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Credit societies start investing in technology

Cooperative credit societies in India are expanding across the length and breadth of the country. They are not only opening their branches in small towns and villages, but also expanding in metros and tier 2 & 3 cities. There are 8-10 crore people linked to credit cooperative societies in one way or the other. The sector also employs about 1 crore people across the country.


Maharashtra based Buldana Urban Credit Cooperative Society is among the top in the country. It recently opened its 407th branch in Sangli district of the state. The society has approximately 5500 employees and boasts a business mix of Rs100 crore. Sukesh Zamwar, MD, reveals details about the expansion plans: “A majority of our business comes from the rural areas of the country. We will be expanding in Maharashtra, Gujarat, Delhi, MP and Telangana in the coming months.”

Another leading credit society is Tumkur Cooperative Credit Society. Its CEO Dr N.S. Jayakumar speaks about the expansion plans: “We receive majority of our business from Tumkur and Bengaluru. We will be opening our branches in all the metro and top B15 cities like Mumbai, Pune, Delhi and Hyderabad.” For the financial year 2018, we are targeting deposits of Rs535 crore, advances of Rs485 crore and net profit of Rs 16 crore.”

REPCO Credit Society has fixed a target of Rs 16,000 crore business for FY 2017-18. Its CEO R.S. Isabella says the society will be opening its branches in Chennai, Hyderabad, Coimbatore, Tiruchirappalli and Madurai.


Gold loans, business loans, industrial loans, housing loans and machinery loans are the popular loan products offered by the credit societies to its customers. Isabella gives details about the highly demanded products of her society: “The most popular loan product among our customers is mortgage loan. We also provide project loans and business loans to our customers.”

According to Jayakumar of Tumkur Cooperative Credit Society, gold loans, vehicle loans, agriculture loans and housing loan are the most sought-after products.


Credit societies have been hit hard by the demonetization. The primary agricultural credit societies (PACS) are yet to overcome the shock. As per publicly available data, the quantum of deposits in the PACS has come down to Rs 4281 crore as on 31 October 2017, compared to Rs 4650 crore in 2016-17. There was marginal increase in loans – from Rs 532 crore in last financial year to Rs 579 crore so far.

“There are multiple factors that led to the present crisis in the cooperative sector though they somehow managed to overcome the initial shock of the demonetization,” says K. Narayanan, district secretary of the Kerala Primary Cooperative Societies Association.

After demonetisation, people are afraid to deposit their money in credit societies, following several indirect campaigns against these societies. The situation got worsened for them after the finance bill, which banned cash transactions over Rs 2 lakh. The basic revenue of the primary societies is from gold loans, but now the customers find it difficult to avail these loans as they cannot take it in cash or remit the loan amount in cash if it is more than Rs 2 lakh.

Sukesh Zamwar of Buldana Urban Credit Cooperative Society has made an earnest appeal to prime minister Narendra Modi to help arrest the plummeting confidence of people in the 50,000 plus cooperative credit societies active in the country.


REPCO sends its employees to the National Institute of Bank Management, Pune for training. It also provides in house training to our employees. It has a systematic induction program for new entrants and the training programs cover topics such as human resources, operations, credit policies and retail banking. Tumkur Cooperative Credit Society mainly gives training on products, marketing, customer service to its employees.


Almost all the cooperative credit societies give prime importance to branch ambience and training for its employees. Says Isabella of REPCO: “Around 75% of our branches are air-conditioned. We believe in the ambience of the branches which we feel helps us to provide better service to our customers. We have recently shifted 6 of our branches to central locations in the cities.”

Tumkur Cooperative Credit Society has 12 branches and one administration office, all of which are fully air-conditioned. For the convenience of its customers, it is planning to introduce eLobbies in the coming months.

While branches remain key, customers of cooperative credit societies are interested in technology-enabled banking services. Buldana Urban Credit Cooperative Society is planning to introduce QR code payments. It has developed Buldana Urban Pay, a mobile app that allows customers to access bank accounts using their registered mobile phones. Using the app, they can view account related information like balance enquiry, mini statement and do fund transfer and manage beneficiaries. All these features help the society to provide better services to its customers.

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