Kut­tikkad Farm­ers Ser­vice Co­op­er­a­tive Bank

Banking Frontiers - - Cooperative -

Kut­tikad Farm­ers Ser­vice Co­op­er­a­tive Bank was es­tab­lished just be­fore in­de­pen­dence on 14 Jan­uary 1947, when 146 mem­bers joined to­gether, col­lected `1122 and reg­is­tered as a co­op­er­a­tive so­ci­ety. The so­ci­ety was ac­tive in the pub­lic dis­tri­bu­tion of ra­tion items and house­hold ar­ti­cles. In 1961, the so­ci­ety was con­verted into a ser­vice co­op­er­a­tive so­ci­ety and bank­ing op­er­a­tions were started. on 9 March 1983, it was up­graded as a farm­ers’ ser­vice co­op­er­a­tive bank.

The bank faced an un­prece­dented sit­u­a­tion in 2004 when its CEO and some other em­ploy­ees left and the losses mounted to an ex­tent that it was in ex­cess of the cap­i­tal of the bank. One of the rea­sons was the interest outgo for the re­cur­ring de­posits the bank has been col­lect­ing. The de­posits at­tracted al­most 15% com­pound interest. It was at this point the cur­rent chief ex­ec­u­tive, Shri T.J. Poulose, came on board. The board of the bank, eval­u­at­ing the sit­u­a­tion, took a de­ci­sion to stop ac­cept­ing re­cur­ring de­posits and pay back the col­lected de­posits on ma­tu­rity. Also af­ter a pe­riod of 6 months, it was de­cided to con­vert the cu­mu­la­tive de­posits into or­di­nary de­posits. While the de­pos­i­tors filed cases against the bank in the con­sumer court, co­op­er­a­tive courts and the high court, the fi­nal court ver­dict came in favor of the bank. The bank also faced sit­u­a­tion where the loan over­dues were also high.

How­ever, the bank took var­i­ous steps to cut down the over­dues and in­tro­duced new de­posit schemes. Soon, the sit­u­a­tion im­proved and the bank’s ac­counts were back in the black. The vol­ume of busi­ness in­creased and new schemes were in­tro­duced. Some of the key of­fer­ings of the bank today are: • 25% re­duc­tion in interest for prompt re­pay­ment of loans

• Agri­cul­tural loan @ 4% to ev­ery­body based on crops

• New monthly de­posit scheme with least bank com­mis­sion So­cial se­cu­rity scheme from which help upto

`1 lakh is given for med­i­cal treat­ment of dis­eases like can­cer, kid­ney mal­func­tion­ing, paral­y­sis etc. • Fi­nan­cial help for poor stu­dents and for hous­ing for poor. The funds are ob­tained from the prof­its of the bank and do­na­tions.

• Pen­sion to mem­bers of the bank, who have com­pleted 30 years mem­ber­ship and above 75 years • Loans of up to `50 lakh re­payable over 15 years

• Core bank­ing, Mobile bank­ing, ATM, locker fa­cil­ity, for­eign money trans­fer, RTGS

• PAN card fa­cil­i­ta­tion

• Ser­vice of am­bu­lance & mobile freezer

• Dis­tri­bu­tion of cat­tle feed ma­nures, fer­til­iz­ers and pes­ti­cides

• First Fi­nan­cial lit­er­acy cen­tre in pri­mary co­op­er­a­tive sec­tor

• Co­conut pro­cess­ing unit hav­ing a ca­pac­ity to process 25,000 co­conut per day.


The bank has also in­tro­duced ‘Nattunanma’, a com­pre­hen­sive pro­ject for the devel­op­ment of the ru­ral ar­eas. The pro­ject aims at in­come gen­er­a­tion and beau­ti­fi­ca­tion of the area. ‘Nattunanma’ means wel­fare of the re­gion. This is en­sured by ac­tiv­i­ties such as paddy cul­ti­va­tion, banana cul­ti­va­tion, plant­ing of fruit-bear­ing trees and root veg­etable, cre­ation of back­yard gar­dens, pro­mo­tion of flori­cul­ture and rear­ing of live­stock.

The bank has created a Fi­nan­cial Lit­er­acy Cen­ter with the as­sis­tance of NABARD, to help peo­ple un­der­stand the com­plex­i­ties of fi­nance. It is the bank is the first in the co­op­er­a­tive bank­ing sec­tor to do so. The bank today has branches at Kut­tichira, Mothirakkanny, Velookkara and Maram­code. The head of­fice func­tions from 8 am to 7 pm.


The main crop of the area is co­conut. The bank, there­fore started a co­conut pro­cess­ing unit with the help of the state gov­ern­ment and the Co­conut Devel­op­ment Board. It has a ca­pac­ity to process 25,000 co­conut per day. As part of this pro­ject, the bank dis­trib­utes co­conut oil, cat­tle feed from the pro­cess­ing unit as well as ma­nure and pes­ti­cides for farm­ers at rea­son­able rates.

The bank has also in­tro­duced a 24-hour am­bu­lance ser­vice and mobile freezer.



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