CONTENTS

Title i
Training certificate ii
Acknowledgement iii
Preface iv
Candidate’s declaration v

CHAPTER No. DESCRIPTION PAGE No.

Chapter-1 Banking
District co-operative bank
1.1 An Introduction
1.2 Mission
1.3 Goals

Chapter-2 Cash Management

2.1 An introduction
2.2 definitions by different authors

Chapter-3 Research Methodology

3.1 Research Problem
3.2 Research Objective
3.3 Types of research
3.4 Methods of data collection
3.5 Data analysis & interpretation

Chapter-4 Conclusions

Chapter-5 Suggestion

Chapter -6 Bibliography
 INTRODUCTION

BANK
A bank is a financial institution that accepts deposits from the public and creates credit. Lending
activities can be performed either directly or indirectly through capital markets. Due to their importance
in the financial stability of a country, banks are highly regulated in most countries. Bank collects money
as deposits in the account and give loan/ disperse the loans.

HISTORY
At the time of Britishers there are 3 banks:

 Bank of Madras
 Bank of Bombay
 Bank of Kolkata

The India government merges all three banks and gives it name of Imperial Bank of India then Imperial
Bank become State Bank of India (SBI) in1955. It acted as the central bank for British India prior to the
formation of the Reserve Bank of India in 1935.

Types Of Bank
Commercial Bank: It’s a financial institution which perform the function of accepting deposits from the
the general public and giving loans for investment with the aim of earning profit. Some commercial banks are:
 State bank of India
 State Bank of Bikaner & Jaipur
 State Bank of Hyderabad
 State Bank of Indore
 State Bank of Mysore
 Private sector: The private sector banks in India are banks where the majority of the shares or equity are not
held by the government but by private shareholders. They work on their own deposits and market level. Some
private sector banks are:

 Axis Bank

 Yes Bank

 City Bank

 ICICI Bank

 HDFC Bank

Public sector: Public Sector Banks are those banks in which the Central Government holds majority of the
stake. Generally, Central Government holds 51% (or more) of the stake in a Public Sector Bank. Central
Government is responsible for managerial control of all Public Sector Banks. Some public sector bank are:
 Allahabad Bank
 Andhra Bank
 Canara Bank
 Corporation Bank
 Punjab National Bank
 Central Bank of India

Reserve Bank of India

Headquarters Mumbai, Maharashtra, India

 RBI (Reserve Bank of Coordinates 18.932679°N

72.836933°ECoordinates:

India) 18.932679°N 72.836933°E

Established 1 April 1935; 84 years ago

The Reserve Bank of India (RBI) is
Governor Shaktikanta Das
India's central banking institution, which
controls the issuance and supply of Central bank of India

the Indian rupee. Until the Monetary Policy Currency Indian rupee (₹)

Committee was established in 2016 it also Reserves ₹2,837,400 crore(US$410 billion)

controlled monetary policy in India. It
Bank rate 5.75%[4]
commenced its operations on 1 April 1935 in
Interest on 4.00% (market determined)
accordance with the Reserve Bank of India
reserves
Act, 1934.
Website rbi.org.in
To regulate the issue of Bank notes and
keeping of reserves with a view to securing
monetary stability in India and generally to operate the currency and credit system of the country to its advantage;
to have a modern monetary policy framework to meet the challenge of an increasingly complex economy, to
maintain price stability while keeping in mind the objective of growth.
 The Reserve Bank of India was established
following the Reserve Bank of India Act of 1934.

 Though privately owned initially,

it was nationalized in 1949 and since then
fully owned by Government of India.
District Co-operative Bank Ltd. Dehradun
1.1 INTRODUCTION

District Co-operative Bank was established in 1924 and on 25th March 1924, District Co-operative Bank
was registered under the Uttar Pradesh Cooperative Act 1912. Bank's headquarter was built at Kachari
Ahata, Dehradun. The bank's main branch was opened in Kachhari Aahta only. After that in 1962, the
bank's second branch was established in Vikas Nagar.
Presently 19 branches of the bank are functioning in the entire district. Under which 39 preliminary
agricultural credit cooperative societies are employed. Rural Savings Centers are also being operated by
the committees for Rural and Farmers.
District Dehradun has a geographical location in the plains and hilly regions, according to which the bank
is providing its services in remote and inaccessible areas through its branches. The bank conducts various
short and long term loan schemes to farmers. Along with this, the bank handles loan schemes for
consumers, vehicles, housing and business. Under the scheme being run by NABARD for PACS
development, PACS Development Cell has been formed in the bank through which PACS is being
properly developed.
Computerization was started from 2006, with the modern times running by the bank. In the year 2010, all
the branches and headquarter computerized had become the first co-operative bank in the state, in the
same year, in 2013, the bank has all its branches, first of all, CBSE Has the distinction of bringing into the
system. At present all the work in the bank is done under the CBS system. The facility of LPG Gas
subsidy is being provided in the Bank under the ATM Card, Mobile SMS, RTGS / NFFT and DBTL
scheme of the Government. The District Co-operative Bank Dehradun is one of the leading banks in
Uttarakhand. It has been our constant Endeavour to provide highest level of services to our
customers. Bank has its own ATM outlet in Dehradun Main Branch. We are committed to
opening our more ATM outlets at various places incoming financial year. We also provide
RTGS/NEFT & DBTL Services in our branches. We offer a wide range of personal & corporate
services to our customers in which various deposits & loan scheme to our customers as well as
agriculture loans to farmers through our 39 PACS
  SAVING ACCOUNT
These deposits accounts are one of the most popular deposits for individual accounts. These accounts not only
provide cheaque facility but also have lot of flexibility for deposits and withdrawal of funds from the account.
Most of the banks have rules for the maximum number of withdrawals in a period and the maximum amount of
withdrawal, but hardly any bank enforces these. However, banks have every right to enforce such restrictions if
it is felt that the account is being misused as a current account. Till 24/10/2011, the interest on Saving Bank
Accounts was regulated by RBI and it was fixed at 4.00% on daily balance basis. However, 25th October,
2011, RBI has deregulated Saving Fund account interest rates and now banks are free to decide the same
within certain conditions imposed by RBI. Under directions of RBI, now banks are also required to open no
frill accounts (this term is used for accounts which do not have any minimum balance requirements). Although
Public Sector Banks still pay only 4% rate of interest, some private banks like Kotak Bank and Yes Bank pay
between 6% and 7% on such deposits. From the FY 2012-13, interest earned up to Rs 10,000 in a financial
year on Saving Bank accounts is exempted from tax.

 CURRENT ACCOUNT

Current Accounts are basically meant for businessmen and are never used for the purpose of investment or savings.
These deposits are the most liquid deposits and there are no limits for number of transactions or the amount of
transactions in a day. Most of the current account are opened in the names of firm / company accounts. Cheaque
book facility is provided and the account holder can deposit all types of the cheaques and drafts in their name or
endorsed in their favour by third parties. No interest is paid by banks on these accounts. On the other hand, banks
charges certain service charges, on such accounts.

Features of Current Accounts:

 The main objective of Current Account holders in opening these account is to enable them (mostly
businessmen) to conduct their business transactions smoothly.
 There are no restrictions on the number of times deposit in cash / cheaque can be made or the amount of
such deposits;
  Usually banks do not have any interest on such current accounts. However, in recent times some banks have
introduced special current accounts where interest (as per banks' own guidelines) is paid
 The current accounts do not have any fixed maturity as these are on continuous basis account.

 Fixed Deposit (FD)/ Term Deposit Receipt (TDR)

 Senior citizens (over sixty years) will be paid 0.50 percent more interest on fixed deposits of 1
year or more.

 Reoccurring Deposit

 The minimum time period for Recurring Savings Accounts (RD) is 6 months and the rate of
interest is fixed at the time of Fixed Deposit (FD).
1.2 MISSION

1. Engage in rural financing and micro-financing

2. To remove the dominance of the common man by the middleman and money lenders
3. Ensure credit services to farmers at the low rate of interest providing the socioeconomic
condition to the people
4. Provide financial support for the needy people and farmers in the rural areas
5. Provides personal financial services for those engaged in small-scale industries and self-
employment driven activities for people in both rural and urban areas
6. To provide superior, proactive banking services to niche markets globally, while
providing cost-effective, responsive services to others in our role as a development
bank, and in so doing, meet the requirements of our stakeholders.

1.3 GOALS

To become the bank of choice for corporates, medium businesses and upmarket retail
customers and to provide cost effective developmental banking for small business, mass market
and rural markets.
CASH MANAGEMENT

2.1 Introduction
Cash is the money which includes coins, currency and cheques held by the firm. Cash is the important current
asset for the operations of the business. Cash is the
basic input needed to keep the business running on a
continuous basis; it is also the ultimate output
expected to be realized by selling the service or
product manufactured by the firm.The firm should
keep sufficient cash, neither more nor less. Cash
shortage will disrupt the firm’s manufacturing
operations while excessive cash will simply remain
idle. Cash management is a broad term that refers
to the collection, concentration, and disbursement of
cash. It encompasses a company’s level of liquidity,
its management of cash balance, and its short-term
investment strategies. In some ways, managing cash
flow is the most important job of business managers.
For some time now, technology has been the key
driving force behind every successful bank. In such
an environment, the ability to recognize and capture market share depends entirely on the bank’s competence
to evolve technically and offer the customer a seamless process flow. The objective of a cash management
system is to improve revenue, maximize profits, minimize costs and establish efficient management systems to
assist and accelerate growth.

 What is Cash Management?

 It refers to area of finance involving the collection of cash, handling of cash, usage of cash.
 It involve assessing of market liquidity, cash flows, investments.
  It is a marketing term for certain services related to cash flows offered to large business customers
and private banking customers.
 It may be used to describe all bank accounts provided to business of a certain size.
 It offers specific services such as cash concentration, zero balance accounting,
automated clearing house facilities.

• Collection of cash
It refers to a broad area of finance
• Handling of cash
involving the
• Usage of cash

• Market Liquidity
It involves assessing • Cash Flow
• Investments

It is a marketing term for certain

• Larger business customers
services related to cash flow offered
• Private banking customers
primarily to

• all bank accounts ( such as checki

It may be used to describe accounts) provided to businesses of
certain size.

• Cash concentration
It offers specific services such as • Zero balance accounting
• Automated clearing house facilities

Common Services offered for

 Cash Management
 Account Reconciliation
 Advanced web services
 Balance Reporting
 Controlled Disbursement
 Zero Balance Account
 Wire Transfer
 Sweep Account

 Account Reconciliation
 Balancing a cheaque book can be a difficult process for a very large business, since
it issues so many cheaques.

 It can take a lot of human monitoring to understand which cheaques have not cleared and
therefore what the company's true balance is.

 To address this, banks have developed a system which allows companies to upload a list of all the
cheaque that they issue on a daily basis, so that at the end of the month the bank statement will
show not only which cheaques have cleared, but also which have not.

 More recently, banks have used this system to prevent cheaques from being fraudulently cashed if
they are not on the list, a process known as positive pay.
 Account Reconciliation
 Balancing a cheaque book can be a difficult process for a
very large business, since it issues so many cheaques.

 It can take a lot of human monitoring to understand which cheaques have

not cleared and therefore what the company's true balance is.

 Advance web services

 Most banks have an Internet based system which is more advanced than
the one available to consumers.
 This enables managers to create and authorize special internal logon
credentials, allowing employees to send wires and access other cash
management features normally not found on the consumer web site.

 Balance Reporting
 Corporate clients who actively manage their cash balances usually subscribe to
secure web-based reporting of their account and transaction information at their
lead bank.

 These sophisticated compilations of banking activity may include balances in

foreign 0currencies, as well as those at other banks.

 Finally, they offer transaction-specific details on all forms of payment

activity, including:
 Deposits

 Cheaques

 Wire transfers in and out

 Investments

 Controlled disbursement
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  The bank provides a daily report, typically early in the day, that provides
the amount of disbursements that will be charged to the customer's
account.

 This early knowledge of daily funds requirement allows the customer to

invest any surplus in intraday investment opportunities, typically money
market investments.

 Zero balance account

Zero Balance Account (ZBA) is a system of cash pooling (to consolidate the
cash balances of several subsidiaries of a single company). This system is
designed to leave in the current accounts of the subsidiaries the minimum
amounts to be able to deal with their debts contracted.

 Wire transfer
 A wire transfer is an electronic transfer of funds.

 Bank wire transfers are often the most convenient method for transferring
funds between bank accounts.

 A bank wire transfer is a message to the receiving bank requesting them to

effect payment in accordance with the instructions given.

 The message also includes settlement instructions.

 The actual wire transfer itself is virtually instantaneous, requiring no longer

for transmission than a telephone call.

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Cash Management in India

The Reserve Bank of India (RBI) has placed an emphasis on upgrading

technological infrastructure. Electronic banking, cheaque imaging, enterprise
resource planning (ERP), real time gross settlement (RTGS) is just few of the new
initiatives.

The evolution of payment systems such as RTGS has posed some tough
challenges for cash management providers. It is important that banks now look
towards a shift to fees from float although all those cash management providers
who have factored in float money in their product pricing might take a hit. But of
course there are opportunities also attached like collection and disbursal of
payments on-line across the banks.

2.2 DEFINITION:

1. “Cash management is the efficient collection, disbursement,

and investment of cash in an organization while maintaining the
company’s liquidity. In other words, it is the way in which a
particular organization manages its financial operations such as
investing cash in different short-term projects, collection
of revenues, payment of expenses, and liabilities while ensuring it
has sufficient cash available for future use”

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 LITEARTURE REVIEW

Various studies conducted and numerous suggestions were sought to bring

effectiveness in the working and operations of financial institutions. Narsimham
Committee (1991) emphasized on capital adequacy and liquidity, Padamanabhan
Committee (1995) suggested CAMEL rating (in the form of ratios) to evaluate financial
and operational efficiency,

Tarapore Committee (1997) talked about Non-performing assets and asset quality,
Kannan Committee (1998) opined about working capital and lending methods, Basel
committee (1998 and revised in 2001) recommended capital adequacy norms and risk
management measures.

Kapoor Committee (1998) recommended for credit delivery system and credit
guarantee and Verma Committee (1999) recommended seven parameters (ratios) to
judge financial performance and several other committees constituted by Reserve Bank
of India to bring reforms in the banking sector by emphasizing on the improvement in
the financial health of the banks. Experts suggested various tools and techniques for
effective analysis and interpretation of the financial and operational aspects of the
financial institutions specifically banks. These have focus on the analysis of financial
viability and credit worthiness of money lending institutions with a view to predict
corporate failures and incipient incidence of bankruptcy among these institutions.

Bhaskaran and Josh (2000) concluded that the recovery performance of co-operative
credit institutions continues to unsatisfactory which contributes to the growth of NPA
even after the introduction of prudential regulations. They suggested legislative and
policy prescriptions to make co-operative credit institutions more efficient, productive
and profitable organization in tune with competitive commercial banking. Jain (2001)
has done a comparative performance analysis of District Central Cooperative Banks
(DCCBs) of Western India, namely Maharashtra, Gujarat and Rajasthan and found that
DCCBs of Rajasthan have performed better in profitability and liquidity as compared to
Gujarat and Maharashtra. Singh and Singh (2006) studied the funds management in the

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District Central Cooperative Banks (DCCBs) of Punjab with specific reference to the
analysis of financial margin. It noted that a higher proportion of own funds and the
recovery concerns have resulted in the increased margin of the Central Co-operative
Banks and thus had a larger provision for non-performing assets.

Mavaluri, Boppana and Nagarjuna (2006) suggested that performance of banking in

terms of profitability, productivity, asset quality and financial management has become
important to stable the economy. They found that public sector banks have been more
efficient than other banks operating in India.

Pal and Malik (2007) investigated the differences in the financial characteristics of 74
(public, private and foreign) banks in India based on factors, such as profitability,
liquidity, risk and efficiency. It is suggested that foreign banks were better performers,
as compared to other two categories of banks, in general and in terms of utilization of
resources in particular. Campbell (2007) focused on the relationship between
nonperforming loans (NPLs) and bank failure and argued for an effective bank
insolvency law for the prevention and control of NPLs for developing and transitional
economies as these have been suffering severe problems due to NPLs. Singla(2008)
emphasized on financial management and examined the financial position of sixteen
banks by considering profitability, capital adequacy, debt-equity and NPA.

Dutta and Basak (2008) suggested that Co-operative banks should improve their
recovery performance, adopt new system of computerized monitoring of loans,
implement proper prudential norms and organize regular workshops to sustain in the
competitive banking environment.

Chander and Chandel (2010) analyzed the financial efficiency and viability of HARCO
Bank and found poor performance of the bank on capital adequacy, liquidity, earning
quality and the management efficiency parameters

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 RESEARCH METHODOLOGY

3.1 Research problem

Due to vast data, collection of accurate data according to the study

3.2 Research Objective

The present study is proposed to examine the efficiency of funds
management in the District Co-operative Banks of Dehradun. The
major objectives of the study are:
1. To examine the trend and pattern in the sources and uses of funds of
District Co-operative Banks in Uttarakhand.
2. To analyse the efficiency in funds management by District Co-
operative Banks with respect to resource mobilisation and
utilisation.
3. To evaluate the management practices adopted for harnessing the
mobilization and deployment of funds by District Co-operative
Banks.
4. To understand how cash is being managed by District Co-operative
Bank.
5. To gain knowledge about the system prevailing in Banks.
6. To analyze in detail, the way Banks currently manage their finances
and make decisions to achieve tradeoff between profitability and
liquidity

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3.3 Types Of Research
Descriptive research is used in this study in order
to identify the Cash Management System of bank
3.4 Methods Data Collection
1. Primary Data
 Working in Bank
 Structured direct Interviews with the concerned persons of
Finance & Stores Department.

2. Secondary Data
 Annual reports of the bank
 Internet

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Findings

 The trend for the cash and bank balance is growing rapidly and
reaches high in the year ended 2017 (143) and again decreased to
120 in 2018.
 The cash from operation had been increased in the year ended 2018
Rs. 52871.9 (in lakhs), when compared to the year ended 2017 Rs.
25746.85 (in lakhs). The application of cash is more through the
purchase of asset in the year ended 2015-16 as Rs. 1095.43 (in lakhs)
and Rs. 4532.82 (in lakhs). This shows the growth of the
organisation.
 The projected current assets shows an net increase year by year and
the values are Rs. 2276- Rs.3537 i,e from 2019 to 2023.
 The current liabilities also in a increasing trend from the year 2019-
2023

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 CONCLUSION
This project was very useful to show the financial status of the company
from the management point of view and this evaluation provided a great
deal to the management to make decision on the regulation of the funds to
increase the business activities and also to bring profit to the company. The
future projections show a growth in all aspects of the company.

SUGGESTIONS
The current ratio in the organization is poor and it could be improved by
improving cash balance by issuing many short tern money market
instruments such as treasury bills, commercial paper, term deposit, certified
deposit, and deposit with financial institutions. And also this could
maintain a good current ratio.

❖ The trend of debtor is moving in an increasing trend and this increase

indicates that there is poor management of debtor is concern. Hence the

company could adopt a better credit policy for the customers and can have
a credit limit and also provide some terms and conditions for the customer
which shows good cash management in the organization [20-24].

❖ The working capital in the organization is very low particularly in the

year ended 2010-12. Hence it could be overcome by accelerating cash

inflow by way of various collection methods like lock- box system,
electronic fund transfer and slow down payment and debtor collection
centre’s etc., This would increase the working capital in the organization .

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BIBLIOGRAPHY
Internet: websites
 www.google.com

 www.wikipedia.org/

 http://wiki.answers.com

 http://www.slideshare.net

Books
 Elements of Financial Management (Swati Praka