Krishna Gramina Bank

KGB COMPANY PROFILE
The Krishna Grameena Bank (KGB) was established on Jan. 1st 1978 to address rural credit needs in Gulbarga and Bidar districts of KGB is sponsored by State Bank of India (SBI). It celebrated its silver jubilee on 7th December, 2003 and dedicated new head office building on this occasion.

Krishna Grameena Bank is covering 631 villages through 74 branches and 157 villages through 32 branches. In other words, Krishna Grameena Bank is able to provide service to 4.16 lakhs customers through 106 branches and 6 satellite branches in these economically backward districts.

Policy Guidelines and Vision of Krishna Grameena Bank:
The Krishna Grameena Bank has developed a practice of preparing a policy document envisaging annual plan at the beginning of achieved during the previous year, in comparison with three preceding years, and enumerates the targets for achievement in the coming year for various business parameters. This circulated by Chairman to the General manager, all section heads, Area Managers and Branch managers thereby making all the employees aware of the future action plan.

The Krishna Grameena Bank’s vision statement has been coined by the employers who underwent OD and training facilities by NABARD and it states that KGB is improve the living standards of the masses and development of the area with sustained viability.

Personnel Management Department:
The human asset is of paramount importance in any organization. This department has primarily responsibility of recruitment, development and enrichment of human sources at Krishna Grameena Bank. The greatest challenge has been to change and orient the mind set of staff to cater the expectations of its stake holders and customers.

Requirement:
Majority of staff are of middle and senior age, and there is less of young bland in the bank. As the senior staffs retire, there may be a vaccum / gap hence the newly recruited staff should be introduced early in the organisation.

Job Rotation:
Generally, job rotation is done based on the need however, in branches where the business volume is high quarterly job rotation is a proactive.

Promotion:
So far the promotions have been given to the staff at four occasions i.e., 1988, 1996, 12997 and 1998. Promotion needs to be expedite so that it acts as a moral boosting / carrier progression major for the staff.

Transfer Policy:
Krishna Grameena Bank has divised rational and transparent transfer policy by classifying branches into four categories.

For example: A category (8 most convenient branches)
B category (27 convenient branches )
C category (49 difficult branches)

Transfer Policy:
Krishna Grameena Bank has devised rational and transparent transfer policy by classifying branches into four categories viz., A category (8 most convenient branches, B category 27 covneinet branches, C category 49 difficult branches and D category 25 most difficult branches. As the management is taking the unions into confidence while effecting transfers, generally the motivation levels of employees are maintained so as to continue the business performance.

General Banking Department:
The General Banking Department is responsible for planning and development functions which include preparation of annual business plans, DAP / MOV (Development Action Plans / Memorandum of Understanding), submission of statutory returns to RBI and NABARD, designing new products / services and computerization at HO/AO/BO.

Credit management Department:
This department is responsible primarily for processing and sanction of loan proposals, speedy dispersal of sanctioned loans, receipt and scrutiny of loan documents, availing refinance from NABARD / SBI, Coverage of crop insurance and correction / release of premium / claims, promotion of SHGs and VVV clubs, management of SBI Life Insurance Business at HO as Nodal office and submission of returns / statements to NABARD / RBI / SBI Life / other agencies.

Funds Management Department:
This department is responsible for managing all activities related to funds management including investments, with a primary aim for effective cash management and asset liability management (ALM) at the bank level. This department is undertaking the following major functions.

To plan and implement the funds management policies as per the guidelines and norms prescribed by RBI, NABARD and SBI.
To facilitate transfer of funds between sponsor bank / NABARD and HO, HO and branches or among the branches through cash, cheque, II and DD.
To monitor and supervise SLR, CRR, and CRL/BR.
To ensure the compilation of weekly returns of funds management status from Bos to Aos to HO.
To avail the eligible refinance from NABARD and sponsor bank and also to arrange funds for meeting repayment obligations.

Assets Management Department:
This department of primarily responsible for managing the assets, both performing and non-performing, in the bank through following functions.
Monitoring and review of NPA’s in quarterly and monthly meetings.
To organize “Krishna Samipya’ – borrower meeting to ensure better recovery.
Ensuring the provisions to be made for loss making assets.

Overall Business performance of KGB in the context of corporate governance:
Krishna Grameena Bank Operational area consists of two socio-economically backward districts of Gulbarga and Bidar, majority of which is under rain fed cultivation. Further, these districts have been reeling under the drought for the last three years. However overall business performance of KGB is good due to various good governance practices as explained in section 4.2 (with 25 major areas). If the areas which needs to be refined and improved are given a special attribution, along with continuity of dynamic leadership supportive board and motivated staff, GB can achieve excellence in future.

The historical growth of KGB in 25 years has also shown that performance depends on several internal factors including proactive top management and sound HRD practices. Therefore, Krishna Grameena Bank should devote more efforts to empower the employees so that they can serve the customers effectively with high quality service.

Marketing Strategies and Brand Image of KGB:
The Krishna Grameena Bank has developed unique brand image by including ‘Krishna’ in most of the product and services i.e., Krishna samipya for borrowes meet, Krishna Jeevan Mitra SB A/c. for accidental insurance coverage, Krishna Kisan card for formers credit cards, gift of a bag with a moments to all visitors coming to the bank having Krishna Grameena Bank name an logo, distribution of over 50,000calenders in local languages (Kannada) containing all basic information about important festivals / events / photos instead of giving dairies – publicity through the latter is much less to the customers, distribution of banners / pamphlets containing information about banks products and services etc.

The extensive usage of ‘Krishna’ as a brand name in most of its products has given a significant market presence for Krishna Grameena Bank. This brand image has been maintained and strengtheneded by proper and aggressive marketing strategies also. For example, when few claims after Krishna Grameena Bank marketed over 50,000 policies of super suraksha and 15,000 policies of sudarshan, Krishna Grameena Bank organized public function in respective area offices and invited local dignitaries to distribute the cheques for payment of claims. A special effort was made to give extensive media coverage for these events, which produced enormous impact further.

In short, Krishna Grameena Bank oriented approach to build image and to expand marketing has been a successful strategy.

Innovations of Krishna Grameena Bank in Products and Services:
Considering the on going changes in the operational area and increasing challenges from the competitors, Krishna Grameena Bank has been continuously designing new products and services to retain its existing customers and also to attract new customers. The recent initiatives implemented by Krishna Grameena Bank have been enumerated here below:

When BSNL introduced mobile telephony during January 2003, Krishna Grameena Bank came out with loan product to finance purchase of mobile, equipment with a nominal installment of Rs. 100-150 per month. This could bring considerable business to Krishna Grameena Bank and more particularly meeting the requirements of customers.
Similarly, Krishna Grameena Bank has been financing SHG’s, Anganwadi workers, VVV Club members, farmers etc to purchase LPG instruments and connection with a loan of Rs. 4,000/- and easy instalment of Rs. 100 per month in some cases, few unemployed youth have been given loans to purchase auto to supply refill cylinders to the customers in villages where LPG agencies are unable to do. This has brought significant rapport with the variety of customers to Krishna Grameena Bank and indirectly reducing the dependency of user community on fuel wood.
Krishna Grameena Bank has organized special seminar / workshop on financing manual and aromatic plants, floriculture crops etc and has financed few projects on experimental basis. Depending on the results, from production and marketing as also recovery, Krishna Grameena Bank is planning to advances more loans in this sector with an aim to diversify into emerging loans.
Krishna Grameena Bank has organized inspecial providing to large scale finance to some activities but it has taken a proactive approach in this regard during last 2-3 years. KGB has extended large scale finance of Rs. 25-50 lakhs after careful appraisal for ware house construction (for shortage of red gram, which is in surplus production in Gulbarga), hotel / lodging, shopping complex, marriage halls, bull dozers, earth movers etc. This has approved to be an encouraging experience for Krishna Grameena Bank.
Some of the rural branches of Krishna Grameena Bank have been facing problem of electricity and therefore Krishna Grameena Bank has introduced a scheme wherein if a branch fiannces 10 customer for the solar units, it is giving 2-bulb solar units. Rs. 11,00/- or 4-bulb unit worth Rs. 16,000/- to the branch as an incentive. This scheme has been able to promote environment consciousness and also convenience with both internal staff and enternal farmer customers.
Krishna Grameena Bank has introduced accident insurance with oriental insurance company in scheme called Krishna Jeevan Mitra S.B. A/c. A customer has to pay Rs. 15 per annum for insurance coverage of Rs. 25,000 and a minimum balance of Rs. 500 has to be maintained.
When some co-operative banks and RRB are reluctant to finance SGSY groups, KGB has taken special initiative to finance them but after ascertaining the quality of groups and productive purposes. Some groups have availed loan for purchase of tractor establishment of flour mill and preparation of pathroli leaves by using machines etc. It has been successful because the bank has identified the beneficiaries and released loans after careful appraisal.
Krishna Grameena Bank has entered into MoU with SB and Life and selling it super Surakash and Sudarshan policies as corporate agent since march 2003. This has given an additional net income of Rs. 1.5 crores to Krishna Grameena Bank and has brought extent customer loyalty to the bank.

In short, Krishna Grameena Bank has able to identify the needs of its customers at an appropriate time and design a user-friendly loan product, so that its is able to retain existing customers by strengthening the rapport with the bank and increase addition of new members by building public image at large.