A Study On KSC Apex Bank LTD - Bangalore

Consumer Awareness Towards NEFT/ RTGS Facilities
INTRODUCTION
INDUSTRY PROFILE
INDIAN BANKING:
With the Indian economy moving on to a high growth trajectory, consumption levels soaring
and investment riding high, the Indian banking sector is at a watershed. Further, as Indian
companies globalize and people of Indian origin increase their investment in India, several
Indian banks are pursuing global strategies. The industry has been growing faster than the real
economy, resulting in the ratio of assets of commercial banks to GDP increasing to 92.5 per
cent. The Indian banks have also been doing exceptionally well in the financial sector with
the price-to-book value being second only to china, according to a report by Boston
Consultancy Group.
1.1 PRE-INDEPENDENCE BANKING SCENARIO IN INDIA

In India, the ancient Hindu Scriptures refer to the money lending activities in the Vedic
period. During the Ramayana and Mahabharata eras, banking had become full-fledged
business activity and during the Manu Smriti period which followed the Vedic period
and Epic age, the business of banking was carried on by the members of the Vaish
Community. Banking is different from money lending but two terms have in practice
been taken to convey the same meaning. Banking has two important functions to
perform, one of accepting deposits and other of lending money or investment of funds.
During the Moguls period, metallic money was issued and the indigenous bankers
added one more line of money changing to their already profitable business. They
started exchanging money circulating in one part of the country with the money current
in another part of the country making good margin for them.
The English traders, who came to India in the 17th century, established some contracts
with the indigenous bankers by borrowing funds from them in 1786. The English Agency
House had established the Bank of Bengal at Calcutta with the advent of modern banking
conducted on western lines, the indigenous bankers lost further importance.
The English House Agency in Calcutta and Bombay were the bankers to the East India
Company and the European merchants in India. They had no capital of their own and
depend mainly on deposits from the public for finance. These agency houses failed as
they combined banking with trading. Among the earliest banks in established in India,
were the Bank of Bengal (1806), Bank of Bombay (1840) and Bank of Madras (1843).
ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 1

These banks were also known as "presidency banks". In 1860 the concept of limited
liability was introduced in banking. These banks (presidency banks) were allowed to
issue notes to a limited extent, but this right was taken over by the government in 1862.
In view of limited liability, several joint stock banks were floated.
The swadeshi movement which started in the early 1900s gave stimulus to the growth of
indigenous joint Stock Banks.
In 1921, the 3 presidency banks were merged to form the Imperial Bank of India. During
1900 and 1950, the Indian joint stock banks specialized in providing short term credit,
for trade in the form of cash-credit and over draft facilities, foreign exchange business,
remained the monopoly of foreign banks. Between 1900 and 1925 many banks failed due
to various reasons. The Central Banking Enquiry Committee was constituted in 1929; it
gave the reasons for the failure of banks such as Insufficient capital, Poor liquidity of
assets, Combination of non-banking activities with banking activities, Irrational credit
policy & incompetent and Inexperienced directors.
It gave wide power to RBI to regulate, supervise and develop the banking systems.
During 1950 to 1969 two important developments took place, first, the all India Rural
Credit Survey Committee, which examined the issue of credit availability at the rural
areas, recommended the creation or a state partnered sponsored bank entrusted with the
task of opening branches in the rural areas.
Accepting this recommendation, the State Bank of India Act was passed in 1955 and the
Imperial Bank of India was renamed as State Bank of India. Later in 1959 the State Bank
of India (Subsidiary Bank) Act was passed enabling SBI, to take over 8 princely state
associated banks as the subsidiaries; these banks were State Bank of Bikaner, State Bank
of Hyderabad, State Bank of Indore ,State Bank of Jaipur, State Bank of Mysore, Bank of
Patiala, State Bank of Saurashtra and Bank of Travancore.
Secondly the need about wider diffusion of banking facilities and to change the uneven
distributive pattern of bank lending was realized. The scheme of social control over
banks was announced in the parliament in December 1967. The National Credit Control
Council was set up in 1968 to assess the demand for bank credit from various sector of
the economy and to determine their respective priorities in allocation.
1.2 POST-INDEPENDENCE DEVELOPMENTS IN BANKING SECTOR

On the eve of independence in August 1947, there were 648 commercial banks,
comprising 97 scheduled and 551 non scheduled banks. Development in banking sector
is divided into two separate groups namely pre-nationalize period and post nationalize
period:
1.2.1 PRE-NATIONALIZATION PERIOD

The year 1969 was a landmark in the history of commercial banking in India. In July
of that year, the government nationalized 14 major commercial banks of the country.
In April 1980, government nationalized 6 more commercial banks.
In 1951, when the First Five Year Plan (1951 - 56) was launched, the development
of rural India was accorded the highest priority. The All India Rural Credit Survey
Committee recommended. the creation of a State - partnered and State, sponsored
bank by taking over the Imperial Bank of India and integrating with it, the former
State - owned or State - associated banks. Accordingly, an Act was passed in the
Parliament in May 1955 and the. State Bank of India was constituted on July 1,
1955.
Later, the State Bank of India (Subsidiary Banks) Act was passed in 1959 enabling
the State Bank of India to take over eight former States - associated banks as its
subsidiaries. During the pre-nationalization period, the industrial sector claimed the
lion's share in bank credit. Within the industry, the large - scale sector cornered the
bulk of credit and the share of small - scale industries was marginal. There were
many reasons for the dominance of large industrial companies in the banking sector.
A disturbing feature of the pre-nationalization banking policy was the negligible

share of agricultural sector in bank credit. This share hovered around 2 per cent of
total commercial bank credit. The privately owned commercial banks were neither
interested nor geared to meet the risky and small credit requirements of the farmers.
Similarly, the share of other non-industrial sectors in bank credit was also low. Since
the commercial banks were under the control of big industrialists, the lendable funds
of the banks were sometimes used to finance socially undesirable activities like
hoarding of essential commodities.
1.2.2 POST NATIONALIZATION PERIOD

As already noted, leading commercial banks of the country were nationalized in 1969
with the following objectives in view:

To break the ownership and control of banks by a few business families.

To prevent concentration of wealth and economic power.
To mobilize savings of the masses from every nook and corner of the country.
To pay greater attention to the credit needs of the priority sectors like
agriculture and small industries.
The post nationalization period witnessed a remarkable expansion in the banking and
financial system. The biggest achievement of nationalization was the reallocation of
sectoral credit in favour of agriculture, small industries and exports which formed the
core of the priority sector. Within agriculture, credit for the procurement of food
grains (food credit) was a major item. Other agricultural activities preferred for credit
included poultry farming, dairy and piggeries. Certain other sectors of the economy
which also received attention for credit allocation were: professionals and self
employed persons, artisans and weaker sections of society. Conversely, there was a
sharp fall in bank credit to large scale industries. However, the share of small scale
industry registered an upward trend.
Nationalization of commercial banks was a mixed blessing: After nationalization there

was a shift of emphasis from industry to agriculture. The country witnessed rapid
expansion in bank branches, even in rural areas. Branch expansion programme led to
mobilization of savings from all parts of the country. Nationalized banks were able to
pay attention to the credit needs of weaker sections, artisans and self - employed.
However, bank nationalization created its own problems like excessive
bureaucratization, red tapism and disruptive tactics of trade unions of bank employees.
1.3 CURRENT ISSUES IN INDIAN BANKING
Despite substantial improvements in the banking sector, some issues have to be
addressed over time as the reform process is entrenched further. The discussion on
banking developments revolves around on a wide range of issues like:
Overall redrawing of boundaries between the State ownership of financial
entities and private sector ones.
Public sector character of the banking sector and efficiency.
Dilution of the government stake and its impact on the performance of the
banking sector.
Corporate governance in banks and other segments of the financial system.

Transparency of policies and practices of monetary and financial agencies and

accountability.
Prudential requirements of market participants together with comprehensive
and efficient oversight of the financial system.
Maintenance of best practices in accounting and auditing, as also collection,
processing and dissemination of symmetric and detailed information to meet
the market needs.
Relevance of Development Finance Institutions (DFIs).
The commonality among these concerns has given rise to a wide recognition and
acceptance of having a set of international standards and best practices that every
systemically important country should strive to foster and implement. Financial sector
reforms, introduced in the early 1990s in a gradual and sequenced manner, were
directed at the removal of various deficiencies from which the system was suffering.
The basic objectives of reforms were to make the system more stable and efficient so
that it could contribute in accelerating the growth process.
In response to reforms, the Indian banking sector has undergone radical

transformation during the 1990s. Reforms have altered the organizational structure,
ownership pattern and domain of operations of institutions and infused competition in
the financial sector. The competition has forced the institutions to reposition
themselves in order to survive and grow. The extensive progress in technology has
enabled markets to graduate from outdated systems to modem market design, thus,
bringing about a significant reduction in the speed of execution of trades and
transaction costs.
With the increasing integration of various segments of financial markets, the

distinctions between banks and other financial intermediaries are also getting
increasingly blurred. Another important aspect of reforms in the financial sector has
been the increased participation of financial institutions, especially banks, in the
capital market. These factors have led to increased inter - linkages across financial
institutions and markets. While increased inter - linkages are expected to lead to
increased efficiency in the resource allocation process and the effectiveness of
monetary policy, they also increase the risk of contagion from one segment to another
with implications for overall financial stability. This would call for appropriate policy

responses during times of crisis. Increased inter - linkages also raise the issue of
appropriate supervisory framework.
Banking sector reforms in India are grounded in the belief that competitive efficiency
in the real sectors of the economy will pot realize its full potential unless the banking
sector was reformed as well. Thus, the principal objective of banking sector reforms
was to improve the allocative efficiency of resources and accelerate the growth
process of the real sector by removing structural deficiencies affecting the
performance of banks.
In India, while the banking system continues to play a predominant role, it is

significant to note that, as a result of various reform measures, the relative
significance of financial markets has increased. This augurs well for the overall
stability of the financial system. The East Asian crisis has also underlined the need for
a balanced financial system wherein financial markets also play an important role in
providing necessary liquidity, especially during times of crisis. Banking system also
requires liquidity in times of stress, which only deep and liquid financial markets can
provide.
1.4 TYPES OF E-PAYMENTS

1. Electronic Clearing Service (ECS Credit)
2. Electronic Clearing Service (ECS Debit)
3. Credit & Debit Cards
4. National Electronic Funds Transfer (NEFT)
5. Real Time Gross Settlement (RTGS)
1.5 NATIONAL ELECTRONIC FUNDS TRANSFER (NEFT)

NEFT is a facility provided to bank customers to enable them to transfer funds easily
and securely on a one-to-one basis. It is done via electronic messages. In order to
speed up the transactions there are up to 6 transactions in one day. Even though it is
not on real time basis like RTGS (Real Time Gross Settlement), NEFT facilities are
available in 30,000 bank branches all over the country and work on a batch mode.
NEFT has gained popularity due to it saving on time and the ease with which the
transactions can be concluded. This reflects from the fact that 42% of all electronic
transactions in the 2013 financial year were NEFT.

National Electronic Funds Transfer (NEFT) NEFT is electronic funds transfer system,
which facilitates transfer of funds to other bank accounts in over 63000 bank branches
across the country. This is a simple, secure, safe, fastest and cost effective way to
transfer funds especially for Retail remittances.
1.5.1 FEATURES OF NEFT

Customers can remit any amount using NEFT Customer intending to remit money
Through NEFT has to furnish the following particulars:
IFSC (Indian Financial System Code) of the beneficiary Bank/Branch
Full account number of the beneficiary
Name of the beneficiary.
1.5.2 BENEFITS OF NEFT

NEFT is an electronic funds transfer process used in India that allows users to easily
transfer money in a very short time. The NEFT process has numerous associated
advantages for both business and individuals. A couple of these benefits are listed here
below:
SECURE AND EFFICIENT

The NEFT process is highly efficient and it allows seamless movement of money or
transfer from a certain bank to the next. Furthermore, the entire process is regarded as
highly secure. This means there are fewer chances of errors occurring during the
whole process.
LOW COST
The other benefit that has many people considering NEFT as their main technique of
transferring money is the low cost it charges. In fact, the costs involved during the
NEFT process are much lesser compared to when you make demand drafts or pay
orders. Hence, many small businesses in India are now using NEFT due to its
economical nature.
HIGHLY RELIABLE
NEFT is highly reliable and this is attributed to the fact the Indian reserve bank is the
main coordinating agency of this process. This greatly reduces any likelihood of

discrepancy when making financial transactions between various banks. That is the
reason NEFT transactions cannot be revoked, since it has a high accuracy level.
ELIMINATES DELAYS
NEFT transactions are designed to eliminate the normal delays associated with fund
movements in general. This is because all transactions are quickly settled within one
day from the start of the transaction. This means your customers or clients will get
their money on time once it has been sent to their respective accounts.
Since the entire NEFT process is completely paperless, it helps lessen the need to cut
trees for producing paper. Hence, NEFT is environmentally friendly. Furthermore, it is
also risk free since fund transfers are processed and immediately settled within one
day.
1.6 REAL TIME GROSS SETTLEMENT (RTGS) SYSTEM

RTGS is a fund transfer systems where transfer of money or securities takes place
from one bank to another on a real time and on gross basis. Settlement in real
time means payment transaction is not subjected to any waiting period. The
transaction is settled on one to one basis without bunching or netting with any other
transaction. Once processed, payments are final and irrevocable. This was introduced
in 2004 and settles all inter-bank payments and customer transactions above 2 lakhs.
The development of RTGS systems started as a response to the growing awareness of

the need for sound risk management in large-value funds transfer systems. RTGS
systems offered a powerful mechanism for limiting settlement and systemic risks in
the inter-bank settlement process, because these risks effect final settlement of
individual funds transfers on a continuous basis during the processing day. In addition,
RTGS can also contribute to the reduction of settlement risk in securities and foreign
exchange transactions by providing a basis for Delivery-Versus-Payment (DVP) or
Payment-Versus-Payment (PVP) mechanisms. An understanding of RTGS is thus
essential when considering risk management in payment and settlement systems.
The RTGS system is primarily meant for large value transactions. The minimum
amount to be remitted through RTGS is Rs. 2 lakh. The maximum limit is Rs. 10 lakh
per day.
The RBI first implemented the RTGS in March 2004 as a major technology based
electronic funds transfer system across the country. The RTGS infrastructure is critical
in facilitating the orderly settlement of payment obligations.

In August 2013, the RTGS saw 62.10 lakh transactions (including customer
transactions, inter-bank transactions and inter-bank clearing) aggregating to Rs.
67,55,735 crore.
1.6.1 FEATURES OF RTGS

A modular component structure to meet individual country requirements and for
flexibility in growth and expansion as needs arise.
Final and irrevocable settlement of funds transfers continuously in real-time.
Centrally located queuing of payments that are held awaiting availability of funds.
Automatic gridlock resolution.
Complete monitoring of account balances for both the Central Bank and
participating institutions.
Credit and intra-day liquidity management facilities.
Maintenance of a statistical database with query and reporting facilities.
Payment entry and processing using standard SWIFT message formats.
A multi-currency and multi-lingual system.
Secure payment and message transmission using the SWIFT services & secure
interactive communication for monitoring & queue management.
Operational reliability with backup and contingency arrangements.
Complete audit trail, recovery and reporting facility.
1.6.2 BENEFITS OF RTGS

Hassle-free high value settlement: Elimination of collection through physical H/V
clearing.
Eliminates Settlement Risk & Systemic Risk
Speed: Guaranteed and fast settlement of transactions.
High Liquidity: Lower of interest costs.
Reduces paper work and improves efficiency.

1.6.3 ABILITY TO LIMIT PAYMENT SYSTEM RISK

RTGS systems can contribute substantially to limiting payment system risks. With
their continuous intraday final transfer capability, RTGS systems are able to minimize
or even eliminate the basic interbank risks in the settlement process. More
specifically, RTGS can substantially reduce the duration of credit and liquidity
exposures. To the extent that sufficient covering funds are available at the time of
processing, settlement lags will approach zero and so the primary source of risks
interbank funds transfers can be eliminated. Once settlement is effected, the receiving
bank can credit the funds to its customers, use them for its own settlement purposes in
other settlement systems or use them in exchange for assets immediately without
facing the risk of the funds being revoked. This capability also implies that, if an
RTGS system were linked to other settlement systems, the real-time transfer of
irrevocable and unconditional funds from the RTGS system to the other systems
would be possible. The use of RTGS could therefore contribute to linking the
settlement process in different funds transfer systems without the risk of payments
being revoked.
1.7 DIFFERENCES BETWEEN RTGS & NEFT

RTGS is based on gross settlement while, NEFT is based on net settlement. Gross
settlement is where a transaction is completed on a one-to-one basis without bunching
with other transactions. As for a Deferred Net Basis (DNS), or net settlement, this is
where transactions are completed in batches at specific times.
In NEFT, all transfers will be held up until a specific time whereas RTGS transactions
are processed throughout the working hours of the system.
RTGS transaction involve large amounts of cash, basically only funds above Rs.
2,00,000 may be transferred using this system. For NEFT, any amount below Rs.
1,00,000 may be transferred, and this system is generally for smaller value
transactions involving smaller amounts of money.
RTGS processes in real-time (Push Transfer), while NEFT processes in cycles during
the given working day. This causes a NEFT transaction that is initiated later than the
last cycle to be completed the next day.

COMPANY PROFILE
2.1 HISTORY
The Karnataka State Co-operative Apex Bank Limited (hereinafter referred to as the
Bank) is a Scheduled Co-operative Bank incorporated under the Karnataka State Co-
operative Societies Act 1959. It was established in the year 1915 is entering its Centenary
year during next year. During the year in its inception the Bank had deposits of Rs.1.26
lakh, owned funds of Rs. 0.54 lakh and working capital of Rs.1.80 lakh. During the last
99 years the bank has achieved significant development and considered one of the
premier State Co-operative Bank in the country. Our Bank is known for its commitment
for the development of farmers in the state and also Primary Agricultural Credit Co-
operative Societies and District Central Co-operative Banks.
Today it has 42 branches in Bangalore City through which it carries out commercial
banking activities. It does not have any branches outside Bangalore.
The Bank was registered on 10th November 1915 under the name and style of The
Mysore Provincial Cooperative Bank Limited, under the Mysore Co-operative Societies
Act of 1905. Then, the Bank was not an Apex institution, as it was not exclusively meant
for financing the co-operatives in the State of Mysore. Another Bank called the
Bangalore Central Co-operative Bank Limited, Bangalore (which was later converted
into an urban bank), which was registered in 1905, was also financing the co-operatives.
The bank owes its origin to Sri. M.A. Narayan Iyengar, B.A., B.L., who was the
Registrar of Co-operative Societies at that time.
The bank was founded with the objective of financing, inspecting and supervising the
Co-operative societies in the Mysore State. Subsequently, several district co-operative
central banks with the jurisdiction of a district were registered. Five such district central
banks were started. But their working was not satisfactory and they become defunct.

As such the provincial bank started financing the societies directly. Besides granting of
loans, the bank served as an outlet for investment of the surplus finds of the co-operative
societies in the state. The bank thus acts as the balancing centre of the co-operative
movement in the state, safeguarding its interests.
2.2 REORGANIZATION OF PROVISIONAL CO-OPERATIVE INTO AN

APEX BANK
At the time of inception of the Mysore Provincial Co-operative Bank, there was also
another co-operative organization, the Bangalore Central Co-operative Bank, which was
working on similar lines. This was an anomaly, which led to mutual competition
unnecessarily in the matter of financing of co-operative societies. In order to remove this
anomaly and to have only one institution as an Apex institution exclusively for financing
the co-operatives in the state, the government appointed and enquiry committee known
as the Mysore Co-operative Enquiry Committee, 1920-22 presided over by Mr. Lallubhai
Samaldas and the committee after reviewing the position of these two banks, made the
following three alternative recommendations to the government:
To amalgamate the Mysore Provincial Co-operative Bank and the Bangalore
Central Co-operative Bank.
To create a new Apex Bank.
To convert the Central Co-operative Bank into an urban bank dealing only with
the individuals and to reorganize the Provincial Co-operative Bank into a new
Apex Bank
2.3 PRINCIPAL FUNCTIONS OF THE APEX BANK

Financing of Short Term Loans for Seasonal Agricultural Operations and for
marketing of crops. These loans are repayable within one year.
During the year 2011-2012, Apex Bank has disbursed total loans of Rs.4423.28
crores of which Rs. 3736.37 crores for Agricultural purposes and Rs. 687.11 crores
for Non-Agricultural purpose.

Advancing Medium Term Loans for the development of agricultural infrastructure

such as Lift Irrigation, Dairy, Poultry, Plantations, Gobar Gas, etc under schematic
lending.
Providing cash credit loans to processing, marketing and consumer co-operatives as
well as sugar factories in Karnataka and also term loans to sugar factories under
consortium arrangements.
Advancing Working Capital Loans to state levels co-operatives like MARKFED,
KCCF and to the national level co-operatives such as IFFCO and KRIBHCO. The
bank provides similar facilities to public sector undertakings like Food Corporation
of India through consortium arrangements with commercial banks and at times
directly.
The Bank extends finance to non-farm sector and for the development of cottage
industries, small scale industries and rural artisans and weavers. It is a Scheduled
Bank in all respects including remittances of funds by Demand draft, Mail transfers,
Collection of cheques and Drafts.
2.4 REAL TIME GROSS SETTLEMENT (RTGS) AND NATIONAL

ELECTRONIC FUNDS TRANSFER (NEFT)
RTGS system is primarily for large value money transaction. The minimum amount to be
remitted through RTGS is Rs. 2 lakhs and below Rs. 2 lakhs can be transferred through
NEFT.
RTGS is the fastest, cheapest and has left free system of transferring money from one
account in difference places. RTGS is now implemented in Apex Bank. Apex Bank is the
fourth State Co-operative Bank in India in implementing RTGS.

RTGS or NEFT form


2.5 QUALITY OBJECTIVE

The main aims and objectives of the Bank defined in the Bank Bye Law No. III are given
below.
a. To serve as a State Co-operative Bank and as a balancing center in the State of
Karnataka for registered co-operative societies;
b. To raise funds by way of deposits, loans, grants, donations, subscriptions, subsidies
etc. for financing the members by way of loans, cash credits, over-drafts and
advances;
c. To develop, assist and co-ordinate the member DCCBs and other Co-operative
Societies and secure financial assistance for them;
d. To participate in financing Co-operative and other institutions who are members of
the bank, directly or through consortium of Bankers;
e. To participate in the schematic lending and to provide loans for which refinance
facility is available with term lending institutions.
f. To arrange for the inspection and supervision of the affiliated DCCBs and other
Co-operative Societies and guide them in their working;
g. To buy and sell securities for the legitimate investment of surplus funds and act as
agents for buyers and sellers of securities of Central/State;
h. To carry on general business of Banking and other banking activities to the
members and customers;
i. To purchase, acquire or raise or otherwise obtain moveable or immoveable property
for the own use of the Bank and also to dispose them of when not required;
j. To take measures to help Co-operative Education;
k. To promote and undertake Co-operative Research and Co-operative Development;
l. To manage, sell or release any property which may come into the possession of the
bank in satisfaction of or part satisfaction of any of its claims;
m. To promote economic interest of the members of the Bank in accordance with the
principles of Cooperation.

n. To do such other things as are incidental or conducive to the promotion and

advancement of the business of the Bank
2.6 APEX VISION

Equitable and sustainable micro financial inclusion for overall rural prosperity through
meaningful utilization of Human Endeavour and Capital.
2.7 APEX MISSION

Equitable and sustainable micro financial inclusion for overall rural prosperity through
meaningful utilization of Human Endeavour and Capital.
2.8 OBJECTIVES OF THE KSC APEX BANK

Helping farmers to get irrigation, dairy, poultry facilities and advancing working capital
loans to national level co-operative.
Financial to non-for sector for development of cotton industries rural artisans and
weavers
Bank carries all the banking transaction like remittances of funds by demand drafts, mail
transfer, collection of cheques and drafts, issue of consumer loans, vehicle loans, housing
loans, salary earners loans and gold loans etc.
Bank monitors the inland mutual arrangement scheme under which money remittances a
cheques are facilities between members banks.
Establishing banks presence in all district of Karnataka.
2.9 DOMAIN NETWORK :

State Level - Karnataka State Co-operative Apex Bank Ltd. (KSCAB)
District Level - District Central Co-operative Banks (DCCBs)
Block, Taluk & Hobli Level - District Central Co-operative Banks Branches
(DCCBBs)
Village Level - Primary Agricultural Credit Co-operative Societies (PACS)

2.10 ACTIVITIES OF THE BANK

Financing short-term (agriculture) loans for crop production and marketing of
crops and advancing Medium Term Loans for development of agricultural
infrastructure such as lift irrigation, dairy, poultry, plantation, gobar gas etc.
Extending cash credit loans to processing, marketing and consumer co-operatives
as well as sugar factories in Karnataka.
Advancing term loans to new co-operative/Private sugar factories under
consortium arrangement in Karnataka.
Advancing working capital loans to sugar factories, state level cooperatives and
to national level cooperatives such as IFFCO, KRIBHCO and to state level
undertakings through consortium arrangements with commercial banks.
Financing to non-farm sector for development of cottage industries, small scale
industries and rural artisans and weavers.
To carry on general business of Banking like remittances of funds by DD, Mail
Transfer, Collection of Cheques and Drafts, issue of consumer loans, vehicle
loans, housing loans, salary earners loans and gold loans and other banking
activities to the members and customers.
To monitor the Inland Mutual Arrangement Scheme under which money
remittances and collection of bills and cheques are facilitated between member
banks The Bank is a member of All India Mutual Arrangement Scheme, whereby
money remittances could be made and DDs issued as well as Bills and Cheques
sent for collection throughout India. Similarly, Mail Transfers and Bills
Collection are facilitated from any part of the country to Apex Bank.
2.11 BOARD OF DIRECTORS

According to the Karnataka Cooperative Societies Act and Byelaws of the Bank,
function of the Bank is regulated by the Board of Directors of the Bank consisting of
one elected nominees of each District Central Cooperative Banks and Government
Nominees. The Board is headed by the President followed by Vice President,

Managing Director. The Chief General Manager, National Bank for Agriculture and
Rural Development Bank and Registrar of Cooperative Societies are also among the
Board of Directors, and are Government Nominees.
The Board Meeting is convened once in a month. The Executive Committee Meeting
is convened once a month.
In addition, the bank is also having Sub Committees consisting of Board of Directors
in each Committee to monitor the functions of the Bank and District Central
Cooperative Banks.
2.12 PRODUCTS AVAILABLE BY APEX BANK

2.12.1 DEPOSIT SCHEMES AT ATTRACTIVE RATES OF INTEREST
Term Deposit
Savings Bank Account
Current Account
Remittances
2.12.2 LOAN PRODUCTS AT ATTRACTIVE RATES OF INTEREST

1. Site Purchase Loan
Purchase of sites at Bangalore.
2. Cash Credit Facility

This loan is for helping traders to carry on business by availing working capital
facility from the Bank.
3. Commercial Vehicle
The Bank provides loans to purchase vehicle for commercial use only.
4. Professional Loan
A loan product specially designed to offer security based and hassie free financial
assistance to professionals and self-employed persons.

5. Apex Professional
Personal loans to Doctors, Engineers, Architects and also to prompt Income Tax
payees.
6. Apex Pension
Loan for pensioners to meet Medical expenses, other genuine needs and emergent
personal expenses.
7. Apex Gold
Loans to individuals for purchase of Gold jewellery.
8. Apex Self Employment

Terms loans and working capital loan for purchase of Tools.
Loan to Auto-mechanics / Electricians / Plumbers and Carpenters engaged
in servicing & repairing, to meet their working capital requirements.
Self-employed persons who are engaged in servicing and repairs.
9. Apex Women
Loan sanctioned to women to meet their genuine personal needs like buying
household articles, gifts and jewellery.
10.Apex Retail
The loan for petty traders.
11. Apex Overdraft

Loans to individuals pursuing such activities like Retail trade, Small
Business and professionals.
Loan against the security of National Saving Certificate/Life Insurance
Corporation policy/Gold Ornaments, etc.

12.Apex Rent
Loan based on the rental income of the property Rented/leased out to
Central/State/Semi Government / Banks / Financial Institutions and Multinational
Companies.
13.Apex Travel
To meet travel and lodging expenses of individuals for travel in india and abroad
either through personally arranged tours or through conducted tours.
14. Apex Education

Educational loan to deserving/meritorious students for pursuing higher education
and professional courses in India and abroad in reputed Universities/Institutions.
15. Apex Cash

Loan against approved Bonds like RBI/NABARD/Other Government Bonds.
16. Apex Personal
Loan scheme for employees of Corporates-Professionals can avail this loan.
17. Advance Against NSCs

The Bank provides advances against NSCs to the residents of Bangalore city.
18. Jewel Loan

The Bank provides Jewel Loan against pledge of gold ornaments to the residents
of Bangalore city.
19. Vehicle Loan

The Bank provides loans to purchase two wheelers/four wheelers for personal use
only.
20. Home Loan

The housing finance services offered by the Bank include Construction of

House / Mortgage Loan, Site purchase / Mortgage Loan, Purchase of Flats etc., to
the public through its network of 42 branches in Bangalore City.
Residents of Bangalore city are eligible for housing under certain rules. Persons
applying for loans for construction of house, additional/repairs to the existing
House/Flat, purchase of House/Flats, Site Mortgage/purchase Loan etc. within
the limits of Bangalore City Corporation, BDA, BMRDA, Revenue Villages,
BIAPA & Municipalities coming under the jurisdiction of BMRDA/BIAPA &
Bangalore Rural District & Ramanagara District are eligible for loan.
21. Installment Loan

The Bank provides Personal Loans to salaried people living within Bangalore
City, to meet expenses such as education of children, medical expenses of self
and family, purchase of household articles etc.
2.12.3 VALUE ADDED SERVICES

Bank Guarantee
Bills
Safe Deposit Lockers
DDs under IMAS
DDs under AIMAS
2.12.4 INSURANCE SERVICES

Vehicle Insurance
Fire/Earthquake Insurance
Apex Gold SB Account
2.13 COMPETITORS
1. Shamrao Vital Co-Operative Bank
2. Commercial Banks
3. Corporate Banks

2.14 MILESTONES ACHIEVED/AWARDS RECEIVED

Bank is able to lend 75% of the state and it covers all sugar factories in
Karnataka.
Apex Bank is habituated to get awards at National levels year after year similarly.
NABARD has been performance award and even PACS have not have logged
behind in getting national recognition. All DCC banks and merely 80% of PACS
have proved themselves to be financially viable.
Nearly 40% of the loans have been advanced to weaker section/SC/ST and
agricultural labourers.
RTGS (Real Time Gross Settlement) system has been implemented in view of
speedy transfer of funds.
Bank has entered an agreement with Oriental Insurance Company Ltd., to sell
various insurance
2.15 AREA OF OPERATION

Apex bank works in the regional level only. It does not work in national level. The
area of operation covers the entire Bangalore. It has 42 branches in Bangalore and
headquartered in Pampa Mahakavi Road, Chamarajpet. The branches of office bank
are adequately delegated with power of sanction of disbursements. If the loans are to
be provided up to 10 lakhs it is handled by concerned branch offices but if is more
than 10 lakhs then it is handled by main branch.

2.16 OBJECTIVES OF THE STUDY

To understand the awareness towards RTGS/NEFT Facilities
To evaluate the consumer preference about the RTGS /NEFT Facilities
To focus on the activities of using the products which is helpful in transferring the money
from one place to another
2.17 SCOPE OF THE STUDY

The study is made by considering the APEX bank. It investigates about all applications
of online banking in APEX. It would help society to understand the usefulness of online
banking. The study will also help to get the knowledge about process of internet banking
and usefulness to banking industry and know about customers satisfaction level or
reliability on it.
2.18 LIMITATIONS OF THE STUDY

As the customers were busy in their daily schedules it was not possible for me to
spend more time in interaction and discussion with them
The study had to be completed within a short span of time prescribed.
2.19 RESEARCH METHODOLOGY

The study is descriptive in nature. The branch of the bank was selected by convenience
sampling and for the sake of access to the qualitative information. All the information
collected through questionnaire from the customers
Sample size =50
The methodologies follow collecting information by using two sources of data namely:
Primary data
Secondary data
PRIMARY DATA

Primary data are the data collected for the first time and not available in the secondary
source. The primary data is obtained through questionnaire with the customers of the
KSC Apex Bank Ltd.
SECONDARY DATA
The source of secondary data is published materials such as text book, periodicals,
journals, newspaper and annual reports of the KSC Apex Bank Ltd.
The following are the data sources through which the data have been collected.
Brochures issued by the bank.
Several websites on RTGS & NEFT.
Analysis and interpretation of data

After the collection of data, the task of research process is the analysis and
interpretation of the data. The questionnaire is processed to make sure that all the
questions answered are recorded. The data is tabulated and analyzed. Data analysis
includes the statistical tests, which may involve coding, tabulation and interpretation.
I have analyzed the questionnaire by using following methods.
GRAPHICAL ANALYSIS
TEST OF INDEPENDENCE CHI SQUARE

LITERATURE REVIEW
3.1 REVIEW OF LITERATURE: INTRODUCTION

This study contributes to literature by focusing Customer awareness towards RTGS &
NEFT. The aim of literature reviews is to justify, rationale of an ensuring research study,
provides an overview of historical perspectives and to bring to the light the research
trends and problems.
The present study identifies an ample number of research works at global level in general
but at domestic level very few studies have been reviewed and found most appropriate
on customer awareness towards RTGS & NEFT. The contribution of various researchers,
policy-makers and writers to this area has focused on explaining the process of the RTGS
& NEFT and satisfaction of the customer with the service, their challenges, advantages,
disadvantages, herewith, the study, in brief summary and present some of them in a
descending order as year of publication.
Raopun (2005), evaluated the level of internet banking services and compared the
overall awareness of banking facilities like NEFT, RTGS. The author used eight
dimensional quality model given by David A. Garvin, namely, performance, features,
reliability, conformance, durability, serviceability, aesthetics and perceived quality. The
results of the study indicated that reliability, security system and information accuracy
were the most important perspectives and least important was the perceived quality of
commercial bank. The results of the study could be used as a guideline to set up a form
of service in order to satisfy the needs of target group accurately and appropriately.
Erickson et al. (2005), studied the technology acceptance of banking. The objective of
the study was to see that to what extent customers accept RTGS and NEFT as a tool for
the Awareness. The findings of the study suggested that RTGS and NEFT proved to be
beneficial for the customers to some extent. However, banks need to put much efforts not

only into making a user friendly banking facilities, but also to explain their customers
how the bank facilities was useful to them.
Balwinder Singh and Malhotra .P (2004), examined the impact of online banking. The
objective of the study was to find who uses internet, why and where. It also examined the
respondents reasons for not using banking online.. The researcher analyzed that males
use more online banking than females. Main services used through websites were inter-
account transfer, paying accounts, checking balance/ statement, communication with the
banks, etc. Security was the main issue for not using banking online. The author
suggested that to make online banking more adaptive, websites should be more
attractive, more informative and colourful. Training should be given to customers.
Charges of online facilities should also be less. Banks should advertise and publicize
their new products and services offered on the websites so as to make online banking
more popular among customers.
Milind Sathye (1999), in his research paper, explored the factors affecting the adoption
of online banking by Indian customers. The author stated that online and other virtual
banking had significantly lower the cost structure than traditional delivery channels. So,
the banks should encourage customers to use internet for banking transactions. The
author also emphasized that for adoption of online banking, it was necessary that the
banks offering this service made the consumers aware about the availability of such a
product and explain how it adds value to the other products. However, internet should be
considered as a part of overall customers service and distribution strategy. These
measures could help in rapid migration of customers to online banking resulting in
considerable saving of operating costs of banks.
Marius Dannenberg, Dorothee Kellner (1998), overviewed the opportunities for

effective utilization of the Internet with regard to the banking industry. The authors
evaluated that appropriate application of todays cutting edge technology could ensure
the success of banks in the competitive market. They evaluated the services of banks via
internet as websites provide sophisticated line of products and services at low price. The
authors analyzed that transactions via internet reduce the risk of data loss to customers,
chance to cut down expenses, higher flexibility for bank employees, re-shaping the
banks image into an innovative and technologically leading institutes, etc.

ANALYSIS
Introduction
I have analyzed the questionnaires by two methods i.e.

Graphical Analysis o
Pie Charts
Statistical Analysis o
Chi2 test
95% level of confidence has been taken as the data cannot be completely accurate. The rating
measurements are assigned to various questions as per rating measurement mentioned in our
questionnaire, which is attached in annexure.


GRAPHICAL ANALYSIS
AGE OF THE RESPONDENTS
Table 1:Showing the Age of the respondent
Age
10-20 1
20-30 15
>30 34
Total 50
Graph 1: Showing the Age of the respondent
Age Of The Respondents

10-20 20-30 30-40
2%
30%
68%
The above given breakup of the sample shows the percentage of respondents from each age.
It also included potential as well as non-potential consumers of the banking industry in our
survey so that I can get the overall insight of the consumer and the reasons that might be
hindering to consumers to go to the bank. Also I have asked the consumers the suggestions
for developing the banking industry.

GENDER OF THE RESPONDENTS
Table 2: Showing the Gender of the respondents
Gender
male 45
female 5
total 50
Graph 2: Showing the Gender of the respondents
Gender Of The Respondents

male female
10%
90%
The above given breakup of the sample shows the percentage of respondents from each
gender. It also included Female consumers of the banking industry in our survey. Also I did
observation method when they gave their response.

FAMILY INCOME OF THE RESPONDENTS
Table 3:Showing the family income of the respondents

INCOME
< 10000 2
10000-20000 2
20000-30000 2
>30000 44
total 50
Graph 3:Showing the family income of the respondents
Income Of The Respondent

< 10000 10000-20000 20000-30000 >30000
4% 4%
4%
88%
In above chart it shows that maximum persons income is above 30,000. It includes all
potential & non-potential customers. It also shows that the person who is businessman whose
only income is greater than 30,000rs.


OCCUPATION OF THE RESPONDENTS

Table 4:Showing the occupation of the respondents
occupation
businessman 35
organization 1
students 10
others 4
total 50
Graph 4: Showing the occupation of the respondents
Occupation Of The Respondent

others
8%
students
20%
businessman
organization
70%
2%
In above chart it shows that 70% of the customers are businessman & rest are others.
In occupation it also include the students so I knew about the awareness of the
student in the new products because students also going in bank for banking
transaction

HOW FREQUENTLY RESPONDENTS VISIT IN THE BANK?

Table 5:Showing how frequently respondents visit in the bank
FREQUENTLY VISIT
DAILY 23
ONCE IN AWEEK 13
TWICE OR MORE IN A WEEK 11
OTHERS 3
TOTAL 50
Graph 5:Showing how frequently respondents visit in the bank
Respondent Frequently Visit In the Bank

DAILY ONCE IN AWEEK TWICE OR MORE IN A WEEK OTHERS
6%
22%
46%
26%
It was important to know that if the consumers do not use the services where do they get to
know of its existence. So I asked them and the whopping majority of 23 out of total of 50
told that they going daily in BANK for regular transaction.

RESPONDENTS TRANSACTION IN BANK

Table 6:Showing The respondents transaction in bank
TRANSACTION
TYPES
DD 3
BC 0
TT 0
MT 0
NEFT 14
RTGS 21
OTHERS 12
TOTAL 50
Graph 6:Showing The respondents transaction in bank
Bank Transaction Types

0%
0% 0%
6% DD
24% BC
28% TT
MT
NEFT
RTGS
42% OTHERS
Above chart shows that businessman maximum using new products of fund transferring. 21
people out of 50 using RTGS transaction in routine life for fund transferring from 1 bank to
another bank & 14 people out of 50 using NEFT product for fund transferring. In others
people using cash withdrawal or cash depositing transactions.

RESPONDENTS AWARENESS ABOUT THE PRODUCT
Table 7: Showing the respondents awareness about the product

AWARENESS ABOUT THE
PRODUCT
YES 42
NO 8
TOTAL 50
Graph 7:Showing the respondents awareness about the product
Awareness Of the Respondent About The

Product
YES NO
16%
84%
It shows that 42 people out of 50 are aware about the new product and rest are not aware
who is only students & include some professionals because they are not using regular fund
transferring from 1 bank to another. It is more useful for businessman whose regular
turnover is high.

HOW RESPONDENTS ARE AWARE ABOUT THE PRODUCT?
Table 8:Showing The respondents aware about the product
AWARENESS THROUGH
FRIENDS 1
BANK STAFF 35
BUSINESS PARTIES 4
OTHERS 2
NONE 8
TOTAL 50
Graph 8:Showing The respondents aware about the product
Ways of Awareness about the Product

FRIENDS BANK STAFF BUSINESS PARTIES OTHERS NONE
2%
4% 16%
8%
70%
It was important to know that if the consumers do not use the services where do they get to know of its
existence. So I asked them and the whopping majority of 35 out of total of 50 told that they got to
know of the new product of bank from bank staff. This brings out one fact very glaringly, that the
amount of peer pressure is very high among the consumers.
Awareness created by friends & business parties is comparatively lesser; reason being that the
awareness about the new product of bank advertisements come mostly only at time of its
commencement, for promoting the transaction. Otherwise promotion of transaction is usually done
through the word-of-mouth.

HOW MANY TIMES TRANSACTIONS HAVE BEEN DONE THROUGH

NEFT/RTGS?
Table 9: Showing how many transaction have been done through NEFT/ RTGS
TRANSACTION DONE
EVERYDAY 22
ONCE IN A WEEK 8
TWICE IN A WEEK 1
MORE THAN 3
TRANSACTION 6
OTHERS(NONE) 13
TOTAL 50
Graph 9: Showing how many transaction have been done through NEFT/ RTGS
NEFT/RTGS Transaction
EVERYDAY ONCE IN A WEEK TWICE IN A WEEK MORE THAN 3 TRANSACTION OTHERS(NONE)
26%
44%
12%
16%
2%
It shows that 22 people out of 50 people using every day the new product . In against the professionals
& students must not use these types of products. They simply use the Demand Draft for their education
fees transfer & other purposes.

RESPONDENTS STISFACTION ABOUT THE PRODUCT
Table 10: Showing the respondents satisfaction about the product
SATISFACTION
YES 37
NO 13
TOTAL 50
Graph 10 :Showing the respondents satisfaction about the product
Respondent Satisfaction about the Product

YES NO
26%
74%
Above chart shows that 74% customers are satisfied with the product in mostly them are businessman
& rests are students who are not aware about the product so their responses are none so I cannot said
that they are not satisfied but their answer was neutral.

WHY RESPONDENTS PREFER NEFT/RTGS?
Table 11::Showing why respondents prefer NEFT/ RTGS
PREFERANCE
EASY TRANSACTION 8
LESS COSTLY 23
USING LESS TIMING 7
OTHERS(NONE) 12
TOAL 50
Table 11::Showing why respondents prefer NEFT/ RTGS
Preference of Respondents
EASY TRANSACTION LESS COSTLY USING LESS TIMING OTHERS (NONE)
16%
24%
14%
46%
Above chart shows that more customers doing NEFT/RTGS because of less costing of the new product
in against of traditional products like DD, MT,TT, BC etc. New products are using less timing & also
it is an easy transaction for consumers. 24% people do not prefer RTGS/NEFT transactions.

WHAT KIND OF EXTRA FACILITIES WOULD RESPONDENTS PREFER TO GET ACKNOWLEDGEMENT YOUR
TRANSACTION?
Table 12: Showing what kind of extra facilities would respondents prefer to get acknowledgement your
transaction
EXTRA FACILITY
ONLINE
INFORMATION 10
TELE CALLING 21
MOBILE BANKING 19
OTHERS 0
TOTAL 50
Graph 11:Showing what kind of extra facilities would respondents prefer to get acknowledgement your
transaction
Extra Facility
ONLINE INFORMATION TELE CALLING MOBILE BANKING OTHERS
0%
20%
38%
42%
Above chart shows that 21 people out of 50 people prefer tele calling for the extra facility & rests
are prefer other facility to get acknowledgement of respondent transaction.

CHI SQUARE ANALYSIS OF VARIANCE
If a sample of size n is taken from a population having a normal distribution, then there is a well-
known result (see distribution of the sample variance) which allows a test to be made of whether
the variance of the population has a pre-determined value.
I am doing chi square test of independence of variance. It is a test of checking effect of change in
one variable on another variable.
The formula of chi square test of independence is below with various steps of testing the
hypothesis value of chi square:
STEP 1:- For a contingency table that has r rows and c columns, the chi square test can be
thought of as a test of independence. In a test of independence the null and alternative hypotheses
are:
STEP 2:- Ho: The two categorical variables are independent.
STEP - 3:- Ha: The two categorical variables are related.
STEP 4:- We can use the equation:-
Chi Square(2) = (fo - fe)2 / fe
Here, fo denotes the frequency of the observed data
fe is the frequency of the expected values.
STEP 5:- Find the df. (N-1)
STEP 6:- Find the table value (consult the Chi Square Table.)

STEP -7:- If your chi-square value is equal to or greater than the table value, reject the null
hypothesis: differences in your data are not due to chance alone.
H1:- Gender is independent to ways of awareness.
WAYS OF AWARENESS
THROUGH
THROUGH THROUGH BUSINESS THROUGH
FRIENDS BANK STAFF PARTIES PARENTS NONE
Count Count Count Count Count
GENDER MALE 1 32 4 0 8
FEMALE 1 2 0 2 0
Pearson Chi-Square Tests
WAYS
OF
AWARENESS
GENDER Chi-square 23.529
Df 4
Sig. .000*,a,b
Conclusion:- Here in this case the null hypothesis is rejected because our p value is 0.000 which is
less than the 0.05. It means gender is totally dependent on ways of awareness.

H2:- Occupation is independent to ways of awareness
WAYSOFAWARENESS
THROUGH
THROUGH THROUGH BUSINESS THROUGH
FRIENDS BANK STAFF PARTIES PARENTS NONE
Count Count Count Count Count
OCCUPATION BUSINESSMAN 0 32 3 0 0
STUDENTS 0 0 1 2 7
ORGANIZATION 1 0 0 0 0
PROFESSIONAL 1 2 0 0 1
Pearson Chi-Square Tests
WAYS
OF
AWARENESS
OCCUPATION Chi-square 72.398
df 12
Sig. .000*,a,b
Conclusion:- Here in this case the P- value is 0.000 which is less then the 0.05 so that our null
hypothesis is rejected. It means occupation is totally dependent on ways of awareness

Findings
Consumers usually the businessman & organizations know about the product of
NEFT/RTGS.
Consumers usually prefer this product because it takes less time to transfer from one
account to another account in particular branch.
Another reason is that it is less costly as compare to the traditional product & the
transaction is too easy.
As per my study, non potential customer does not know about the product because of
less banking transaction & awareness also responsible for that.
Consumers usually doing this type of transaction for transferring the funds to another
party behind that the main reason is trading of goods & services.
Students which are our non potential customers as well as professional also are not
using these products for fees transferring & other activities. They are using traditional
products like BC/DD etc.
In NEFT/RTGS the transaction cost is low as compare to traditional products so thats

why customers choose this types of products & also it is taking less timing & easy to
transfer.
Non potential customer not choosing these types of transaction because of cheque
book,because in NEFT/RTGS transaction the basic requirement of customer is cheque
book. In student saving account sometime they have not take cheque book from bank
& also they are access their account through 0rs. Balance. So they are not aware as
well as they are not doing in such type of transaction.
Ksc apex bank takes charge in traditional products like BC/DD is minimum cost 56rs.
Up to 10000rs. After that it is 4.5rs. Per1000 amount & maximum is 16,645rs. In
compare to NEFT/RTGS the minimum cost is 6 to 7rs. as per the transaction which is
decided by the RBI & maximum cost is 61rs. Above 200000rs. Transaction its cost is
only 28rs. Its only applicable till 13/7/2012. Now RBI applies new rates for the
transactions.
This cost is deferent from bank to bank because the overall costing behind the one
transaction is different from bank to.
In bank there are 2 categories of transaction NEFT & RTGS.
NEFT transaction is done when your fund transfer amount is less than 200000rs.
Above 200000rs. It is automatically converting in RTGS transaction. This criterion is
decided by the RBI.
In NEFT transaction the fund transferring validity is maximum 3 days in case of
accesses of internet connection & clearing process otherwise its transfer immediately.
Its using IFSC codes for different branch which have 11 character codes which is
useful to identify the branch & bank.
If you going through traditional products through cash transaction its too costly
transaction its amount is 90rs. Per transaction because its cost is 1.5times which is
payable by customers to bank. In traditional product transaction, PAN card must
require.
SUGGESTIONS
It is suggested that RTGS and NEFT should be given importance and the information
about it should be conveyed, as many of the customers would not be having any idea
about what actually it is
Bank provides all facilities related to NEFT/RTGS so use it maximum for fund
transferring.
I suggest the bank reduce the traditional product transaction rate for students who are
using DD/BCs transactions.
I also suggest the bank that aware the customer about the new product through given
proper guidance.
Prepare one extra team for helping the customer who provides whole knowledge
about the transaction with the help of cost effectiveness.
CONCLUSION
Based on data analysis and discussion that mentioned, it can be concluded that Banking
facilities like RTGS and NEFT have satisfied most of people banking needs. Most bank
clients enjoy using e-Banking, this results into a high level of satisfaction. It is very necessary
to pay attention to the risk related issues and a service charge of the payment systems RTGS
and NEFT as it lowers the level of satisfaction. Findings revealed that there is a weak positive
relationship between Electronic banking and consumer Awareness.. Awareness it to be created
among the usage of RTGS and NEFT payment systems as many of them are not aware of the
system itself.
Thus, I feel proud in doing my project in a well established bank which is doing a great job as
it is practicing both NEFT and RTGS system of payment. I wish to conclude by saying that
Apex Bank should increase the number of branches in other cities for further growth and to
extend its customer loyalty
BIBLIOGRAPHY
REFERENCES
1. Balwinder Singh and Malhotra. P (2004), Adoption of Online Banking: An Empirical
Investigation of Indian Banking Sector, Journal of Internet Banking & Commerce,
Vol.9, No.2, e-journal
2. Erickson. K., Kerem. K. and Nilsson. D, Customer Acceptance of Online banking in
Estonia, International Journal of Bank Marketing, Vol. 23 No.2, pp 200-16
3. Marius Dannenberg, Dorothee Kellner (1998), The bank of tomorrow with todays
technology, International Journal of Bank Marketing, Vol. 16 Iss: 2, pp. 90 97
4. Milind Sathye (1999), Adoption of Online banking by Australian consumers,
International Journal of Bank Marketing, Vol. 17 Iss: 7, pp. 324 334
5. Raopun .N (2005), A Quality Study of Online Banking in Thailand, Available at
http/www.IJCIM.th.org/v13nsp/pdf
6. The Training and guidance materials supplied by the bank
7. The Apex banks website
8. The material supplied by the faculty guide.
9. Annual reports of Karnataka State Co-operative Apex Bank.
10. Daily Business newspaper like Economic Times, Business Standard etc.,
WEBSITE REFERRED
1. www.google.com
2. www.central-bank.org.in
3. www.articles.economicstimes.com
4. www.karnatakaapex.co.in
QUESTIONNAIRE FOR CONSUMERS
Dear respondent,
We appreciate your efforts in filling this questionnaire. We are carrying out a research as a
part of our course of M.B.A and assure you that information shared by you will be used for
academic purpose only. Mention below some important terms which is helpful to fill up this
questionnaire.
BC- banker cheque

DD Demand drafts
MT Mail transfer
TT Telegraphic transfer
NEFT National electronic fund transfer
RTGS Real time gross settlement
Name: ________________________________________________
1) What is your age? Kindly mark it below.

10-20 years 20-30 Years
30 Years and more
2) Gender:
Male Female
3) Your family income:

Below Rs 10000 Rs 20000-30000
Rs 10000-20000 above Rs.30000
4) Your occupation:
Businessman Students
Organization Others, specify_____
5) How frequently do you visit the bank?

Daily Once in a week
Twice or more in a week Any other (e.g. once in a month please
specify) ___________________________________________________
6) Are you doing any kind of bank transaction?

Yes No
7) If yes, than tick below mention option

DD TT NEFT
MT BC RTGS others, specify_____
9) Are you aware about NEFT/RTGS transactions?

Yes No
10) How you can aware about this type of transactions?

Through friends Through banks staff
Through business parties Others, specify_____
11) How many times transactions have been done through NEFT/RTGS?
Everyday twice in a week
Once in a week more than 3 transaction during the week
Others, specify_____
12) Are you satisfied with new transaction (NEFT/RTGS) methods over
conventional transaction method (DD/BC)?
Yes No
13) If no, specify the reason
Transaction limit
No local access
No reliability of computers
Others, specify_____
14) Why you prefer NEFT/RTGS?

Easy transaction
Less costly
Using less timing
Others, specify____
15) What kind of extra facility would you prefer to get acknowledgement of your
transaction?
Online information
Tele calling
Mobile banking
Other specify,______
16) Any suggestions for improve existing NEFT/RTGS method?

___________________________________________________________
__________________________________________________________

A Study On KSC Apex Bank LTD - Bangalore

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Consumer Awareness Towards NEFT/ RTGS Facilities

1.1 PRE-INDEPENDENCE BANKING SCENARIO IN INDIA

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 1

1.2 POST-INDEPENDENCE DEVELOPMENTS IN BANKING SECTOR

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 2

1.2.1 PRE-NATIONALIZATION PERIOD

A disturbing feature of the pre-nationalization banking policy was the negligible

1.2.2 POST NATIONALIZATION PERIOD

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 3

To break the ownership and control of banks by a few business families.

Nationalization of commercial banks was a mixed blessing: After nationalization there

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 4

Transparency of policies and practices of monetary and financial agencies and

In response to reforms, the Indian banking sector has undergone radical

With the increasing integration of various segments of financial markets, the

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 5

In India, while the banking system continues to play a predominant role, it is

1.4 TYPES OF E-PAYMENTS

1.5 NATIONAL ELECTRONIC FUNDS TRANSFER (NEFT)

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 6

1.5.1 FEATURES OF NEFT

1.5.2 BENEFITS OF NEFT

SECURE AND EFFICIENT

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1.6 REAL TIME GROSS SETTLEMENT (RTGS) SYSTEM

The development of RTGS systems started as a response to the growing awareness of

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1.6.1 FEATURES OF RTGS

1.6.2 BENEFITS OF RTGS

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 9

1.6.3 ABILITY TO LIMIT PAYMENT SYSTEM RISK

1.7 DIFFERENCES BETWEEN RTGS & NEFT

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 10

ABBS- LEADERSHIP AND RESEARCH INSTITUTE Page 11

2.2 REORGANIZATION OF PROVISIONAL CO-OPERATIVE INTO AN

2.3 PRINCIPAL FUNCTIONS OF THE APEX BANK

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Advancing Medium Term Loans for the development of agricultural infrastructure

2.4 REAL TIME GROSS SETTLEMENT (RTGS) AND NATIONAL

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RTGS or NEFT form

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2.5 QUALITY OBJECTIVE

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n. To do such other things as are incidental or conducive to the promotion and

2.6 APEX VISION

2.7 APEX MISSION

2.8 OBJECTIVES OF THE KSC APEX BANK

2.9 DOMAIN NETWORK :

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2.10 ACTIVITIES OF THE BANK

2.11 BOARD OF DIRECTORS

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2.12 PRODUCTS AVAILABLE BY APEX BANK

2.12.2 LOAN PRODUCTS AT ATTRACTIVE RATES OF INTEREST

2. Cash Credit Facility

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8. Apex Self Employment

11. Apex Overdraft

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14. Apex Education