The Government of Kerala, India, established Kerala Co Bank Limited, also known as Kerala Bank, as a cooperative bank. As the Kerala government established this bank in 2019 by merging 14 District Cooperative Banks (DCBs) with Kerala State Cooperative Bank in an effort to increase financial inclusion in remote areas of the state.
This idea has to be reflected in a fundamental banking solution. Through the successful integration of the 13 pre-merger systems into a single core banking solution, the bank was able to better serve their clients by providing real-time information, increased efficiency, and greater security.
Kerala Co Bank- Introduction
A modern economy’s foundation is its banking system. The nation’s progress is significantly supported by banking institutions and the stability of this sector is must to a sustainable economy. Where a big role of this is also played by cooperative banks. Kerala’s economy is thriving because to its co-operative sector, which has a long and cherished history of making a huge contribution to the process of nation-building. The Kerala government has begun implementing a number of structural reforms in the cooperative banking industry and so on 29 November 2019, 13 DCB’s amalgamated with the Kerala State Co-operative Bank.
Large-scale state development in all important industries is the goal of the new entity, which is now known as Kerala Bank. From a Keralan perspective, it is the bank of the average person. With the overarching goal of providing a safe, dependable, and reasonably priced financial service that is accessible to all societal segments, Kerala Bank was founded. By preparing itself to advance aggressively in the face of a shifting economic environment, the bank is fortifying the foundation of the state’s Co-operative Economic Community.
Regardless of urban or rural disparities, Kerala Bank’s structure is sufficient to provide service throughout the state. It has a corporate business office in Ernakulam, seven regional offices, and credit processing centres spread throughout the state’s 14 districts. Currently, Kerala Bank operates more than 820 branches throughout the state.
Features & Services of Kerala Co Bank
Kerala Co Bank encourages both individuals and institutions to save and invest. It is now offering modern financial services to all segments of society. Kerala Co Bank will become the state’s most well-liked bank as soon as possible. Each and every Keralite will view Kerala Bank as their own bank. In the near future, Kerala Co Bank will have accounts in every household in the state. Additionally, efforts are underway to add all autonomous institutions, the government, and quasi-government as Bank customers.
The foundation of Kerala Bank is made up of primary agricultural cooperative banks. Primary Agriculture Co-operative Societies (PACS), the state’s most well-known cooperative organization. It also wants to advance co-operative banking by bolstering Urban Co-operative Banks, Primary Agriculture Co-operative Societies (PACS), and other co-ops. Kerala’s overall development is the Bank’s ultimate objective. Kerala Bank will continue to assist the people of Kerala in meeting their financial and livelihood needs.
Kerala Co Bank- Structure
Kerala Bank has its corporate office in Kochi and its headquarters in Thiruvananthapuram. In order to manage the operations of two districts each, the Bank merged two District Co-operative Banks to form seven regional offices. The regional offices are located in Thrissur, Palakkad, Kozhikode, Kannur, Thiruvananthapuram, Alappuzha, and Kottayam.
Board of Management (BoM)
The chairman and 10 other members make up the Board of Mgt. The Board of Directors will form a BOM as per RBI rules. A Board of Mgt. with a maximum of 12 members will be made.
- At least 50% of the members of BOM must be individuals with specific expertise or real-world experience in one or more of listed areas.
- If the elected members of the Board of Directors fulfil the requirements, they will form the Board of Directors. However, the BoD must account for no more than 50% of the BoM members and have to be a minimum of 2 members from outside the BoD on the Board of Management. Meetings of the Board of Mgt. may be held as often as is thought necessary. From among the members of the BoM, the Chairman will be chosen by the BoD. According to RBI standards, the Board of Directors will periodically set sitting fees and allowances for the independent professional members of the Board of Management. The BOD’s and BOM’s terms will be concurrent.
Governance structure
- The secretary of the state cooperative department, representatives from the main cooperative societies.
- NABARD’s nominee, 2 independent professional directors, and four ex-officio members.
- There is a sufficient representation of women and SCs/STs among the principal societies’ nominees.
Kerala Co Bank- size and position
- In the state, Kerala Bank is the second-biggest bank.
- With many branches, it has the second-largest branch network in the state, after SBI.
- Kerala Bank’s deposit base would be Rs 65,000 crore, whereas SBI’s is Rs 1.53 lakh crore in the state.
- Kerala Bank has the ability to take NRI deposits, which will increase its deposit base in comparison to state and district cooperative banks.
- The DCBs would acquire the status of a scheduled bank as a component of Kerala Co Bank.
- Kerala’s cooperative banking sector currently holds a 30% market share in loans and deposits, but once it starts to take NRI deposits, this might rise considerably.
Benefit of merger
- The new Kerala Bank may provide contemporary banking services that many customers in the cooperative sector have not yet had access to, such as online transactions and automated teller machines.
- There would be equality in the sector’s services and interest rates for loans and savings.
- In addition to providing their members with a wealth of contemporary banking services, the main cooperative societies may encourage technology-driven banking in rural areas.
- The inability of consumers to maintain a minimum deposit will not result in a fee from Kerala Bank.
- The government claims that the Bank will support Kerala’s economic growth by lending financial support to development initiatives without sacrificing their commercial viability.
- The opposition, meanwhile, has claimed that the sector would suffer from the combination of cooperative banks.
Kerala Co Bank- Offerings
A wide range of savings account options with competitive and best interest rates are available from Kerala Bank. Create a savings account with Kerala Co Bank to take advantage of our high interest rate, monthly interest payments, ATM debit card capabilities, alluring promotions, and much more. The interest rate for all Saving Bank accounts is 4%.
Kerala Co Bank- Future & Challenges
- It is still to be seen how depositors respond to being included in an ecosystem of increased accountability.
- It will be the responsibility of the state government to remove the new organization from the political shadow that usually surrounds the cooperative sector and to bring professionalism to its operations.
- In addition to the requirement to provide a compliance report by the end of March, Kerala Bank will also need to monitor non-performing assets (NPAs) during a period when the state cooperative bank is experiencing financial difficulties.
Kerala Co Bank- Ombudsman
Kerala Co Bank falls under the Co-operative Ombudsman program. According to Section 69A of the Kerala Co-operative Societies Act, 1969, the “Kerala Cooperative Ombudsman Scheme” is a program designed to facilitate the resolution of grievances regarding deficiencies in banking or other services provided by cooperative societies that are involved in the banking industry. Consumers who have grievances about inadequate banking or other services provided by Kerala Bank branches or other offices can file a complaint with the Co-operative Ombudsman.