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  CHAPTER  –   1 INTRODUCTION The birth place of co-operative movement in the world is England. The industrial revolution and its result have a direct bearing on the srcin of the co-operative movement in Britain. It is a product of the economics and conditions created by the industrial revolution. Germany was the first country in the world to apply the principle co-operation in the field of credit. The co-operative credit movement was started in Germany in the middle of the 19 th  century. At that time the economic condition of Germany was extremely deplorable and the  peasantry and artisans felt crashed under the heavy weight of indebtedness. Famines were a common phenomenon. The Jews wild over the market and they were not only baggers sellers but money lenders as well. Henry W. Wolf narrated the poor condition of the peasantry the distress was great. Every little cottage and tam bled down house was mortgaged most of the peasants cattle belonged to the Jews. CO-OPERATIVE MOVEMENT IN INDIA In India co-operative movement was started as an outcome of Government policy and not spontaneous democratic movement as in western countries. Co-operative in the early form was started in India by the government to save the Indian fanners from the clutches of money lenders. In 1892 the Madras provincial govt. deputed Sir. Federic Nicholson to Europe to find out measures to put an end to rural indebtedness. Nicholson submitted his report in the year 1895 recommending to organize the Raiffesen model co-operative society in India. This report can be summed up as “Find Raiffesen”  in the year 1904 the framing commission also accommodations that govt. of India appointed a committee under the chairmanship of Sir. Edward Low. Under the recommendation committee, the Indian parliament passed the co-operative credit societies Act of 1904. The main object of the legislation was to encourage thrift self-help and co-operation among agriculturist artisans and other persons of limited means.  In order to avoid the drawbacks of the 1904, another act was passed in the year 1912, which  provided for establishment of co-operative central bank by a union of primary credit societies and individuals. The chief functions of the bank are: 1.   Attracting deposits from non agriculturist 2.   Using excess fund of some societies temporarily in make up for shortage is other and, 3.   To supervise of guide the affiliated societies. In order to ensure that the progress of the movement was on sound lines, the govt. of India appointed the imperial committee in the year 1914. The made for reaching proposals for the future development of the movement. The committee “to create co -operators and then create co- operatives”.  The committee stressed the need for a pyramid structure of co-operative credit with PACS at grass root level and apex bank at top level. Co-operative banking is federal in its structure. At the lower rang, there are primary credit societies then there are the central unions of central co-operative banks and at the top there are the provincial co-operative banks or state co- operative banks, otherwise known as “apex” banks. The primary societies may be compared with joint banks. There much function is that of lending money to villagers on easier terms. They have their own fond supplemented by funds drawn from the central co-operative banks through the banking union where such union exists. The  banking union is federation of primary societies and they act as either “ co-ordinating unions” or “Supervisory union” between primary societies and central co -operative bank. The central co-operative bank obtains the funds from share capital, deposits. Loans from apex bank and while apex bank do not exists from RBI and commercial bank. The apex banks if state co-operative  bank obtain their funds from share capital deposit, loan from commercial bank, the RBI and the Govt. CO-OPERATIVE MOVEMENT IN KERALA   Co-operative movement has successful in many fields in Kerala especially in credit sector. In the credit movement Kerala has achieved the highest position. Kerala has also got notable growth in other sector like processing marketing consumers, employees, co-operative hospital, co-operative canteen societies etc. 60% of total deposit of credit societies in India is collected by the primary credit societies in Kerala. Before the organization of Kerala state there was a province, namely Cochin State and Travancore State. They had separate Act namely Cochin co-operative Act of 1913 and Travancore co-operative societies Act of 1914. When Cochin and Travancore state merged, they acts were merged into Travancore-Cochin co-operative societies Act of 1951 prior to reorganization of Kerala state, the present Malabar area was a part of Madras state of under the Madras co-operative societies Act 1932. When Kerala state come into existence the two acts were merged into Kerala co-operative society act of 1969 with the area of operation of them whole state. GENESIS OF URBAN SOCIETY As stated earlier the urban co-operative movement had found their path from the experience of German urban credit movement that was developed by Schulz. He was a judge Delitzsch. He had seen the miserable condition of the people, especially of with low means. In 1849, the organized a friendly society for relief in sickness and later established an association of shoe markers for the purchase of raw materials in well-off and who did not require any financial help. Two years later in 1852, Schulz founded a society at Delitzsch which was based on co-operative principle. He obtained the required capital through the sale of shares. He published a  book in 1856, which contained the principle of co-operative banking as formulated by him increased rapidly and in 1859. He organized a congress of these banks which in turn leads to the settings up of “The General Union of German Industrial Societies”. He was also responsible for securing from Prussia, the first co-operative law in 1867, which later on was made applicable to the entire country in 1889. THE URBAN SOCIETY IN INDIA   Like Germany, the urban credit movement in India started for catering to the banking and credit of the urban middle class, i.e., the traders and the business man, artisans and factory cooked and salaried people with fixed income in urban and semi-urban areas. If also provides opportunities for investment and thus help the people of low means to cover up the period of difficulties. The seed of urban co-operative movement was by the Maclayan committee (1915). The committee said, the credit societies might serve useful purpose in training the upper and middle class to understand ordinary banking principle. Although, the first non-agricultural credit society was organized at Baroda in and the first co-operative credit societies, but practically, no progress was made till 1915. In 1913 the Central Banking Enquiry co-operative societies, generally known as urban bank, should be established where ever necessary facilities and conditions exist, for the benefit of these classes of the population. The co-operative planning committee (1946) recommended that in view of the usefulness of the urban banks to people of small means, these should be organized in all towns. The RBI in it review on co-operative movement during 1939-40 asserted the importance of urban credit societies and banks are the most important feature of the urban co-operative movement in India and make up to some extent for the absence of joint stock banking facilities in smallest towns. STATEMENT OF THE PROBLEM  Deposits are the main source of fund, savings habit, growth of deposits, and classification of deposits are the main streams to be considered whether the growth of deposits is achieved or not, is analyzed through this study. Attitude of public towards loans and advances which are granted to different groups of society, interest rates to various loans etc. are going to understood through this study. More over the savings habit of the public are also can understand through this study. Hence the performance and the financial activities of the Mananthavady urban co-operative society as a problem to be studied upon.
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