THIRUVANANTHAPURAM: The proposed Kerala Co-operative Bank (KCB) will focus on professionalism with technology-based services and it will not compete with Primary Agricultural Cooperative Societies (PACS), says the report submitted to the government by an expert committee headed by M S Sriram of IIM Bangalore.
Registrar of Cooperative Societies S Lalithambika told Express the proposed bank would have over 5,400 touch points making it the largest financial institution in Kerala. There are over 1,600 PACS. In certain societies, there are up to 25 branches. Though the District Cooperative Banks have over 700 branches, it is not clear if all branches will be retained, she said.
“In the Sriram panel report, there is a proposal to wind up loss-making branches. However, branches with a deposit base of over `20 crore are likely to be retained,” the registrar said.
Claiming PACS will be strengthened under the aegis of the KCB, Lalithambika said loans would be provided through such societies. She said the report had pointed out the state and district cooperative banks were not completely dependent on PACS for business.
Business from individuals, non-credit societies and other institutions are also there. In the light of these facts, there is no need for a complete federal system for KCB and PACS.It will offer direct services to the members and customers. One of the major advantages cited in avoiding the three-tier system is the reduction in establishment cost and other expenses. The thrust of the report is customer-centric banking.
It should not charge exorbitant fees or charges for its services and interest should be limited to the financial products only, says the report.
The three regional boards to be set up will have three offices. The central office will help in creating modern banking products and opening new business channels.
The capital invested by PACS will be merged with the KCB. The statutory reserves of the district banks will be converted into shares.
In effect, PACS will become the major promoter of KCB. All cooperative societies, including non-credit societies and welfare cooperatives, will be members of the proposed bank.
Registrar speak
Registrar of Cooperative Societies S Lalithambika said the proposed Kerala Cooperative Bank would have over 5,400 touch points making it the largest financial institution in Kerala
There are over 1,600 PACS. In certain societies, there are up to 25 branches
In the Sriram panel report, there is a proposal to wind up loss-making branches
PACS will be strengthened under the aegis of the KCB. The report points out the state and district coop banks are not completely dependent on PACS for business