janata Sahakari Bank is one of the country’s biggest banks in
terms of the number of people it serves daily. Founded in 1972, today it has
136 branches in 5 states.

The bank has been constantly adapting itself to the latest technologies to
serve customers in the best way possible. It is the first co-operative bank to
47

make UPI live and has some award-winning mobile applications and
payment systems to make transactions and banking easier for the customers.

7. JanataCo-operativeBank

The Janta Co-operative Bank was founded in Malleshwaram, Bengaluru.

Having the names of some prominent names in the country associated with
it, the bank is known as one of the most transparent banks with new goals
set to be accomplished every year. The bank has a reserve of Rs 1,336.61
crore providing shareholders with a constant dividend of 18% for many
years.

The bank has won many awards like, “Best green initiative”, “best ATM
initiative” and “best bank in the deposit category of more than Rs 5000
crores”.
8. Kalupur Commercial Co-operative Bank
48

Kalupur Co-operative Bank started in 1970 in Kalupur, Gujarat, and has

branches in Gujarat and Maharashtra. For some years now, it has been
showing yearly profit increments with the year 2019 showing a working
capital of Rs 8652.34 crore, with a net profit of about Rs 122 crores.

The bank is customer friendly with some unique facilities that it provides. It
is the first co-operative bank in Gujarat to be on RTGS and also the first in
Gujarat to get an authorised dealership.

9. NKGSCo-operativeBank

One of the most dependable banks in the country, NKGSB Co-operative

Bank established in 1917, has 109 branches across five states. The bank has
a set of well-defined goals, values, and principles and works aggressively
towards achieving its goal.

10.The Ahmedabad Mercantile Co-operative Bank

49

The Ahmedabad Mercantile Co-operative Bank Ltd. was established in 1966

and is popularly known as AMCO BANK. It has a group of 34 branches and
focuses on fast and accurate service.

The bank has an authorised capital of Rs 20 crores and a profit of Rs 40.46

crores as of March

Pavana Sahakari Bank Ltd Pune (Surveyed bank )

The PAVANA SAHAKARI BANK LTD PUNE branch of IDBI BANK is located in the
PUNE district of the MAHARASHTRA State at .WP8MWWPLWLPU-48.. The IFSC Code
of the branch is IBKL0087015 and its MICR Code is MICR not provided.
The working hours of the PAVANA SAHAKARI BANK LTD PUNE branch of IDBI BANK
are Monday to Saturday from 10am to 4pm* while the 2nd and the 4th Saturdays generally
remain non-working days. One may call the designated branch office too at its phone number
65272707
50

Table 3.1

Sr. Types of Loan Rate of Interest up Rate of Interest

No. to 25 lac Onwards 25 lac
1 Gold Loan Up to 2,00,000 Lakh 8.00% -
Gold Loan Onwards 2,00,000 Lakh 8.50%

2 Private Car or Commercial Vehicle 9.00% 10.00%

3 Housing Loan For Men 9.00% 9.00%
Housing Loan For Women 8.50% 8.50%
4 Hypothecation Loan 11.00% 12.00%
5 Personal Loan (Unsecured Loan) 14.00 % -
6 Salary Loan 14.00 % -
7 Company Salary Loan (Salary Credit 10.00 % -
in bank account)
8 Mortgage Loan 12.00% 13.00%
9 House Mortgage Loan 9.00% 10.00%
10 Builder Project Loan 14.00% 15.00%
11 Professional Doctor Loan Scheme 9.00% 10.00%
12 Cash Credit Loan 11.00% 11.00%
13 Working Capital Term Loan 11.00% 11.00%
14 Education Loan 10.00% 11.00%
15 FD Loan 1 % Extra on FD -
Interest
16 Rent Discounting Loan 10.00% 11.00%
17 Loan Against Paper Security 13.50% 14.50%
18 Pavana Unnati Loan 9.50% -
19 Pavana MSME Loan 9.50% -
20 Pavana Farm Loan 9.50% -
21 Pavana Pharma Loan 9.00% -
22 Pavana solar Loan 9.00% -
23 Pavana Pragati Loan 9.00% -
24 Pavana Electric Vahan Loan 8.00% 8.00%
51
52

Private Sector Banks : Services offered by private sector banks are more preferable
as compared to any other type of bank .

Top 10 Best Private Banks in India 2022

Table 3.2

Bank Name Total Branches Total ATMs City of Headquarter

HDFC Bank 5,608 16,087 Mumbai

ICICI Bank 5,288 15,158 Mumbai

Axis Bank 4,528 12,044 Mumbai

Kotak Mahindra Bank 1,603 2,573 Mumbai

Yes Bank 1,000+ 1,800 Mumbai

Federal Bank 1,200+ 1,900+ Aluva

IndusInd Bank 1,558 2,453 Pune

RBL Bank 429 412 Mumbai

J&K Bank 1,038 1,340 Srinagar

South Indian Bank 924 1,500 Thrissur

53

1. HDFC Bank - Largest Private Bank in India

Established in the year 1994, Housing Development and Finance Corporation Ltd. is
headquartered in Mumbai. With revenue of a whopping Rs. 1.17 Lakh Crores and a net
income of Rs. 21,078 crores in the year 2019, HDFC is the biggest bank in India and offers
numerous services ranging from Retail to Wholesale Banking, Credit to Debit Cards,
Home Loans to Auto Loans, amongst others, the bank serves millions of customers across
the nation. Today, this international banks in India boast of as many as 5,608 branches,
16,087 ATMs, and generates employment for over 1 Lakh people in the nation.

Bank Products Interest Rates

HDFC Home Loan 8.60%

HDFC Personal Loan 10.50%

Facilities Offered:

Loans: HDFC Bank offers Home Loan, Personal Loan, Loan Against Property, Loan
Against Securities, Education Loan, Pre-owned Car Loan, Two Wheeler Loan, Three
Wheeler Loan, Gold Loan, Loan on Credit Card, Loan Against Car, Business Growth
Loan, and so on.
54

Cards: The bank offers various cards under Credit Cards, Debit Cards, Millennia Cards,
Commercial Credit Cards, Prepaid Cards, and Forex Cards categories.

Accounts: You can open Savings Account, Salary Account, Current Accounts, Rural
Accounts, Sukanya Samridhi Account, Public Provident Fund, and Demat Accounts with
the bank.

Deposits: The bank offers deposit facilities under Fixed Deposit, Recurring Deposit, Non-
Withdrawal Deposits, and My Passion Fund.

Insurance: The bank has many insurance products under Life Insurance, Health &
Accident Insurance, Vehicle Insurance, Travel Insurance, Home Insurance, and Cyber
Insurance categories.

Other Facilities: Apart from the above mentioned, HDFC Bank also offers various other
facilities including Bonds & Securities, Mutual Funds, Safe Deposit Locker, Money
Transfer, Bill Payments, Recharge, NRI Banking facilities, SME Banking facilities,
Wholesale Banking facilities, Agricultural Banking facilities, and so on.

2. ICICI Bank

One of the most reliable of all private banks, ICICI Bank (Industrial Credit and Investment
Corporation of India), offers a wide range of services including truncations, loans,
deposits, privilege banking, insurance policies, and Credit Cards amongst others. With
revenue of Rs 73,913 Crores and a net income of Rs.3,363 Crores in the year 2019,
this top bank of India, boasts of consolidated assets worth Rs. 12.50 trillion. With as many
55

as 5,288 branches and 15,158 ATMs across India, ICICI Bank generates employment for
close to 85,000 people. It is one of the best banks in India.

Bank Products Interest Rates

ICICI Home Loan 8.60%

ICICI Personal Loan 10.50%

Facilities Offered:

Loans: ICICI Bank offers various loan facilities under the categories of Home Loan,
Personal Loan, Car Loan, Loan Against Property, Education Loan, Consumer Finance,
Gold Loan, Loan Against Securities, Commercial Business Loan, Pradhan Mantri Mudra
Yojana, and Stand Up India Scheme.

Cards: The bank offers Credit Cards, Debit Cards, Commercial Cards, Prepaid Cards,
Travel Cards, and Unifare Metro Cards.

Accounts & Deposits: ICICI Bank provides Savings Account, Salary Account, 3-in-1
Account, Pension Account, Defence Salary Account, best NRI account in India , Fixed
Deposit, Recurring Deposit, iWish Flexible RD, and other accounts and deposits facilities.

Insurance: The bank has Life Insurance, Health Insurance, Car Insurance, Travel
Insurance, and General Insurance services.

Other Facilities: Apart from the facilities mentioned above, the bank also offers Tax
solutions, Investments, Agri & Rural finance, My Money, Pockets, and other facilities.q

3. Kotak Mahindra Bank

56

With exceptionally high revenue of Rs. 28,547.24 Crores Kotak Mahindra Bank has
earned the reputation of being a leading private bank in India. Founded in the year 2003,
the bank enjoys as many as 1,603 branches complete with 2,573 ATMs across the nation.
To add to its already illustrious legacy, the bank generates employment for over 33,000
people.

Bank Products Interest Rates

Kotak Home Loan 8.49%
Kotak Personal Loan 10.99%

Facilities Offered:

Loans: Kotak Mahindra Bank offers Home Loan, Home Loan Balance Transfer, Home
Improvement, Personal Loan, Car Loan, Gold Loan, Consumer Finance, Kotak Payday
Loan, Loan Against Security (Kotak Stock Ace), Education Loan, and other lending
products.

Cards: The bank offers Credit Cards, Debit Cards, and Forex/Prepaid Cards.

Accounts: The bank offers Savings Account, Corporate Salary Accounts, Current Account,
Retail Institutional Accounts, Bank+Demat+Trading A/c, and Safe Deposit Locker.

Deposits: Under this category the bank offers Regular Fixed Deposit, Recurring Deposit,
Tax Saving Fixed Deposit, Senior Citizen Fixed Deposit, and Sweep-In Facility.Most

Insurance: The bank has Life Insurance, Atal Pension Yojana, Pradhan Mantri Suraksha
Bima Yojana, and Pradhan Mantri Jeevan Jyoti Bima Yojana.

Other Facilities: The bank also offers Investments, Payments, and NRI Banking services.
57

4. Yes Bank

Headquartered in Mumbai, Yes Bank was established in the year 2004, with the objective
of offering asset management services and retail banking functions, along with investment
banking, corporate finance, branch banking, and SME banking facilities. One of the
fastest-growing private banks of the nation, Yes Bank, enjoyed a revenue of Rs. 25,419
crores in the year 2019. The bank boasts of 1,000 branches across the country,
complemented by 1,800 ATMs. It generates employment for over 18,000 people. It was
among the first banks in India to offer all products digitally and among the best private
banks in India.

Bank Products Interest Rates

Yes Bank Home Loan 8.95%

Yes Bank Personal Loan 10.99%

Facilities Offered:

Loans: Yes Bank offers Home Loan, Yes Khushi Affordable Home Loan, Personal Loan,
Car Loan, Two-Wheeler Loan, Loan Against Securities, Loan Against Property, Business
Loan, Gold Loan, Commercial Loans, MSME Loans, and other loan products.

Cards: Bank offers Credit Cards, Debit Cards, MCTC Card, and Prepaid Cards.

Accounts: Bank offers Savings Account, Salary Accounts, and Current Accounts.
58

Deposits: Yes Bank offers Fixed Deposit and Recurring Deposit facilities.

Insurance: Bank offers Life Insurance, Health Insurance, and General Insurance schemes.

Other Facilities: Bank also offers Wealth Management, YES Privileges, YES Premium ,
Safety Deposit Lockers, Government Schemes, NRI Banking, Business Banking,
Corporate Banking, and Digital Banking services.

5. Federal Bank

Founded in the year 1931 as Travancore Federal Bank, the present-day Federal Bank is
headquartered in Kochi, Kerala. With 1,200+ branches and 1,900+ across the country,
Federal Bank offers multiple services including but not limited to personal banking, retail
banking, corporate banking, NRI banking, insurance, and loans. The bank recorded a
revenue of Rs. 10,911.98 Crores in the year 2018, and generated employment for over
12,000 people.

Federal Bank Home Loan 9.55%

Federal Bank Personal Loan 11.49%

Facilities Offered:
59

Loans: Federal Bank offers Personal Loans, Housing Loans, Car Loans, Gold Loans,
Property Loans, Education Loans, SME Business Loans, Agri Loans, and other loan
products.

Cards: Bank offers Credit Cards, Debit Cards, Contactless Cards, Forex Card, Gift Cards,
and EMI on Debit Card.

Accounts: The bank offers Savings Accounts, Salary Accounts, Noor Personal Account,
RFC Account, and so on.

Deposits: Yes Bank offers Fixed Deposit, Recurring Deposit, Millionaire Deposit, and Tax
Saving Deposit facilities.

Insurance: The bank offers Life Insurance, Health Insurance, Wealth Insurance, and
General Insurance schemes.

Other Facilities: The bank also offers NRI Banking, Business Banking, Online Trading,
Investment, and other services.
60

Chapter V – Findings
61

Findings :

 The survey helps to find peoples preferences towards various facilities

provided by Private as well as Co operative banks.
 Most of the respondents were satisfied by the services provided by their
banks .
 People prefer simple , risk free and convenient ways of investing their
money .
 Private banks and co operative banks provide a wide variety of loan
services to ordinary people.
 Most of the respondents didn’t liked using branch visiting to access their
various banking facilities .
 Most of the respondents used Savings A/C for investing as well keep
their money .
62

Chapter VI – Suggestion and

Conclusion

Policy Suggestions:
63

In conclusion it can be said that though there is-magnificent development in Co –

Operative and Private banks in India after the banking sector reforms .
It may be advised that the Privates well as Co operative sector banks in India should
be more efficient in their overall branch management policy, and should have more
customer- friendly banking operations-to keep pace with the challenging performance
of the private sector banks in India as well as to compete with the global players
which have established their branches in India .
Furtherly its can be noticed that banks services in E banking are preferred more in the
todays advance world so more focus should be de done on E banking services So it is
highly recommended that different sectors of the bank especially private sector banks.
64

Bibliography :

Project Report on Inflation: Meaning, Types and Causes (economicsdiscussion.net)

What Is Private Banking? Definition and How It Works (investopedia.com)

A COMPARATIVE STUDY BETWEEN PRIVATE SECTOR BANKS AND

PUBLIC SECTOR BA… (slideshare.net)

[PDF] A Comparative Study of Banking Services and Customer Satisfaction in Public,

Private and Foreign Banks | Semantic Scholar

(PDF) A Study on Banking Services of New Generation Banking in the Indian

Banking Sector (researchgate.net)

(PDF) Customer Perception on Banking Services -A Study Among Public Sector and Private

Sector Banks (researchgate.net)

Co-operative Banking in India (drishtiias.com)

https://www.bing.com/search?q=co-

operative+bank&qs=OS&pq=co+oper&sk=OS3AS1&sc=6-

7&cvid=B1C62920EA3A48C9B2B0098684158039&FORM=QBRE&sp=5&ghc=1

https://www.bing.com/search?q=co-

operative+bank&qs=OS&pq=co+oper&sk=OS3AS1&sc=6-

7&cvid=B1C62920EA3A48C9B2B0098684158039&FORM=QBRE&sp=5&ghc=1
65

Annexure : The primary information was collected through Google forms .

Google forms link : https://forms.gle/Q8vkEP2qeuWjPpUTA
For the purpose of the survey we visited some of the Co operative banks nearby .

Meeting with Pavana Sahakari

bank manager ; talking about
various provided by the bank
to their customers .
66

Securities and Excha

Board of India
SEBI Bhavan, Head Office of Securities and Exchange Board
of India in Mumbai
67

The •
Securities and Exchange Board of Ind
ai (SEBI)
– Regulator of the financial markets
in India that was established on
12th April 1988.
• This regulatory authority plays an
important role in regulating the
securities market of India
.
• At the end of the 1970s and during
the 1980s, capital markets were

Introduction
emerging as the new sensation
among the individuals of India. Many
malpractices started taking place
such as unofficial self-styled
merchant bankers, unofficial private
placements, rigging of prices, non-
adherence of provisions of the
Companies Act, violation of rules and
regulations of stock exchanges, delay
in delivery of shares, price rigging,
etc.

• Due to these malpractices, people

started losing confidence in the stock
market. The government felt a
sudden need to set up an authority
to regulate the working and reduce
these malpractices. As a result, the
Government came up with the
establishment of SEBI
.
68

 Objectives of
SEBI
1.Protection to the investors
The primary objective of SEBI is to protect the
interest of people in the stock market and provide a
healthy environment for them.

2.Prevention of malpractices
This was the reason why SEBI was formed. Among
the main objectives, preventing malpractices is one
of them

3.Fair and proper

functioning
SEBI is responsible for the orderly functioning of
the capital markets and keeps a close check over the
activities of the financial intermediaries such as
brokers, sub-brokers, etc.
69

 Organization Structure of SEBI

List of Chairpersons
Name Fro T
m o
Madhabi Puri Buch 1 March 2022 Present
Name Designation
Ajay 10 February 2017 28 February 2022
Madhabi
Tyagi Puri Buch Chairman
U K Sinha 18 February 10 February 2017
S.K Mohanty Whole 2011time
C. B. Bhave member February 2008
18 18 February
M. Damodaran 18 February 2005 2011
18 February 2008
Whole time
Raje
G. N.Prem Kuma
Bajpai - Ashwini Bhati
20 February 2002 member
18 February 2005
r a
D.
AjayR.Set
Mehta Part-time 21 February
membe 1995 20 February 2002
h
S. S. Nadkarni
Rajesh Verm rPart-time17 January
membe 1994 31 January 1995
aG.
M. V.
Rajeshwar Ra rPart-time
24 August
membe 17 January 1994
Ramakrishna
o 1990
rPart-time
V Ravi
Dr. Anshuma
S. A. membe
12 April 23 August
n
Dave r 1988 1990
70

• Madhabi Puri Buch took charge of chairman on 1 March 2022, replacing

Ajay Tyagi, whose term ended on 28 February2022.

Madhabi Puri Buch is the first women chairperson of SEBI.

Current Board Members

Members Positions
Madhabi Puri Buch Chairman
S.K Mohanty Whole time member
Ashwini Bhati Whole time member
aAjay Set Part-time membe
h
Rajesh Verm rPart-time membe
a r
M. Rajeshwar Ra Part-time membe
o r
V Ravi Anshuma Part-time membe
n r
71

This regulatory authority acts as a watchdog for all the capital

market participants and its main purpose is to provide such an
environment for the financial market enthusiasts that facilitate the
efficient and smooth working of the securities market.
SEBI also plays an important role in the
economy.
1. Issuers of securities
These are entities in the corporate field that raise funds from
various sources in the market. This organization makes sure that
they get a healthy and transparent environment for their needs.
 Role of SEBI:
2. Investor
Investors are the ones who keep the markets active. This regulatory
authority is responsible for maintaining an environment that is free
from malpractices to restore the confidence of the general public
who invest their hard-earned money in the markets.

3. Financial Intermediaries
These are the people who act as middlemen between the issuers
and investors. They make the financial transactions smooth and
safe.
72

 Functions of
1.SEBI:
Protective
Functions
As the name suggests, these functions are performed by SEBI to protect the interest
of investors and other financial participants.
It includes-
- Checking price rigging
- Prevent insider trading
- Promote fair practices
- Create awareness among investors
- Prohibit fraudulent and unfair trade practices
2. Regulatory
Functions
These functions are basically performed to keep a check on the functioning of the
business in the financial markets.
These functions include-
- Designing guidelines and code of conduct for the proper functioning of financial
intermediaries and corporate.
-Regulation of takeover of companies
-Conducting inquiries and audit of exchanges
-Registration of brokers, sub-brokers, merchant bankers etc.
-Levying of fees

\
73

3. Development
Functions
This regulatory authority performs
certain development functions also that
include but they are not limited to-
1.Imparting training to intermediaries
2.Promotion of fair trading and
reduction of malpractices
3.Carry out research work
4.Encouraging self-regulating
organization
5s .Buy-sell mutual funds directly from
AMC through a broker
74

Powers
:

For the discharge of its functions

efficiently, SEBI has been vested
with the following powers:
-to approve by−laws of Securities
exchanges.
-to require the Securities exchange
to amend their by−laws.
-inspect the books returns
call for periodical of accounts
fromand

recognized Securities
-inspect the books of accounts of
exchanges.
financial intermediaries.
-compel certain companies to list
their shares in one or more
Securities exchanges.
-registration of Brokers and sub-
brokers.
 75

SEBI
Departments

•SEBI regulates Indian financial market through its 20 departments:

• Commodity Derivatives Market Regulation Department
(CDMRD)
• Corporation Finance Department (CFD)
• )
• Department of Debt and Hybrid Securities (DDHS)
• Enforcement Department – 1 (EFD1)
• Enforcement Department – 2 (EFD2)
• Enquiries and Adjudication Department
(EAD)
• General Services Department (GSD)
• Human Resources Department (HRD)
• Information Technology Department
(ITD)
• Integrated Surveillance Department (ISD)
• Investigations Department (IVD)
• Investment Management Department (IMD)
• Legal Affairs Department
(LAD)
• Market Intermediaries Regulation and Supervision
Department (MIRSD)
• Market Regulation Department (MRD)
• Office of International Affairs
(OIA)
• Office of Investor Assistance and Education
(OIAE)
• Office of the chairman (OCH)
• Regional offices (ROs)
 76

 Mutual Funds and

SEBI:
Mutual funds
are managed by Asset Management Companies (AMC), which have to be approved by SEBI.

A Custodian registered with SEBI holds the securities of various schemes of the fund. The trustees of the
AMC monitor the performance of the mutual fund and ensure that it works in compliance with SEBI
Regulations.

Recently, a self-regulation agency for mutual funds has been set up called the Association of Mutual Funds of
India (AMFI). AMFI focuses on developing the Indian mutual fund industry in a professional and ethical
manner
.
AMFI aims to enhance the operational standards in all areas with a view to protect and promote mutual funds
and their stakeholders.
 77
New SEBI Guidelines Effective from 1st September 2021

Stock Exchange Board of India has announced that from September 1, 2021, there will a tectonic shift in
India’s stock market i.e. the new intra-day trading margin rules of the Securities and Exchange Board of
India started with full force.
In 2020, Sebi introduced the new margin rules for day traders under which it was necessary for the
stockbrokers to collect minimum margins on leverage-based trade upfront as against the earlier practice of
collecting it at the end of the
day.
The main objective of SEBI in this whole exercise of peak margin system was for reducing speculation in
the market so that retail investors do not end up incurring losses in volatile markets. The protests made by
bodies like ANMI are that the volumes will reduce in the intraday market, but we did not see that when the
rules became
effective.
From the trader’s perspective, they should be prepared for paying up margins upfront for any position in
the market. For the brokers, this will surely reduce the risk of open positions as they would be covered by
margins for peak
risk.
Also, the shares bought today cannot be sold tomorrow and the funds from today cannot be used
tomorrow.
Phases Effective from % of Peak Margins
Phase 1 December 2020 25% of Peak
Margins
Phase 2 March 2021 50% of Peak
Margins
Phase 3 June 2021 75% of Peak
Margins
Phase 4 September 2021 100% of Peak
Margins
78

Conclusion-
•The stock market is one of the most important indicators of a country’s economic health. The foremost job of a regulator is to safeguard
investor’s interests and make sure that there aren’t any malpractices happening in the trade and investors aren’t
cheated.
•After SEBI came to power in 1982, stock market affairs started becoming healthier and more transparent. Although unfair activities do
happen in the Indian capital market even today, their frequency is quite
low.
79

 Bibilography
 https://en.wikipedia.org/wiki/
aSecurities_and_Exchange_Board_of_Indi
 http://
www.sebi.gov.in/
80

A
Report

On

“ Mastering Global Financial Markets”

By
Mr. Sohan Gaikwad

Class: SYBBA
(Specialisation: Financial Management)

Under the guidance of

Dr. Amol Mane In Partial Fulfilment of
Bachelor’s Degree in business administration

Submitted To

Alandi (D), Pune

Affiliated to

Savitribai Phule Pune University

Academic Year 2022-2023

81

About this course

Global Macro. Stocks. Bonds. FX. It's all here.

By the numbers
Languages: English
Lectures: 36
Video: 3.5 total hours

Certificates
Get Udemy certificate by completing entire course
Udemy certificate

Description
In four short hours we will break down fundamental concepts in understanding global
macroeconomics, stocks, bonds, and foreign exchange markets. Our goal is to
demystify complicated concepts, explain how traders, central banks, and other market
participants make their decisions, and provide a primer through which you can read
and understand the financial and business press with clarity and insight.

What I learned

 Global Finance
 Financial Markets
 Stocks
 Bonds
 Foreign Exchange (FX)
 Macroeconomics
 Reading the business news

Objectives :

 To learn how global financial markets work

 To better understand the business and economics press
 To grasp why market participants (governments, central banks, traders) make
the decisions they do
 Learn about how stocks, bonds, foreign exchange and the global
macroeconomic environment interact

Instructor

Global Investments Institute

Be an Expert in Global Finance
Hello and welcome to the Global Investment Institute. Our fun and engaging market-
oriented training will help you develop a broad range of skills in financial markets.
Our approach is very much practice based, with an expert curriculum vetted by
investment professionals with years of trading on Wall Street managing multi-billion-
dollar portfolios.
82

SECTION 1 : Global Monetary Policy

What is Monetary Policy?

Monetary policy is an economic policy that manages the size and growth rate of the money
supply in an economy. It is a powerful tool to regulate macroeconomic variables such
as inflation and unemployment.
These policies are implemented through different tools, including the adjustment of
the interest rates, purchase or sale of government securities, and changing the amount of cash
circulating in the economy. The central bank or a similar regulatory organization is
responsible for formulating these policies.

Objectives of Monetary Policy

The primary objectives of monetary policies are the management of inflation or
unemployment and maintenance of currency exchange rates.
1. Inflation
Monetary policies can target inflation levels. A low level of inflation is considered to be
healthy for the economy. If inflation is high, a contractionary policy can address this issue.
2. Unemployment
Monetary policies can influence the level of unemployment in the economy. For example, an
expansionary monetary policy generally decreases unemployment because the higher money
supply stimulates business activities that lead to the expansion of the job market.
3. Currency exchange rates
Using its fiscal authority, a central bank can regulate the exchange rates between domestic
and foreign currencies. For example, the central bank may increase the money supply by
issuing more currency. In such a case, the domestic currency becomes cheaper relative to its
foreign counterparts.
Tools of Monetary Policy
Central banks use various tools to implement monetary policies. The widely utilized policy
tools include:
1. Interest rate adjustment
A central bank can influence interest rates by changing the discount rate. The discount rate
(base rate) is an interest rate charged by a central bank to banks for short-term loans. For
example, if a central bank increases the discount rate, the cost of borrowing for the banks
increases. Subsequently, the banks will increase the interest rate they charge their customers.
83

Thus, the cost of borrowing in the economy will increase, and the money supply will
decrease.
2. Change reserve requirements
Central banks usually set up the minimum amount of reserves that must be held by a
commercial bank. By changing the required amount, the central bank can influence the
money supply in the economy. If monetary authorities increase the required reserve amount,
commercial banks find less money available to lend to their clients, and thus, money supply
decreases.
Commercial banks can’t use the reserves to make loans or fund investments into new
businesses. Since it constitutes a lost opportunity for the commercial banks, central banks pay
them interest on the reserves. The interest is known as IOR or IORR (interest on reserves or
interest on required reserves).
3. Open market operations
The central bank can either purchase or sell securities issued by the government to affect the
money supply. For example, central banks can purchase government bonds. As a result,
banks will obtain more money to increase the lending and money supply in the economy.
 Expansionary vs. Contractionary Monetary Policy
Depending on its objectives, monetary policies can be expansionary or contractionary.
Expansionary Monetary Policy :
This is a monetary policy that aims to increase the money supply in the economy by
decreasing interest rates, purchasing government securities by central banks, and lowering the
reserve requirements for banks. An expansionary policy lowers unemployment and stimulates
business activities and consumer spending. The overall goal of the expansionary monetary
policy is to fuel economic growth. However, it can also possibly lead to higher inflation.
Contractionary Monetary Policy:
The goal of a contractionary monetary policy is to decrease the money supply in the
economy. It can be achieved by raising interest rates, selling government bonds, and
increasing the reserve requirements for banks. The contractionary policy is utilized when the
government wants to control inflation levels.
84

SECTION 2 : Currencies And Global Foreign Exchange (FX) Markets

What Is the Foreign Exchange Market?
The foreign exchange market (also known as forex, FX, or the currencies market) is an over-
the-counter (OTC) global marketplace that determines the exchange rate for currencies
around the world. Participants in these markets can buy, sell, exchange, and speculate on the
relative exchange rates of various currency pairs.
Foreign exchange markets are made up of banks, forex dealers, commercial
companies, central banks, investment management firms, hedge funds, retail forex dealers,
and investors.
KEY TAKEAWAYS
The foreign exchange market is an over-the-counter (OTC) marketplace that determines the
exchange rate for global currencies.
It is, by far, the largest financial market in the world and is comprised of a global network of
financial canters that transact 24 hours a day, closing only on the weekends.
Currencies are always traded in pairs, so the "value" of one of the currencies in that pair is
relative to the value of the other.
The foreign exchange market—also called forex, FX, or currency market—was one of the
original financial markets formed to bring structure to the burgeoning global economy. In
terms of trading volume, it is, by far, the largest financial market in the world. Aside from
providing a venue for the buying, selling, exchanging, and speculation of currencies, the
forex market also enables currency conversion for international trade settlements and
investments.

Forex Leverage

The leverage available in FX markets is one of the highest that traders and investors can find
anywhere. Leverage is a loan given to an investor by their broker. With this loan, investors
can increase their trade size, which could translate to greater profitability. A word of
caution, though: losses are also amplified.

For example, investors who have a $1,000 forex market account can trade $100,000 worth of
currency with a margin of 1%. This is referred to as having a 100:1 leverage. Their profit or
loss will be based on the $100,000 notional amount.

Types of Foreign Exchange Markets

There are three main forex markets: the spot forex market, the forward forex market, and the
futures forex market.

Spot Forex Market: The spot market is the immediate exchange of currencies at the current
exchange. On the spot. This makes up a large portion of the total forex market and involves
buyers and sellers from across the entire spectrum of the financial sector, as well as those
individuals exchanging currencies.
85

Forward Forex Market: The forward market involves an agreement between the buyer and
seller to exchange currencies at an agreed-upon price at a set date in the future. No exchange
of actual currencies takes place, just the value. The forward market is often used for
hedging.

Futures Forex Market: The futures market is similar to the forward market, in that there is
an agreed price at an agreed date. The primary difference is that the futures market is
regulated and happens on an exchange. This removes the risk found in other markets.
Futures are also used for hedging.

Advantages and Disadvantages of the Foreign Exchange Market

Advantages

 There are fewer rules than in other markets, which means investors aren't held to the
strict standards or regulations found in other markets.
 There are no clearing houses and no central bodies that oversee the forex market.
 Most investors won't have to pay the traditional fees or commissions that you would
on another market.

Disadvantages

 Though the market being unregulated brings advantages, it also creates risks, as there
is no significant oversight that can ensure risk-free transactions.
 Leverage can help magnify profits but can also lead to high losses. As there are no
set limits on leverage, investors stand to lose a tremendous amount of money if their
trades move in the wrong direction.
86

SECTION 3 :The Bond Market (aka Debt Market)

What Is the Bond Market?

The bond market—often called the debt market, fixed-income market, or credit market—is
the collective name given to all trades and issues of debt securities. Governments typically
issue bonds in order to raise capital to pay down debts or fund infrastructural improvements.

Publicly traded companies issue bonds when they need to finance business expansion
projects or maintain ongoing operations.

KEY TAKEAWAYS

 The bond market broadly describes a marketplace where investors buy debt securities
that are brought to the market by either governmental entities or corporations.
 National governments generally use the proceeds from bonds to finance
infrastructural improvements and pay down debts.
 Companies issue bonds to raise the capital needed to maintain operations, grow their
product lines, or open new locations.
 Bonds are either issued on the primary market, which rolls out new debt, or traded on
the secondary market, in which investors may purchase existing debt via brokers or
other third parties.

Bonds tend to be less volatile and more conservative than stock investments, but they also
have lower expected returns.

Understanding Bond Markets

The bond market is broadly segmented into two different silos: the primary market and the
secondary market. The primary market is frequently referred to as the "new issues" market
in which transactions strictly occur directly between the bond issuers and the bond buyers.
In essence, the primary market yields the creation of brand-new debt securities that have not
previously been offered to the public.

1.In the secondary market, securities that have already been sold in the primary market are
then bought and sold at later dates.

2 Investors can purchase these bonds from a broker, who acts as an intermediary between
the buying and selling parties. These secondary market issues may be packaged in the form
of pension funds, mutual funds, and life insurance policies—among many other product
structures.
87

Types of Bond Markets :

The general bond market can be segmented into the following bond classifications, each
with its own set of attributes.

Corporate Bonds

Companies issue corporate bonds to raise money for a sundry of reasons, such as financing
current operations, expanding product lines, or opening up new manufacturing
facilities.10 Corporate bonds usually describe longer-term debt instruments that provide a
maturity of at least one year.11

Corporate bonds are typically classified as either investment-grade or else high-yield (or
"junk"). This categorization is based on the credit rating assigned to the bond and its issuer.

Government Bonds

National-issued government bonds (or sovereign bonds) entice buyers by paying out the face
value listed on the bond certificate, on the agreed maturity date, while also issuing periodic
interest payments along the way. This characteristic makes government bonds attractive to
conservative investors. Because sovereign debt is backed by a government that can tax its
citizens or print money to cover the payments, these are considered the least risky type of
bonds, in general.

Municipal Bonds

Municipal bonds—commonly abbreviated as "Muni" bonds—are locally issued by states,

cities, special-purpose districts, public utility districts, school districts, publicly owned
airports and seaports, and other government-owned entities that seek to raise cash to fund
various projects

Municipal bonds are commonly tax-free at the federal level and can be tax-exempt at state or
local tax levels too, making them attractive to qualified tax-conscious investors.

Mortgage-Backed Bonds (MBS)

Mortgage-backed security (MBS) issues, which consist of pooled mortgages on real

estate properties, are locked in by the pledge of particular collateralized assets. The investor
who buys a mortgage-backed security is essentially lending money to homebuyers through
their lenders. These typically pay monthly interest

Emerging Market Bonds

These are bonds issued by governments and companies located in emerging market
economies, providing much greater growth opportunities, but also greater risk, than
domestic or developed bond markets.
88

SECTION 4 : The Equity ( Stock ) Market

What Is an Equity Market?

An equity market is a market in which shares of companies are issued and traded, either
through exchanges or over-the-counter markets. Also known as the stock market, it is one of
the most vital areas of a market economy. It gives companies access to capital to grow their
business, and investors a piece of ownership in a company with the potential to realize gains
in their investment based on the company's future performance.

KEY TAKEAWAYS

 Equity markets are meeting points for issuers and buyers of stocks in a market
economy.
 Equity markets are a method for companies to raise capital and investors to own a
piece of a company.
 Stocks can be issued in public markets or private markets. Depending on the type of
issue, the venue for trading changes.
 Most equity markets are stock exchanges that can be found around the world, such as
the New York Stock Exchange and the Tokyo Stock Exchange.

Understanding an Equity Market

Equity markets are the meeting point for buyers and sellers of stocks. The securities traded
in the equity market can either be public stocks, which are those listed on the stock
exchange, or privately traded stocks. Often, private stocks are traded through dealers, which
is the definition of an over-the-counter market.

When companies are born they are private companies, and after a certain time, they go
through an initial public offering (IPO), which is a process that turns them into public
companies traded on a stock exchange. Private stocks operate slightly differently as they are
only offered to employees and certain investors.

Trading in an Equity Market

In the equity market, investors bid for stocks by offering a certain price, and sellers ask for a
specific price. When these two prices match, a sale occurs. Often, there are many investors
bidding on the same stock. When this occurs, the first investor to place the bid is the first to
get the stock. When a buyer will pay any price for the stock, they are buying at market
value; similarly, when a seller will take any price for the stock, they are selling at market
value.

When a company offers its stock on the market, it means the company is publicly traded,
and each stock represents a piece of ownership. This appeals to investors, and when a
company does well, its investors are rewarded as the value of their stocks rise.
89

Stock Exchanges

Stock exchanges can be either physical places or virtual gathering spots. Nasdaq is an
example of a virtual trading post, in which stocks are traded electronically through a
network of computers. Electronic trading posts are becoming more common and a preferred
method of trading over physical exchanges.

Physical Exchanges

In a physical exchange, orders are made in open outcry format, which is reminiscent of
depictions of Wall Street in the movies: traders shout and display hand signals across the
floor in order to place trades. Physical exchanges are made on the trading floor and filter
through a floor broker, who finds the trading post specialist for that stock to put through
the order.