Gay­a­tri UCB

Tech­nol­ogy and quick sanc­tions are its growth driv­ers:

Banking Frontiers - - Contents - Me­hul@bank­ingfron­

The Jag­tial, Te­lan­gana-based Gay­a­tri Co­op­er­a­tive Ur­ban Bank started func­tion­ing in 2000 tar­get­ing the poor and mid­dle class peo­ple of in and around the dis­trict. When launched, it had just 1008 mem­bers and `2.5 mil­lion as share cap­i­tal. Since then, the bank has been able to mo­bi­lize a mem­ber­ship to 33,832 and in­crease its share cap­i­tal to `224.6 mil­lion.


The bank to­day has 21 branches across the state. In FY 2017-18, it opened 2 new branches and in­stalled 15 new ATMs. Vana­mala Srini­vas, the bank’s MD and CEO, says the plan is to open 16 more branches and 25 ad­di­tional ATMs by the end of 2018-19. He main­tains that lot of ad­di­tional con­ve­niences are pro­vided at the branches, while CBS has been up­graded and mo­bile bank­ing has been in­tro­duced. The bank has also in­stalled on­site ATMs at 10 branches.

Says Srini­vas: “We have been en­sur­ing suf­fi­cient cash lev­els at the ATMs as well as at the branch coun­ters after the de­mon­e­ti­za­tion so that our cus­tomers are not in­con­ve­nienced.”

The bank has 148 em­ploy­ees, after adding 35 new em­ploy­ees in 2017-18. Busi­ness per em­ployee in­creased to `53.7 mil­lion dur­ing the year from `49.1 mil­lion a year ago. The bank is in­tend­ing to hire pro­fes­sion­als like MBAs in fi­nance as well as those with ac­count­ing qual­i­fi­ca­tions dur­ing the cur­rent fi­nan­cial year.


The bank had a cus­tomer base of 386,548 as of 2017-18. Srini­vas says sev­eral steps have been ini­ti­ated dur­ing the year to at­tract new bor­row­ers. He adds that the bank has been able to reach a premier po­si­tion without hav­ing to com­pro­mise the spirit of co­op­er­a­tive prin­ci­ples even as it was able to as­sim­i­late and im­ple­ment newer meth­ods of work or­ga­ni­za­tion and man­age­ment. It never wa­vered from its com­mit­ment to its ob­jec­tives. The bank has been pro­vid­ing nu­mer­ous tech­nol­o­gy­based ser­vices like mo­bile bank­ing, RTGS, NEFT, NACH, ATM, RuPay debit card and toll-free bank­ing.

The bank has in­tro­duced lower in­ter­est rates, levies no pro­cess­ing charges in many in­stances and quick and easy pro­cess­ing has been the norm. It has also in­tro­duced a ded­i­cated loans pro­cess­ing cen­ter at the head of­fice and var­i­ous loan prod­ucts to meet spe­cific needs of cus­tomers with full se­cu­rity. “We are able to achieve con­sid­er­able growth in the num­ber of ac­counts. For the con­ve­nience of the new cus­tomers, we pro­vide the fa­cil­ity to take pho­to­graphs and copies of doc­u­ments at our own branch premises so that ac­count open­ing is an ef­fort­less process. There are no ex­tra charges for these ser­vices. We have also been pro­vid­ing safest locker fa­cil­ity to our cus­tomers without any cau­tion deposits. Our bank­ing tim­ings are from 10 am to 7 pm. Our aim is to have 100,000 new cus­tomers in this fi­nan­cial year,” says Srini­vas.

There is a help desk at the en­trance of every branch of the bank with the aim of help­ing and guid­ing il­lit­er­ate peo­ple who would want to open ac­counts and avail of bank­ing fa­cil­i­ties. Be­sides, ex­ist­ing cus­tomers can get re­quired in­for­ma­tion about their own ac­counts and ob­tain ac­count state­ments at these help desks. They are also guided to re­spec­tive coun­ters to carry out their trans­ac­tions. The bank pro­vides `100,000 accidental in­sur­ance to the Gay­a­tri Nirb­haya Sav­ing Ac­count hold­ers.


The bank had col­lected `1412.4 mil­lion in deposits in 2017-18 while it ex­tended `981.2 mil­lion in loans and ad­vances. With cu­mu­la­tive deposits of `4833.6 mil­lion and ad­vances of `3117.3 mil­lion, the bank has been able to achieve a yoy growth of 41.29% in deposits and 45.94% in loans. Says Srini­vas: “Since in­cep­tion we are con­cen­trat­ing on low cost and no cost deposits to re­duce the in­ter­est ex­pen­di­ture. As on 31 March 2018, we have `2170 mil­lion of CASA deposits.”

The bank has been con­cen­trat­ing on agri­cul­ture, re­tail trade and small-scale in­dus­tries as the main sec­tors to of­fer credit fa­cil­i­ties. Be­sides, it has also pro­vid­ing loans for higher ed­u­ca­tion, and for trade. It has a wide range of prod­ucts to cater to the needs of large, medium and small cus­tomers and through these prod­ucts, it has been sup­port­ing all types of en­trepreneurs, who have been ben­e­fited from the fi­nan­cial back­ing pro­vided by the bank.

Srini­vas hopes to have bet­ter per­for­mance on the loan front in 2018-19. “In the cur­rent mar­ket sce­nario, there is more scope for lend­ing. As we are of­fer­ing in­ter­est rates

on loans on par with na­tion­al­ized banks, and we have an ef­fi­cient loan pro­cess­ing sys­tem, we ex­pect to see a 45-49% growth in loans and ad­vances in this fi­nan­cial year. We pro­pose to lend more to agri­cul­ture and al­lied seg­ments in 2018-19.”


The cen­tral­ized loan pro­cess­ing cen­ter has made the loan pro­cess­ing easy and less time con­sum­ing. The ex­pe­ri­enced staff at the cen­ter thor­oughly scru­ti­nizes the pro­pos­als from branches and de­pend­ing on vi­a­bil­ity, rec­om­mends sanc­tion of loans to the com­pe­tent au­thor­ity. The cen­ter en­sures that dis­burse­ments are per­mit­ted only as per terms of sanc­tion and post-sanc­tion in­spec­tion of the unit and se­cu­ri­ties. More­over, it also reg­u­larly watches the loan ac­counts and fol­lows up reg­u­larly with the branches on re­cov­ery pro­ce­dures.

Says Srini­vas: “With a ded­i­cated team at the helm at the cen­ter, the loan pro­pos­als are mov­ing fast and sanc­tions for vi­able projects are given on pri­or­ity ba­sis. These quick sanc­tions at­tract many cus­tomers to us. The team also en­sures that su­per­vi­sion and mon­i­tor­ing of credit are metic­u­lously fol­lowed to en­sure that the ac­counts op­er­ate at es­ti­mated lev­els. The ac­counts are closely mon­i­tored and timely cor­rec­tive ac­tions will be ini­ti­ated to check any slip­page. Monthly re­ports in a pre­scribed for­mat on slip­pages are gen­er­ated, which are closely ex­am­ined by me and my of­fice and im­me­di­ate cor­rec­tive ac­tion is ini­ti­ated. The per­cent­age of loan pro­pos­als ap­proved by the bank dur­ing the last 3 years is 74% (2015-16), 77% (2016-17) and 78% (2017-18).”


The bank has im­ple­mented CBS. It has also com­mis­sioned tech­nol­ogy tools for e-pay­ment ser­vices, auto rec­on­cil­i­a­tion of all pay­ment sys­tems and mo­bile bank­ing ap­pli­ca­tion. It has ATM sub-mem­ber­ship un­der NFS with NPCI. Re­cently it has up­graded its CBS, ATM ser­vices, mo­bile bank­ing ser­vices and SMS bank­ing fa­cil­ity. It also has NACH, Host to Host con­nec­tiv­ity, CTS clearing ser­vices and RTGS. Mum­bai-based BSG IT Soft and Pune-based Sar­va­tra Tech­nolo­gies are the main tech­nol­ogy ven­dors and con­sul­tants. The bank is run­ning all the pay­ment sys­tems un­der ASP model, which means there is no one time in­vest­ment. There­fore, there is no al­lo­cated IT bud­get, says Srini­vas. There is an IT team con­sist­ing of 9 mem­bers.


The bank has plans to launch a num­ber of dig­i­tal prod­ucts dur­ing this fi­nan­cial year. These in­clude, ac­cord­ing to Srini­vas, toll­free bank­ing, en­abling the cus­tomers for FD book­ing, hot-list­ing ATM cards, loan en­quiry, loan EMI pay­ments, cheque book re­quests, pay­ments of util­ity bills through BBPS, kiosk self-ser­vice points for pass­book print­ing, cash deposits and trans­fer en­tries, RuPay plat­inum cards, UPI and QR pay­ment sys­tem.

The bank is al­ready pro­vid­ing di­rect cash ben­e­fit trans­fer fa­cil­ity through Aad­haar seed­ing. It has mapped 248,449 ac­counts in NPCI.


The bank has im­proved phys­i­cal se­cu­rity at branches and ATMs in the last 12 months. It has ap­pointed se­cu­rity guards on 24-hour duty at all the ATMs. In ad­di­tion, it has in­stalled sur­veil­lance cam­eras for an ef­fec­tive mon­i­tor­ing sys­tem.

All the ATMs in­stalled by the bank are of NCR make. On an av­er­age, 613 trans­ac­tions take place per day per ATM. The bank has is­sued 123,417 RuPay ATM/debit cards.


The bank’s gross NPA stood at as on 31-032018 is `29.593 mil­lion (0.95% of to­tal loans) as against `10.385 mil­lion (0.49%) a year ago. Srini­vas says the move­ment of NPA to stan­dard and stan­dard to NPA has been an on­go­ing process sub­ject to mar­ket sit­u­a­tions. The net NPA is nil. “There is 184.96% of growth in amount and 93.88% of growth in per­cent­age terms in gross NPA. But, there are no will­ful de­fault­ers and no chronic NPAs. We are try­ing to main­tain gross NPA to be less than 2% in the cur­rent fi­nan­cial year and net NPA as nil in fu­ture also,” says Srini­vas.


Gay­a­tri Co­op­er­a­tive Ur­ban Bank is not in­ter­ested in sell­ing in­sur­ance prod­ucts to its cus­tomers, be­cause it feels that nowa­days cus­tomers are hes­i­tant to spend their time for dis­cus­sion on these prod­ucts. The bank has no plans to sell any new third party-prod­ucts dur­ing this year as well, as it is the strat­egy of the bank to not bother the cus­tomers. “We want our cus­tomers to hap­pily visit our bank branches for their bank­ing needs only. We will con­tinue to use the in­sur­ance tie-ups only for the pur­pose of of­fer­ing them to our em­ploy­ees,” says Srini­vas.


The bank has ded­i­cated au­dit and le­gal cells at head of­fice to guide and mon­i­tor the branches to com­ply with reg­u­la­tory needs. How­ever, it does not have sep­a­rate teams for mar­ket­ing. Ex­plains Srini­vas: “We di­vided our branch busi­ness into 4 sec­tions, al­lot­ted to 4 of­fi­cers at the branch. These sec­tion heads have to mar­ket and im­prove their al­lot­ted busi­ness/ prod­ucts to achieve their tar­gets.”


While the bank’s oper­a­tions are con­fined to Te­lan­gana, it had stood at the sec­ond place among all the UCBs in the state in terms of busi­ness and oper­a­tions. Srini­vas re­veals: “We have been aim­ing to be­come a mul­ti­state co­op­er­a­tive ur­ban bank soon and also to be in first po­si­tion in Te­lan­gana.”

Vana­mala Srini­vas is op­ti­mistic about a bet­ter scope for lend­ing in the cur­rent mar­ket sce­nario

In­au­gu­ra­tion of Nir­mal branch of Gay­a­tri Coop Bank by A. In­drakaran Reddy, Min­is­ter for En­dow­ment, Te­lan­gana

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