Cooperative Banks

The reason for introducing a cooperative Banking system in India is that it promotes banking habits like saving and investment among rural people.

These banks play a pertinent role in financing and providing credit to small businesses .these banks hsveva wide diversity of area under consideration but the main areas are as follows :

• Agriculture
• Livestock
• Milk
• Self employed
• Setting up small businesses units 
• Personal finance

The coming up of cooperative banks is an alternative to the earlier banking system wherein the high and exuberant interest rate charges made the farmers and the small businesses under the crucial cycle of debt. 

Cooperative Banks History 

The main reason for the cooperative banking system was the problem of rural credit which finally led to cooperative movement in India and the coming of the cooperative societies act of 1904 followed by another act in 1912 . The latter act talks about regulation and monitoring of such Banks

Types of Co-operative Banks

Co-operative banks are of four main types these are as follows:

1. Central co-operative banks- These are organized and are mainly operated at district level. These banks are further of two types – Cooperative banking union and the mixed control cooperative bank .They give loans to primary affiliated societies for a tenure of one to three years.
2. State co-operative banks- these banks are also Present in the district and with the help of these banks the Reserve Bank of India funds the cooperative institutions.It also gets a interest rate of 1% to 2% lower than standard banks 
3. Primary co-operative banks-There target audience is the urban and semi urban region and they are not called agriculture credit society.They receive loans or one can say refinance day to day to give loans for housing etc to small businesses.
4. Land development Banks- these banks are divided into three sub categories these are – primary, secondary and tertiary. These banks provide credit to farmers for various development purposes. They were earlier governed by the state and the Reserve Bank of India but now it is given to the National Bank for Agriculture and Rural Development that is NABARD.

Structure of Cooperative Bank

The main division in cooperative banks in India is divided into two categories – Rural and Urban. The rural credit institutions can be subdivided into short term or long term institutions.

They are divided as follows:

• State co-operative banks
• District Central co-operative banks
• Primary agricultural credit societies.

Urban cooperative on the other hand are:

• State cooperative and Rural development banks 
• primary co-operative agriculture and rural development bank.

Further urban banks can be either scheduled or non-scheduled. These are further subdivided into places of operation as the multi state or singly state.

Bharat Cooperative Bank

The story of the bank starts in the pre-independence period during which the youth of Billawa community migrated to Bombay in search of a job Livelihood . They worked day and night in the office in various odd jobs and many couldn’t afford accommodation and hence slept in the office. Further the vision of the community to help the needy unitedly got the Bharat Cooperative Bank into existence .Wherein the members would give  a little amount of money and contribute to the bank and earn little interest. The visionary founding fathers gave the bank the name of Bharat Cooperative Bank and the mission was to make it available across the country through branches. The logo of the bank was made in the year 1979 and the map of India shows the intent of the bank to serve the entire humanity. In the year 1979 finally the Bharat Cooperative Bank Ltd was inaugurated by the then Maharashtra cM Hashu Advani  in Mumbai.

Expansion

In the year 1991 the bank had five branches with a business if 82 moreover the coming  of the new  chairman steadfast the growth of the bank and it turned out to be the fastest growing Bank in the banking industry. In 1995 it had eleven branches with 196.3 crore. In the year 1996 the bank moved to becoming a scheduled bank and also the youngest bank to get the status. Further it became a multi state co-operative Bank in the year 1997 and opened the 25th branch in the year 1999. Later by 2015 the bank had 75 branches and had seen various technology leaps in the carrier.

Conclusion 

Cooperative banks are the backbone for the small businesses and the growth . They are crucial in providing the finances to these businesses. They are governed and monitored by RBI and the members of the bank are the owners.Some examples of Cooperative banks are – Punjab and Maharashtra co-operative bank, Bharat Co-operative Bank and Kangra co-operative bank.