Chapter 1
INTRODUCTION
1.1 INTRODUCTION TO THE STUDY
The Kerala State Financial Enterprises Limited, popularly known as KSFE, Is a Miscellaneous Non-Bankin Finance !ompany, !ompany, "ully owned #y the $o%ernment o" Kerala& It is one o" the most pro"it-makin pu#lic sector undertakins o" the State& Formed with the o#'ecti%e o" pro%idin an alternati%e to the pu#lic "rom the pri%ate chit promoters in order to #rin in social control o%er the chit "und #usiness, so as to sa%e the pu#lic "rom the clutches o" unscrupulous "ly-#y-niht chit "und operators& KSFE has #een reisterin impressi%e pro"its e%ery year, without "ail since its inception& This orani(ation study is carried out at KE)*L* ST*TE FIN*N!I*L ENTE)+)ISES,Thrissur&This study has #een carried out to et an o%er%iew o" the structure and "unctionin o" the orani(ation& The study was undertaken to et an eposure to the "unctionin o" di""erent departments o" the company and it helped to interact with the manaers o" di""erent departments and to o#ser%e the workers at their work place& This Study also "ocuses on the implementation o" !S) *cti%ities o" the "irm and analy(e the implementation o" !S) o%ernance rules as per the company act,./0 in the orani(ation&
1.2 OBJECTIVES OF THE STUDY o
o
To eplore the importance o" miscellaneous Non Bankin Institutions and their "unctionin& To understand the di""erent "inancial instruments 1 products used in a "inancial institution and the response o" the pu#lic on di""erent products
2 To understan understand d 1 study study the orani( orani(atio ation n structur structuree and the roles roles and responsi responsi#il #ility ity o" each indi%iduals workin in the company& 2 To understa understand nd the !S) polic policy y o" the "irm and %arious %arious acti%i acti%ities ties under undertak taken en #y the "irm&
1.3 RESEARCH METHODOLOGY This is a descripti%e study conducted mainly to "amiliari(e with the acti%ities, processes ,
policies ,prorams and procedure "ollowed in the "irm throuh primary and secondary data& +rimary data was collected mainly throuh o#ser%ation and inter%iews with the sta"" o" the "irm& +eople in%ol%ed in the !S) acti%ities o" the "irm a%e their "eed#ack as well& The secondary data collection sources includes materials like , *nnual )eport o" the Firm, 3arious research articles ,Newspapers and maa(ine& +u#lished articles and records in the "irm alon with the in"ormation a%aila#le in the company4s we#site came handy& handy&
1. SCO!E OF THE STUDY
The "ollowin #ulletin points will descri#e the important 5S!6+E7 o" the pro'ect conducted8 ➢ The data "or this pro'ect is collected "rom internet and "rom KSFE, Thrissur main
#ranch& ➢ The report eamines the Non Bankin Financial Industry de%elopment,eistence and
rowth in domestic en%ironment& ➢ To understand and to descri#e a#out the workin o" a "inancial company& ➢ This study will ela#orate the !S) policy adopted #y KSFE and the %arious acti%ities
carried out #y the committee&
1." LIMITA LIMITATION OF THE STUDY 2 9na# 9na#le le to o#tai o#tain n the the most most recen recentt data data&& 2 Many o" o" the respond respondents ents were were #usy and they they allowed allowed only only limited limited time time "or the the inter%iew& 2 Ina#ili Ina#ility ty to o#tain o#tain con"id con"ident ential ial data data 2 *#senc *#sencee o" enou enouh h 'ourn 'ournals als and pu#lica pu#licatio tions ns a#out a#out the "irm
CHA!TER 2 2 INDUSTRI INDUSTRIAL AL ANALYSIS ANALYSIS
2.1 INTRODUCTION TO NBFC NBF!s ha%e #een playin a complementary role to the the other "inancial institutions includin #anks in meetin the "undin needs o" the the economy& economy& They help "ill the aps in the a%aila#ility a%aila#ility o" "inancial ser%ices that otherwise occur in the un#anked : the underser%ed areas& NBF!s account "or /&0; assets o" the total "inancial system& *n NBF! is de"ined in terms o" Section <=I>c? o" the )BI *ct /@0< as a company reistered under the !ompanies *ct /@=A enaed in rantin loans1ad%ances or in the acuisition o" shares1securities, etc& or hire purchase "inance or insurance #usiness or chit "und acti%ities or lendin in any manner pro%ided the principal #usiness o" such a company does does not constitute any non-"inancial acti%ities such as >a? aricultural operations >#? industrial acti%ity >c? tradin in oods >other than securities? >d? pro%idin ser%ices >e? purchase, construction or sale o" immo%a#le property& property& The NBF! sement has witnessed witnessed considera#le rowth in the last "ew years and is now #ein reconised as complementary to the #ankin sector due to implementation o" inno%ati%e marketin strateies, introduction o" tailor-made products, customer-oriented ser%ices, attracti%e rates o" return on deposits and simpli"ied procedures, etc& NBF!s ha%e #een at the "ore"ront o" caterin to the "inancial needs and creatin li%elihood sources o" the so-called un#anka#le masses in the rural and semi-ur#an areas& Throuh stron linkae at the rassroots le%el, they ha%e created a medium o" reach and communication and are %ery e""ecti%ely ser%in this sement& Thus, NBF!s ha%e all the key characteristics to ena#le the o%ernment and reulator to achie%e the mission o" "inancial inclusion in the i%en time&
2.2 T#pe$ %& NBFI The etremely di%erse set o" entities in the Non-Bank Finance Institution >NBFI? uni%erse and their respecti%e reulators are shown #elow8
*s depicted a#o%e, )BI classi"ies NBF!s into ten cateories namely *sset Finance !ompanies>*F!s?, Loan !ompanies>L!s?, In%estment !ompanies >I!s?, In"rastructure
Finance !ompanies>IF!s?, !ore In%estment !ompanies>!I!s?, In"rastructure Ce#t Funds >ICF-NBF!s?, NBF!-Micro"inance Institutions >NBF!-MFIs?, Factorin companies>F!s?, Mortae $uarantee !ompanies >M$!s? and )esiduary Non- Bankin !ompanies>)NB!s?& NBF!s ha%e #een classi"ied on the #asis o" the kind o" lia#ilities they access, the type o" acti%ities they pursue, and o" their percei%ed systemic importance& L'a(')'t'e$ (a$e* +)a$$'&'+at'%, !ateory D*4 companies, >NBF!s ha%in pu#lic deposits or NBF!s-C?,!ateory DB4 companies, >NBF!s not ha%in pu#lic deposits or NBF!s-NC?& A+t'-'t# Ba$e* C)a$$'&'+at'%, Loan !ompanies >L!s?,In%estment !ompanies >I!s?, *sset Finance !ompanies >*F!s?,
In"rastructure Finance !ompanies >IF!s? and Systemically Important !ore In%estment !ompanies >!I!s-NC-SI?& S'e Ba$e* C)a$$'&'+at'%, non-deposit takin NBF!s with assets o" )s& /.. crore and a#o%e were la#elled as
Systemically Important Non-Ceposit takin NBF!s > NBF!s-NC-SI?, and prudential reulations such as capital adeuacy reuirements, eposure norms alon with, reportin reuirements were made applica#le to them&
2.3 MISCELLANEOUS NON BAN/ING COM!ANIES KSFE * Miscellaneous Non Bankin !ompany
Cirections #y )BI known as the 5Miscellaneous Non-Bankin !ompanies >)eser%e Bank? Cirections, ./A7&8 >/? !ollectin whether as a promoter, "oreman, aent or in any other capacity monies in one
lump sum or in instalments #y way o" contri#utions or su#scriptions or #y sale o" units, certi"icates or other instruments or in any other manner or as mem#ership "ees or admission "ees or ser%ice chares to or in respect o" any sa%ins, mutual #ene"it, thri"t, or any other scheme or arranement #y whate%er name called, and utilisin the monies so collected or any part thereo" or the income accruin "rom in%estment or other use o" such monies "or all or any o" the "ollowin purposes>a? i%in or awardin periodically or otherwise to a speci"ied num#er o" su#scri#ers as determined #y lot, draw or in any other manner, pri(es or i"ts in cash or in kind, whether or not the recipient o" the pri(e or i"t is under a lia#ility to make any "urther payment in respect o" such scheme or arranement >#? re"undin to the su#scri#ers or such o" them as ha%e not won any pri(e or i"t, the whole or part o" the su#scriptions, contri#utions or other monies collected, with or without any #onus, premium, interest or other ad%antae, howsoe%er called, on the termination o" the scheme or arranement, or, on or a"ter the epiry o" the period stipulated therein >? manain, conductin or super%isin as a promoter, "oreman or aent o" any transaction or arranement #y which the company enters into an areement with a speci"ied num#er o" su#scri#ers that e%ery one o" them shall su#scri#e a certain sum in instalments o%er a de"inite period and that e%ery one o" such su#scri#ers shall in his turn, as determined #y lot or #y auction or #y tender or in such other manner as may #e pro%ided "or in the areement #e entitled to the pri(e amount 0? !onductin any other "orm o" chit or kuri which is di""erent "rom the type o" #usiness re"erred to in su#-pararaph >? a#o%e >/? to >0?&
2. !ORTER0S " FORCES MODEL Barr'er$ t% e,tr# L%
Licensin reuirement8 The licensin reuirements o" )BI "or NBF!s are not that strinent as compared to the #anks& There are already //=@ reistered NBF!s while there are only around /G. #anks in India& Bara',', p%er %& +%,$45er$ H'h ●
Many alternati%es8 The consumers ha%e ot many alternati%es "or a%ailin credit& Lare num#er o" NBF!s8 The consumers ha%e a lare spectrum to choose "rom& ● Threat %& $4($t't4te$ M%*erate ●
Banks8 NBF!s were actually created #y the o%ernment o" India as it "elt the need to pro%ide #ankin "acilities to the poor and underpri%ileed who could not et access to #anks& Thus #anks are a per"ect su#stitute "or NBF!s& 9norani(ed money lenders8 The unorani(ed money lenders ha%e a stron presence in ● the rural markets& They pose a #i threat to the NBF!s in the rural areas& Bara',', p%er %& $4pp)'er$ H'h ●
Many alternati%es8 The suppliers in this case are the depositors or the NBF!4s "unds& The suppliers ha%e many alternati%es at their disposal to in%est their money dependin on their risk appetite& E8 Hih risk8 stocks, low risk8 #anks I,te,$'t# %& r'-a)r# H'h ●
●
●
9ndi""erentiated ser%ices8 The ser%ice o""erins #y NBF!s are almost the same& Thus there is a low le%el o" ser%ice di""erentiation& Marketin strateies8 Cue to the increased ri%alry amon the NBF!s, there has #een use o" aressi%e sellin : intensi%e marketin strateies #y the companies to ain the market share&
2." /EY GRO6TH DRIVERS /&$rowin per capita income )ural wae rowth is increasin, which will rural rowth& *lso, ood monsoons last years and the current eneral elections will increase spendin in rural areas& This in turn may lead to rowth in %ehicle and old loans "rom NBF!s& $rowin consumer credit market !onsumer credit market is promoted to increase #y A; "rom ./0 to ..& 0& +roduct inno%ation NBF!s are #uildin oranised pre-owned !3 >commercial %ehicle? sement, which is larely untouched #y #anks& NBF!s also "inance more than G. ; o" euipment leasin and hire purchase acti%ities in India& They currently ha%e .; market share in !3 "inance& *nother eample o" product inno%ation was creation o" an Islamic #ankin NBF! "irm in Kerala last *uust& <&+roduct customi(ation NBF!s structure monthly instalments while accountin "or the seasonality o" cash "lows in construction euipment loans& =&9se "or "osterin "inancial inclusion8
Focus o" NBF!s is on rural sement, Small and middle enterprises >SMEs? and Micro"inance NBF!s constitute almost A; o" the )s& /. #illion micr o"inance industries in India& NBF!s ha%e a lare rural network& The sector has #een reconised as complementary o" #ankin system #y introducin di%ersi"ication in the "inancial sector, simpli"ied sanction procedures, "lei#ility and timeliness in meetin the credit needs&
2.7 IM!ACT ANALYSIS NBF!s are already ame chaners in areas o" "inancial inclusion, especially micro "inance, a""orda#le housin, second hand %ehicle "inance, old loans and in"rastructure "inance& NBF!s can play a %ital role oin "orward, in closin the loop as reards "inancial inclusion "or indi%iduals and MSMEs& *s reards indi%iduals, NBF!s can reach %arious "inancial products o""ered #y the securities industry, %i(&, shares, mutual "unds, depository ser%ices etc&, as also insurance products #oth li"e and non-li"e toether with their current product o""erins& *s reards MSMEs, NBF!s can #ecome ame chaners #y pro%idin "actorin and #ill payment ser%ice which are o" critical importance at the present 'uncture&Howe%er, the new #anks and the in%itation o" "orein #anks into the Indian #ankin system >#y allowin the wholly-owned su#sidiary o" "orein #anks to acuire domestic pri%ate sector #anks as well as set up #ranches anywhere in the country? will increase competition "or NBF!s in rural areas, where they en'oyed unri%alled dominance& NBF!s ha%e a special responsi#ility aainst the #ackround o" the need to impro%e the customer ser%ice #y conductin their operations as per the #est practices o" corporate o%ernance& In the ultimate analysis, adherin to #est corporate o%ernance and ethical practices is the only way "or ainin the con"idence o" their customers in particular, and the society in eneral& !onseuently, the NBF! sector would #e a#le to arner reater trust o" #oth its customers and the society& That would pro%ide the sprin#oard "or increasin their #usiness le%els in the process o" "ul"illin their role as ame chaners in the areas mentioned
a#o%e& NBF!s #ecomin true ame chaners would #e a sweetener "or "inancial inclusion e""orts in our country&
CHA!TER 3
COM!ANY !ROFILE
/SFE TY!E
!UBLIC SECTOR
O6NED BY
GOVT. OF /ERALA
FOUNDED
7TH NOV. 1878
HEAD OFFICE
TRICHUR
NO. OF BRANCHES
ABOVE 1"
CHAIRMAN
A*-.!EELI!OSTHOMAS
MANAGING DIRECTOR
A.!URUSHOTHAMAN
INDUSTRY
FINANCE
!AID U! CA!ITAL
199 CRORES COVERED
BUSINESS TURNOVER
33:91 Cr; %, $ept.291<=
EM!LOYEES
7<:2
3.1 ORIGIN
In /@A, The $o%ernment o" Kerala took a policy decision to the e""ect that !hitties should #e conducted under state auspices as a means "or the collection o" small sa%ins& The then Finance Minister, in his #udet speech "or the "inancial year /@A-AG made the "ollowin announcement on the "loor o" the Kerala *ssem#ly& JI %iew this decision as a #old step "orward alon the path towards socialism, aimed at #rinin #anks and other "inancial institutions under social controlJ & *s the "ollow-up, the $o%ernment o" Kerala, appointed a Special 6""icer in the year /@A, to look into the "easi#ility and desira#ility o"startin !hit Funds in the pu#lic sector and also to prepare a comprehensi%e scheme "or startin !hits under o%ernment control 0& 6ne o"the o#'ecti%es o"startin !hit Funds in the pu#lic sector was to control the mushroom rowth o" pri%ate !hit Funds and to restrain their rowth #y o""erin e""ecti%e competition& The Special 6""icer, who presented his )eport on th 6cto#er /@A, recommended stronly the entry o" the $o%ernment into the "ield o" !hits& Thouh the recommendation was "or conductin !hit as an ad'unct o" the )eistration Cepartment, the $o%ernment took a di""erent %iew and decided to #rin within its pur%iew and control, not only !hitties or Kuries, #ut also certain other "inancial transactions "or which socialisation was "elt necessary& *ccordinly the $o%ernment decided to oranise a pu#lic sector undertakin with the name JThe Kerala State Financial Enterprises Ltd&J >KSFE? "or the purpose o" conductin !hits, hire purchase and insurance #usiness under $o%ernment control& This apart, the $o%ernment o" Kerala had a proressi%e %ision "or eneratin nonre%enue income throuh such pu#lic sector %entures& Thus, KSFE Ltd& was incorporated as a $o%ernment !ompany on Ath No%em#er /@A@ with its Hea d 6""ice at Trichur with the o#'ecti%e o" ser%in as a discipline "actor to pri%ate !hit FundsJ& The "irst Board o" Cirectors s was constituted as per $&6& >)t&?
3.2 CA!ITAL STRUCTURE OF /SFE The KSFE Ltd& is "ully owned #y the $o%ernment o" Kerala& The !ompany, which started in a hum#le manner with a paid up capital o" )s& Lakhs in /@A@, has now rown to )s&0.. Lakhs with a capital structure o" 0,..,... shares o" )s&l ..1- each "ully su#scri#ed #y the State $o%ernment& The other main resources on which the !ompany "inances its %arious schemes are8 /& Loans "rom the $o%ernment o" Kerala & Ceposits "rom the pu#lic and 0& Funds plouhed #ack "rom pro"it&
3.3 SCHEMES OF THE COM!ANY Beinnin with !hits, the !ompany has o%er the years introduced se%eral attracti%e schemes to cater to the needs o" di""erent classes o" people& Itmainly mo#ilises sa%ins #y instruments
like !hits and deposit schemes and channelises them to acuire house and household dura#les, motor %ehicles, euipment "or sel"-employment and pro%ides "inance "or aumentin workin capital needs o" small traders& The main schemes o" the !ompany as o" now are8 I& !hit scheme & +ass#ook loan 0& New !hitty loan <& Hire purchase scheme =& Hire purchase >House modernisation scheme? A& Employment oriented hire purchase scheme & $old loan scheme G& Trade "inancin scheme @& Fied deposit scheme /.& Suama deposit scheme //& New "ied deposit loan scheme /& New housin "inance scheme /0& )elia#le customer loan
3. OBJECTIVES OF THE COM!ANY The o#'ecti%es o" the company are listed in the Memorandum o" *ssociation o" the company& The important o#'ecti%es are as "ollows8
● T% $tart> +%,*4+t> pr%5%te> 5a,ae a,* +arr# %, the (4$',e$$ %& +h'tt'e$ ', I,*'a
%r e)$ehere. ● T% pr%5%te> 4,*erta?e> %ra,'e> +%,*4+t> 5a,ae a,* +arr# %, the (4$',e$$ %&
e,era) a,* 5'$+e))a,e%4$ ',$4ra,+e %& a,# ?',* ', I,*'a %r e)$e here ● T% $tart> pr%5%te> +%,*4+t> %perate> +arr# %, a,* 5a,ae the (4$',e$$ %& dealers,
agents and traders under the hire purchase system of arcles, -eh'+)e$> 5a+h',er#>
5ater'a)$> %%*$ a,* t%%)$ %& a)) +ap'ta) %%*$ a,* +%,$45er %%*$ a,* pr%pert# %& a)) ,at4re a,* *e$+r'pt'%, &%r per$%,a)>*%5e$t'+> %&&'+e> +%55er+'a)> ',*4$tr'a) a,* +%554,'t# 4$e a,* +%,$45pt'%, a$ a (4$',e$$ %& the C%5pa,# %r a$ ae,t$ %& the %-er,5e,t> $tate %r +e,tra) %r a,# (%*# %r %ra,'$at'%,> there@4,*er %r of any other Company..
To start, promote, conduct, operate, carry on and manae the #usiness o" dealers, aents and traders under hire purchase system o" articles, %ehicles, machinery ,materials oods and tools, o" all capital oods and consumer oods and property o" all nature and description "or personal, domestic, o""ice, commercial, industrial and community use and consumption as a #usiness o" the !ompany or as aents o" the $o%ernment, State or !entral or any #ody or orani(ation there under or o" any other !ompany& Besides these o#'ects, there are many other o#'ects, which is incidental or ancillary to the main o#'ects such as to ad%ance, deposit with or lend money, securities, property or to recei%e loans or rants or concession o" any nature or deposits "rom Banks, $o%ernment or $o%ernmental orani(ations or others&
3." VISION OF THE COM!ANY The %ision o" Kerala State Financial Enterprises is to #ecome a sini"icant player in the "inancial ser%ices sector #y8➢ +ro%idin a whole rane o" uality ser%ices and products& ➢ *doptin technoloy and #enchmark standards in customer ser%ice and per"ormance& ➢ Spreadin our wins #eyond the #orders o" Kerala, on a lo#al le%el& ➢ )etainin the pre-eminent role in !hitty #usiness& ➢ !ontinuin "ocus on etendin resources to the $o%t& o" Kerala& ➢ Sustainin commitment to the weaker sections o" society, as the neih#orhood
institution "or support, trust and security
3.7 MISSION OF THE COM!ANY ■ To #e leaders in our chosen sements& ■ To #e !ustomer !entric- SE)3IN$ the F)6NT Line& ■ To #uild a stron relationship with our employees, our customers and stake holder& ■ To #e o" ser%ice to the community in which we work and li%e in& ■ Empowerment o" women ■ To #e a $)E*T place to work ■ To #e a trusted, respected, nationwide, world class "ull ser%ice MNB!
3.< FINANCIAL !ERFORMANCE *t present KSFE has a urno%er o" 33801Cr. &Started with a paid up capital o" lakh company has reached to the landmark /.. crorow in a span o" <@ years& The rowth o" the company in the recent years are consolidated in the #elow ta#le.
$raphical representations o" the data are shown #elow8
CHA!TER ORGANIATION STRUCTURE
.1 ORGANISATION CHART
The orani(ational set up is a three-tier system "rom its %ery inception& with the Head 6""ice as the top controllin and coordinatin #ody, the )eions constitutin the intermediary le%el, coordinatin and controllin all the acti%ities o" the %arious #ranches under them and the #ranches at the #ase le%el as pro"it enerating centers
Athe Head Oce, the acvies are grouped on funconal as well as product basis under the control and supervision of the Managing irector.
.2 MANAGEMENT OF THE COM!ANY
The manaement o" the !ompany has #een %ested in the Board o" Cirectors constituted #y the $o%ernor "rom time to time& The num#er o" Cirectors shall not #e less than two and shall not #e more than "i"teen& The $o%ernor may "rom time to time appoint two Cirectors, other than the Manain Cirector as !hairman and 3ice-!hairman o" the Board and determine the period "or which either o" them will hold his respecti%e o""ice& The Board o" Cirectors as on No%em#er .. includes the !hairman, Manain Cirector and three other Cirectors holdin the o""ice as *dditional Secretary >Taes?, oint Secretary >Finance? and Inspector $eneral o" )eistration
CHA!TER " DE!ARTMENT !ROFILE
A= The *'&&ere,t *epart5e,t$ %& the Hea* O&&'+e are the &%))%', '.
B4$',e$$ Depart5e,t@
This is headed #y $eneral Manaer >Business? who is responsi#le "or all #usiness acti%ities o" the !ompany& ''.
F',a,+e Depart5e,t@
This department is headed #y the $eneral Manaer >Finance?& The main "unctions o" this department are plannin, #udetin and control, compilation o" accounts, reconciliation and preparation o" annual accounts, and controllin Ceposit Schemes o" the !ompany etc& iii&
A*5','$trat'%, Depart5e,t@
This is headed #y the C$M +: H) to #e in chare o" personnel administration , salary, industrial relations, man power plannin etc& i%&
Se+retar'a) Depart5e,t@
This department is headed #y the !ompany Secretary who is responsi#le "or the "unctions con"erred on him #y the !ompany4s *ct, /@=A& %&
Ge,era) A*5','$trat'%, Depart5e,t@
This department is headed #y one o" the senior o""icers o" the !ompany who will #e responsi#le "or the $eneral *dministration includin purchase, printin etc&
%i&
Lea) Depart5e,t @
This department is headed #y *$M >Leal? who is re sponsi#le "or all day to day leal matters&
-''.
I,ter,a) A4*'t Depart5e,t @
This department is headed #y the C$M >I*:3? assisted #y se%enteen audit teams to eercise internal check and control& *ll the a#o%e Cepartment Heads report directly to the Manain Cirector&
;B= The *'&&ere,t *epart5e,t$ %& the Re'%,a) O&&'+e
The acti%ities o" the )eional Manaers are rouped "unctionally as well as scheme wise& They are mainly responsi#le "or the proper and also healthy "unctionin o" the Branches and to #e in chare o" the o%erall rowth and de%elopment o" the Branches under their 'urisdiction&
The )eional
Manaers report directly to the $eneral
Manaer
Business and the $eneral Manaer Finance "or the respecti%e "unctions and to the Manain Cirector
relatin
to
the
other
"unctions&
)eional 6""ice are Business, *ccounts,
and
The
"unctional
de"ault
departments
o"
the
which corresponds to respecti%e
departments with "ocus on operational aspects
C= The *'&&ere,t *epart5e,t$ at U,'t$ )e-e)
*t the #ase le%el the 9nits are raded into three cateories %i(&
*
9nit
>i? >ii? >iii?
Ma'or Branches ha%in a chitty sala o" )s&. lakhs and a#o%e& Medium Branches ha%in a chitty sala o" )s&<. lakhs and a#o%e and Small Branches ha%in a chitty sala o" #elow )s&<. lakhs&
Head
%i(,
the
Manaer
heads
each
9nit
and
its
acti%ities
under *ssistant Manaer>s?1 Ceputy Manaer>s?& The 9nit Heads report
are
rouped
directly
to the
)eional Manaer and to the Cepartmental Heads in the Head 6""ice on matters pertainin to the departments concerned& In eceptional circumstances the 9nit Heads can report directly to the $eneral Manaer >Business?1 $eneral Manaer >Finance? and Manain Cirector&
The *'&&ere,t *epart5e,t$ ', the 4,'t are a$ &%))%$
1= C%))e+t'%, Depart5e,t
Assistant manager (collection) Assistant (cash) Assistant (FD/STD) Assistant (Sugama) Assistant (Auction)
Important "unctions o" collection department are ● )ecei%e money "rom customers ● $i%e receipt to customers ● Ensurin proper document "or e%ery receipt ● Entry o" transactions in the #ooks& ● Internal checkin ● Maintain e""ecti%e coordination with accountin department ● +reparin periodic collection report ● Sendin collection aents to collect money& ● To arrane "or the preparation o" chitty #alance sheets and its "ilin&
*n assistant
manaer will #e the head o" this department& She1he
monitors all
acti%ities
relatin to receipt o" cash and has the responsi#ility o" ensurin that there are no mistakes or
"rauds committed durin transactions& Ma'or decisions relatin to the receipts o" "unds are taken #y the *M !ollection& *ll sta"" in the collection department should report to him1her& She1he deleates responsi#ility to the sta"" under him1her&
2= A++%4,t$ Depart5e,t
Assistant manager (Accounts) Assistant (Loans / chitty price money payments) Assistant (book keeping)
Important "unctions o" accounts department are
● To #e responsi#le "or the remittance o" daily cash collection >includin the Money
6rder collection? and cheues in to the #ank on the date o" collection itsel" or latest #y the net workin day& ● To ensure once in e%ery "i"teen days that the cheues sent "or collection are either reali(ed or dishonored and the entries in the !heue Sent "or !ollection )eister are complete in e%ery respect& ● To ensure the writin up o" the Main !ash Book, to sin it and to check the postins o" $eneral Leder and to #e responsi#le "or the accuracy o" the postins& ● To eamine all the documents concerned with the payment o" pri(e amount and other ● +ayments and ensure that they are enerally in order and in particular ensure that all the amounts mentioned in the documents are accurate& ● To ensure satis"actory maintenance o" accounts in the #ranch, arrane the preparation o" all statements1 schedules relatin to the accounts and to render all returns relatin to *ccounts to the Head 6""ice1 )eional 6""ice& ● To ensure timely completion o" annual accounts and related statements&
3= Ge,era) A*5','$trat'%, Depart5e,t
Assistant Manager (general) Assistant (Loans / chitty price money payments) Assistant (!e" chitty registration) Assistant (collection agents)
Important "unctions o" eneral administration department are
● To initiate action "or the startin o" chitties in the Branch and to arrane the release o"
*d%ertisements& ● To assist the Manaer in can%assin su#scri#ers as and when necessary ● To issue %ariolas >application "orm "or 'oinin chitty? to the can%assin aents o" the Branch, maintain the *ents )eister and %eri"y the claims "or commission recei%ed "rom aents& ● To take steps "or the payment o" pri(e money to the pri(ed su#scri#er on the due date, i" the su#scri#er has "urnished adeuate security "or the payment o" "uture su#scriptions, and to intimate the "act to the pri(ed su#scri#ers& ● To %eri"y the enuineness1 lia#ility o" the su#scri#ers1 sureties& ● To #e responsi#le "or the entire personnel administration o" the Branch "or the proper maintenance o" *ttendance )eister, !asual Lea%e )eister and other lea%e accounts, personal "iles, ser%ice records1 #ooks , pro%ident "und records, loans, ad%ances and its repayment etc
=
Assistant Manager (Default) Assistant (Current efault) Assistant (Chronic efault)
De&a4)t &%))% 4p Depart5e,t
Important "unctions o" de"ault "ollow up department are
● Monitorin o" de"ault on a current #asis in all schemes o" the company& ● Initiatin necessary "ollow up action includin )), in cases o" chronic de"ault ● Timely preparations o" de"ault statements
"= Spe+'a) G%)* L%a, Depart5e,t
Assistant Manager (#ol loan) Assistant Appraiser
Important "unctions o" special old loan department are ● Speedy and e""icient dis#ursal o" $old Loan ● Sa"e custody o" ornaments pleded& ● Ce"ault monitorin o" the $old Loan scheme ● Initiatin auction steps in cases o" chronic de"ault&
● +reparation o" periodic schedules&
7= S#$te5$ Depart5e,t
Assistant Manager $mplementer
KSFE is passin throuh the in"ancy staes o" its computeri(ation process& The unit le%el systems department is now "ormed on an ad-hoc #asis& There is no eclusi%e assistant manaer
pro%ided
"or this "unction& $enerally any one o" the assistant
manaers who is in chare o" !ollection1 *ccounts1 Ce"ault is i%en additional responsi#ility to super%ise this "unction& $enerally, he is reuired to look a"ter issues related to so"tware 1 hardware 1 data entry errors etc and at the same time etent a helpin hand to other eneral acti%ities o" the #ranch& Important "unctions o" systems department are ● Ensure smooth "unctionin o" all the computer systems& ● )eportin so"tware errors1#us to Head 6""ice& ● Timely reportin o" hardware "ailures to the 3endor1*M! !ompany& ● Takin data #ack ups at the prescri#ed inter%als& ● +ro%idin in"ormation and assistance to other employees in matters related to system&
CHA!TER 7 CSR ACTIVITIES OF THE FIRM
7.1 INTRODUCTION TO CSR *ccordin to E9 commission >..?!S) is a concept where #y companies interate social and en%ironmental concerns in their #usiness operations and in their interaction with the
stakeholders on a %oluntary #asis& !S) is a concept with di""erent %iews all around the world& Many de"initions pre%ail and it has unclari"ied #oundaries& E%en thouh there are people who #elie%e that #usiness orani(ations ha%e nothin to do with social responsi#ility, leadin trend is the other way&A<; o" !E6s worldwide say that 5corporate social responsi#ility >!S)? is core to their #usiness rather than #ein a stand-alone proram7& They care a#out #uildin trust with consumers, partners, o%ernments, and their employees> >/@th *nnual $lo#al !E6 Sur%ey, ./A??& India stands out "rom the rest o" the world #ein the only country with leislated !S)& The new companies *ct ./0 that came into e""ect "rom *pril /, ./<, mandates that all companies, includin "orein "irms, with a minimum net worth o" )s =.. cr, turno%er o" )s /,... crore and net pro"it o" at least )s = crore, spend at least ; o" their pro"it on !S)&Thus has #een made mandatory under the new reulation and there are pro%isions o" penalties, in case o" "ailure& *lso, !S) disclosures is a ma'or component analy(ed in the I)BI>India )esponsi#le Business Inde? and in ./ SEBI made the su#mission o" these disclosures mandatory "or the top /.. companies listed in BSE& Indian reports shows an increase o" //; on the amount o" money spent on !S) acti%ities durin current year when compared to the pre%ious& The a%erae spendin per company has also increased #y /=;& >K+M$, ./A?This points to "acts, one8 Indian companies are ettin more "amiliar to the act& Two8 the concept o" !S) and its impacts are ainin more importance& This study concentrates on the !S) +olicy o" KSFE and the %arious !S) *cti%ities initiated #y them are analysed&!S) )eports o" the company pu#lished in the annual report is studied "or the year ./<-/= and ./=-/A&The Kerala State Financial Enterprises Limited, popularly known as KSFE, Is a Miscellaneous Non-Bankin Finance !ompany, "ully owned #y the $o%ernment o" Kerala& It is one o" the most pro"it-makin pu#lic sector undertakin o" the State&Formed with the o#'ecti%e o" pro%idin an alternati%e to the pu#lic "rom the pri%ate chit promoters in order to #rin in social control o%er the chit "und #usiness, so as to sa%e the pu#lic "rom the clutches o" unscrupulous "ly-#y-niht chit "und operators& KSFE #een reisterin impressi%e pro"its e%ery year, without "ail since its inception&
7.2 Lea) Ma,*ate &%r CSR ', I,*'a !orporate Social )esponsi#ility >!S)? assumes sini"icance as it permits companies to enae in pro'ects or prorams related to acti%ities related to social wel"are and impro%ement enlisted under the terms o" !ompanies *ct, ./0& There is an element o" "lei#ility in company acti%ities #y allowin them to select their pre"erred !S) enaements that are in areement with the o%erall !S) policy o" the company& A$ per $e+t'%, 13". C%rp%rate S%+'a) Re$p%,$'(')'t#
>1? E%ery company ha%in net worth o" rupees "i%e hundred crore or more, or turno%er o" rupees one thousand crore or more or a net pro"it o" rupees "i%e crore or more durin any "inancial year shall constitute a !orporate Social )esponsi#ility
!ommittee o" the Board consistin o" three or more directors, out o" which at least one director shall #e an independent director& >2? The Boards report under su#-section >3? o" section /0< shall disclose the composition o" the !orporate Social )esponsi#ility !ommittee& >3? The !orporate Social )esponsi#ility !ommittee shall, >a? "ormulate and recommend to the Board, a !orporate Social )esponsi#ility +olicy which shall indicate the acti%ities to #e undertaken #y the company as speci"ied in Schedule 3II >b? recommend the amount o" ependiture to #e incurred on the acti%ities re"erred to in clause >a? and >c? monitor the !orporate Social )esponsi#ility +olicy o" the company "rom time to time& >4? The Board o" e%ery company re"erred to in su#-section >1? shall, >a? a"ter takin into account the recommendations made #y the !orporate Social )esponsi#ility !ommittee, appro%e the !orporate Social )esponsi#ility +olicy "or the company and disclose contents o" such +olicy in its report and also place it on the companys we#site, i" any, in such manner as may #e prescri#ed and >b? ensure that the acti%ities as are included in !orporate Social )esponsi#ility +olicy o" the company are undertaken #y the company& >5? The Board o" e%ery company re"erred to in su#-section >1?, shall ensure that the company spends, in e%ery "inancial year, at least two per cent& o" the a%erae net pro"its o" the company made durin the three immediately precedin "inancial years, in pursuance o" its !orporate Social )esponsi#ility +olicy8+ro%ided that the company shall i%e pre"erence to the local area and areas around itwhere it operates, "or spendin the amount earmarked "or !orporate Social )esponsi#ility acti%ities8 +ro%ided "urther that i" the company "ails to spend such amount, the Board shall, in its report made under clause >o? o" su#-section >3? o" section /0<, speci"y the reasons "or not spendin the amount& Explanation&For the purposes o" this section 5a%erae net pro"it7 shall #e calculated in accordance with the pro%isions o" section /@G&
The "ollowin acti%ities can #e per"ormed #y a company to accomplish its !S) o#liations8 ● ●
Eradicatin etreme huner and po%erty +romotion o" education
● ● ● ●
● ● ●
●
+romotin ender euality and empowerin women )educin child mortality Impro%in maternal health !om#atin human immunode"iciency %irus, acuired, immune de"iciency syndrome, malaria and other diseases Ensurin en%ironmental sustaina#ility, Employment enhancin %ocational skills, social #usiness pro'ects !ontri#ution to the +rime Minister4s National )elie" Fund or any other "und set up #y the !entral $o%ernment or the State $o%ernments "or socio-economic de%elopment, and )elie" and "unds "or the wel"are o" the Scheduled !astes, the Scheduled Tri#es, other #ackward classes, minorities and women and such other matters as may #e prescri#ed&
9nder the terms o" !ompanies *ct, pre"erence must #e i%en #y companies in its !S) acti%ities to local areas and the areas where the company operates& !ompany may possi#ly also choose to link with or more companies "or "ul"illin the !S) acti%ities pro%ided that they are competent to report indi%idually& The !S) !ommittee will also prepare the !S) +olicy in which it includes the pro'ects and prorammes which is to #e undertaken, orani(e a list o" pro'ects and prorammes which a company plans to em#ark on durin the eecution year and also "ocus on interatin #usiness models with social and en%ironmental priorities and process "or the reason o" creatin share %alue& The company can in addition make the annual report o" !S) acti%ities in which they declare the a%erae net pro"it "or the 0 "inancial years and also appro%ed !S) ependiture #ut i" the company is not capa#le to spend the minimum reuired ependiture the company has to pro%ide the reasons in the Board )eport "or non-compliance so that there are no related penal pro%isions&
7.3 CSR !OLICY OF /SFE *? *IMS : 6BE!TI3ES 6F !S) !6MMITTEE >i? To de%elop a lon-term %ision and stratey "or KSFE4s !S) o#'ecti%es& >ii? Esta#lish rele%ance o" potential !S) acti%ities to KSFE4s core #usiness and create an o%er%iew o" acti%ities to #e undertaken, in line with Schedule 3II o" the !ompanies *ct, ./0& >iii?KSFE shall promote pro'ects that are 8 >a? Sustaina#le and create a lon term chane >#? Ha%e speci"ic and measura#le oals in alinment with KSFE philosophy >c? *ddress the most deser%in cause or #ene"iciaries& >i%? To esta#lish process and mechanism "or the implementation and monitorin o" the !S) acti%ities "or KSFE&
B? The !S) Team ha%e the "ollowin responsi#ilities8 >i? Formulate and recommend to the Board the !S) acti%ities1prorams to #e undertaken #y KSFE& >ii? )ecommend the !S) Ependiture to #e incurred on the !S) acti%ities1prorams& >iii? Institute a transparent mechanism "or implementation o" the !S) pro'ects and acti%ities& E""ecti%ely monitor the eecution o" the !S) acti%ities& >i%? +repare an annual report o" the !S) acti%ities undertaken "or KSFE and su#mit such report to the Board
!? )esponsi#ility o" Board& >i? *ppro%e the !S) +olicy and the !S) Ependiture a"ter takin into consideration the recommendations made #y the !S) committee& >ii? Ensure the !S) spendin e%ery "inancial year o" at least ; o" a%erae net pro"its made durin immediately precedin 0 "inancial years, in pursuance with the +olicy& >iii? Ensure that !S) acti%ities included in the !S) +olicy are undertaken #y KSFE and that such acti%ities are related to the acti%ities speci"ied in Schedule 3II o" the !ompanies *ct& >i%? Ensure disclosure o" the contents o" the !S) +olicy on the KSFE we#site& >%? Cirectors4 )eport "or F ./<-/= onwards to include8 >a? !ontents o" the !S) +olicy and !omposition o" the !S) committee >#? *n annual report on the !S) in the prescri#ed "ormat as per *ppendi- 0 >c? )easons "or "ailure >i" any? to spend reuired amount on !S) acti%ities& >%i? KSFE shall undertake the !S) acti%ities directly& The Board may, in the "uture, decide to undertake and implement its !S) acti%ities throuh a reistered trust or reistered society or a Section G company >Non-pro"it entity? esta#lished #y the KSFE $roup& In case the trust, society or a Section G company is not esta#lished #y the company or its holdin or su#sidiary or associate company, then such an entity will need to ha%e a 0 years track record o" undertakin similar pro'ects or prorammes& C? !S)Ependiture >i? In e%ery "inancial year, KSFE shall spend a minimum o" ; o" its a%erae Net +ro"its in the immediately precedin three >0? "inancial years& *%erae Net pro"its shall mean the net pro"its o" the !ompany as per the +ro"it : Loss Statement prepared in accordance with the !ompanies *ct, ./0 Net +ro"its shall eclude di%idend recei%ed "rom other companies in India& >ii? !S) Ependiture shall mean all ependiture incurred in respect o" speci"ic pro'ects1prorams
relatin to the appro%ed !S) acti%ities& >iii? !S) Ependiture shall not include ependiture on an item not in con"ormity or not in line with acti%ities which "all within the pur%iew o" the !S) acti%ities listed in Schedule 3II& >i%? !S) Ependiture shall not include +ro'ects or prorams or acti%ities undertaken outside India& >%? The surplus arisin out o" the !S) acti%ities or pro'ects shall not "orm part o" the #usiness pro"it o" KSFE&
>%i? !ontri#utions #y other KSFE a""iliates or employees may also #e recei%ed and utili(ed in respect o" the !S) acti%ities undertaken&
E? !S) +roects undertaken >/? KSFE shall promote !S) acti%ities1+ro'ects in the "ield o" 8 >i? Makin a%aila#le sa"e drinkin water in schools, collees, hospitals, selected %illaes etc& #y installin tanks and pipelines, diin #ore wells etc& >ii? *m#ulances to hospitals, pro%idin modern medical euipments and $ensets to hospitals and palliati%e care centres& >iii? +ro%idin wheel chairs, tricycle, scooters and supportin euipments to di""erently a#led people& >i%? Settin up old ae homes and support to orphaned 1 #lind students reuirements& >%? +romotin ender euality empowerin women etc& settin up e-li#rary "or the #ene"it o" students and others& >%i? Takin measures "or ensurin en%ironment sustaina#ility and conser%ation o" natural resources& >%ii? +romotion o" sports and support to national1international le%el players to participate in such e%ents& >%iii? !ontri#ute to the +rime Minister4s National )elie" Fund or any other "und set up #y the !entral $o%ernment "or socio-economic de%elopment and relie"& >? KSFE may also undertake other !S) acti%ities in line with Schedule 3II& >0? The !S) acti%ities shall #e undertaken in locations within India& KSFE shall i%e pre"erence to the local areas and the areas around which KSFE operates while considerin the acti%ities to #e undertaken and spendin the amount earmarked "or !S) acti%ities
F?Implementin !S) *cti%ities >i? The day to day implementation and eecution o" the !S) acti%ities1pro'ects shall #e carried out throuh a team constituted "or the purpose and headed #y the desinated 6""icer&
>ii? KSFE shall undertake the !S) acti%ities directly and also throuh %arious implementin aencies such as, N$64s, non-pro"it orani(ations, etc& Such implementin aencies shall ha%e an esta#lished track record as prescri#ed under the law& >iii? Some o" the initiati%es taken up #y KSFE will "acilitate the in%ol%ement o" KSFE employees as %olunteers in onoin pro'ects and e%ents, i%in them an opportunity to enae in socially meanin"ul acti%ities, thus, ena#lin them to reali(e their "ull potential and role as socially responsi#le citi(ens >Employee 3olunteer +rorams?& >i%? The initiati%es undertaken may #e communicated to the employees throuh speci"ic awareness campains, so as to ena#le maimum participation& >%?KSFE may also colla#orate or pool resources with other companies to undertake !S) acti%ities in such a manner that each companies are in a position to report separately on such !S) pro'ects >%i? The "ollowin acti%ities do not uali"y as !S) *cti%ities under the !ompanies *ct, ./08 >a? +ro'ects or acti%ities not "allin within Schedule 3II >*ppendi /? >#? *cti%ities undertaken in pursuance o" normal course o" #usiness >c? +ro'ects or prorams or acti%ities that #ene"it only the employees o" KSFE and their "amilies >d? Cirect or indirect contri#ution to any political party& $? KSFE-!S) Team !apa#ilities KSFE may #uild and enhance the !S) capa#ilities and skills o" its own personnel throuh institutions with esta#lished track record o" minimum three "inancial years& The ependiture shall not eceed =; o" the total !S) ependiture o" KSFE in one "inancial year
H? !S) )eportin The Board in its *nnual )eport shall include the details o" the !S) acti%ities undertaken in the Financial ear& The !S) !ommittee shall pro%ide a responsi#ility statement on the implementation and monitorin o" the !S) +olicy and that it is in compliance with !S) o#'ecti%es o" KSFE, which statement shall "orm part o" the Boards4 )eport&
I? )e%iew and *udit The !S) committee shall #e apprised on the implementation o" the !S) acti%ities and the proress shall #e monitored on a uarterly #asis& KSFE shall throuh its internal controls, monitorin and e%aluation systems implement, assess, document and report the impact o" its !S) acti%ities1pro'ects& )ecords relatin to the !S) acti%ities and the !S) Ependiture shall #e meticulously maintained& The )ecords shall #e su#mitted "or reportin and audit& The "inancial audits o" the implementin aencies >where%er applica#le? shall also #e done throuh periodic audits& In this reard, KSFE may appoint independent eternal consultants
"or carryin out such audits& /<& *MENCMENTS The +olicy may #e re%iewed and amended "rom time to time #y the Board su#'ect to the pro%isions o" !ompanies *ct ./0&
?!S) *nalysis "or past years !art'+4)ar *%erae Net +ro"it o" the company "or the last three "inancial years +rescri#ed !S) Ependiture>; o" a#o%e amount? *mount outlay "or !S) *cti%ities *mount spent in "inancial year
291@1" 0&A crores /&< crores /<@@<< @@G<.
291"@17 /AG crores 0&0< 0
./<-/= For the year ./<-/= more than =. ; o" the "und was allocated to the upli"ment and #etterment o" health "acilities o" the state&The least amount o " "und is allocated to the en%ironment related acti%ities in the "irm&*lthouh the num#er o" pro'ects included in the education sector is hih compared to the others, the amount allocated is .&=A; o" the total "und&
./=-./A Fund allocation "or %arious sector in the ./=-/A #udet o" !S) *cti%ities&
./<-/= The num#er o" pro'ects taken to promte di""erent sectors throuh !S) *cti%iites&
+ro'ects under Health includes8 )ural de%elopment and health care& *m#ulances to hospitals, pro%idin modern medical euipments and $ensets to hospitals and palliati%e care centres& +romotin pre%enti%e health care and sanitation
./=-/A The num#er o" pro'ects taken to promte di""erent sectors throuh !S) *cti%iites&
+ro'ects under )eha#ilitation includes8 Settin up old ae homes and support to orphaned 1 #lind students reuirements& >%? +romotin ender euality empowerin women etc& settin up e-li#rary "or the #ene"it o" students and others +ro'ects under En%ironment includes8 >i? Makin a%aila#le sa"e drinkin water in schools, collees, hospitals, selected %illaes etc& #y installin tanks and pipelines, diin #ore wells etc&
CHA!TER < S6OT ANALYSIS
S6OT ANALYSIS Stre,th 1. 2. 3. . ". 7. <.
S4pp%rt> Tr4$t a,* Se+4r't# !r%*4+t Var'et# !re@e5',e,t R%)e ', Ch'tt# B4$',e$$ Ete,*', Re$%4r+e$ t% the G%-t. %& /era)a 4a)'t# Ser-'+e$ a,* !r%*4+t$ Str%, C4$t%5er Ba$e A*%pt', Te+h,%)%# a,* Be,+h5ar? Sta,*ar*$
Core Values of the Firm ,which includes: Integrity – work ethics Teamwork- One Team - One Dream Oera!onal " #$ecu!on #$cellence
%assionate Ownershi " Taking accounta&ility
Customer
Centricity 'Trust is the ifferentiator% The organisation is mainly inulge in chit business& 'eing a public sector enterprise unlike other priate players in the chit business *SF+ is transparent an trust"orthy Esta#lishment o" KSFE in
/@A@ was to sa%e common people "rom the clutches o" unscrupulous "ly-#y-niht chit "und operators with all these years KSFE has rown in to a "inancial super market openenin doors to all classes o" people o" society& KSFE is also workin on products to attract youth and all sements o" society includin N)Ks>Non )esidential Keralites? with in !hitty Fund *ct >!F*? /@G and Forein Echane Manaement *ct >FEM*?& *s per KSFE MC,oshy paul JOe are also on this path o" rowth and all o" our #ranches will #e connected #y !ore Bankin solution!entrali(ed *ccountin So"tware "or Business *pplication >!*SB*? within si months >/G/ #ranches are already connected?& E-!ollection, Net-throuh payment are already esta#lished in top locations& Oe are also on the way o" pro%idin the "acility o" on-line auction in chits so that a customer can participate in chit auction "rom anywhere in the world& The concept o" %irtual #ranch is also under consideration&J KSFE has many products desined to meet the "inancial needs o" all sort o" society& KSFE achie%ed and eceeded its #usiness #udet throuh #randed !hits& For the current "inancial year also, KSFE launched #randed !hit named 5+6NN6N* !HITTIK*L ./A7 "or 6N*M "esti%al season&Suama Ceposit scheme Coesn not ha%e distur#in amount o" Non +er"ormin *sset since its dues en'oy the status o" a re%enue reco%ery, #ein an arm o" the State $o%ernment& Tie up with insurance and western union money helps to attract more customers&
6ea?,e$$ The #usiness per"ormance o" the !ompany hihlihts the need "or achie%in still hiher rowth rate in "uture& *lthouh the !ompany has #een makin pro"its throuhout the period, the pro"ita#ility ratio shows "luctuations and the epense ratio shows that only a small marin is le"t a"ter meetin the epenses& The de"ault record is hih and re%enue reco%ery per"ormance is not satis"actory& The outreach o" the !ompanys ser%ices to the rural masses seems not satis"actory as shown #y the lesser proportion o" rural #ranchs& The analysis o" the per"ormance o" KSFE on the #asis o" %arious parameters re%eals its %ia#ility and areas o" its success and "ailures& Some o" the o#'ecti%es o" the !ompany at the time o" its incorporation are yet to #e achie%ed& The continued presence o" the in"ormal and unreistered !hit Fund sector pinpoints the need "or more dynamic rowth "or KSFE and wider market outreach& The scarcity o" rural #ranches, the dearth o" inno%ati%e schemes, di%ersi"ication o" eistin schemes, lack o" pu#lic awareness on the special pri%ilees en'oyed #y KSFE, insu""icient customer care and comparati%ely poor uality in the deli%ery o" ser%ices pose threats to the reputation o" the !ompany& Hierarchical structure o" administration causes delay in decision-makin and a""ects the speedy operation& Insu""icient customer ser%ice and delay in the payment o" pri(e money tarnishes the imae and reputation o" the !ompany, despite its sa"ety aspect& *#sence o" computerisation creates operational di""iculties&
Opp%rt4,'t'e$ /&)BI )ule allowin NBFIs to )oll out white-la#el *TMs&I" esta#lsihed in all ma'or ur#an and semi-ur#an #ranches would de"initely increase its reach in the state& &Ser%ice o""erins #y NBF!s are almost the same& KSFE has the Trust "actor as di""erentiator& *s the company is doin more !S) *cti%ities and "ollows a sound !S) +olicy& It can #e used as a di""erentiatin "actor& 0&$rowin consumer credit market <& )ural wae rowth is increasin&This in turn may lead to rowth in %ehicle and old loans "rom NBF!s =&+roduct inno%ation and +roduct customi(ation&The more research is done in makin inno%ati%e products the more will #e the success o" the "irm& A&*d%anced !redit Scorin models that incorporate non traditional data ha%e the potential to etend lendin to Indias creditworthy yet "inancially ecluded population& &In%estin in technoloy and analytics to achi%e the "ull oal o" "inancial inclusion& G&$round-le%el understandin o" their customers4 pro"i le and their credit needs i%es them an ede, as does their a#ility to inno%ate and customise products as per their clients4 needs& @&6noin stress in the pu#lic sector #anks due to mountin #ad de#t&Ina%aila#ility o" lendin "or rural areas& /.&Ciital disruption, especially "or micro, small and medium enterprises >MSMEs? and small and medium enterprises >SMEs? //&Increased consumption,rise in income,rise in middle class&
Threat$ /& & 0& <&
The continued presence o" the in"ormal and unreistered !hit Fund sector& Low Barriers to Entry in to the Industry& Barainin +ower o" consumers is hih& Introduction o" new schemes has #een delayed due to the inter"erence o" stron la#our unions =& Threats o" Su#stitutes,9noranised Money lenders and other pri%ate "iannce "irms oin diital pro%idin #etter ser%ice& A& *ressi%e sellin : intensi%e marketin strateies #y other companies to ain the market share& & +roduct inno%ation #y other companies&e Islamic #ankin NBF! "irm&
CHA!TER : FINDINGS AND SUGGESSIONS
FINDINGS AND SUGGESTIONS
FINDINGS
This study has analysed the "irm and ha%e done its SO6T analysis&Indeed the "irm has many strenths and opportunities in its way to increase its rowth in the comin years&*part "rom that,the study on !S) acti%ities o" the "irm draws out %arious "indins that is summarised here& KSFE has well implemented the !S) policy as per the !ompany4s act,./0&!ompany ha%e "ormulated a !S) committee "or carryin out the csr acti%ities o" the "irm&!ompany has recorded properly the recorded the !S) acti%ities o" the "irm in the annual report in well de"ined manner &!ompany is una#le to spent the eact amount as per the #udet "or the "inancial year althouh it is compensated in the consecuti%e year&!ompany spends the entire amount directly to the cause,with out the help o" any 0 rd parties&
SUGGESTIONS
Suestions "rom this study is to impro%e the per"ormance o" the "irm #y concentratin on the strenth and opportunities o" the "irm&*lso o%ercomin the weekness and preparin intelliently "or the threats would help the company ain more leaps&*part "rom this,"rom the study o" !S) acti%ities o" the "irm,the "ollowin suestions are listed down to impro%e the per"ormance o" the acti%ities& !lu##in with N$64s and other socio help roups would increase the reach
o" the pro'ects&In%ol%ement o" Employees and customers o" the "irm will increase the credi#ility o" the *cti%ities o" the "irm!ompany should "ind and take up more reional pro'ects to help the society in real sense&+ro'ects related to en%ironment and pollution should #e taken up more seriously as it is a #urnin issue and a""ect the weaker part o" the society the more&In%ol%ement o" school and collee students will also increase awareness and do help "or the #etterment o" the society in "uture&
CHA!TER 8 CONCLUSION
CONCLUSION BF!s ha%e #een playin a complementary role to the other "inancial institutions includin #anks in meetin the "undin needs o" the economy&The Kerala State Financial Enterprises Limited, popularly known as KSFE, Is a Miscellaneous Non-Bankin Finance !ompany, "ully owned #y the $o%ernment o" Kerala&It has a ood pro"it makin record with lare market share in Kerala&*lso the statistics shows the increase in pro"it throuhout the years&The orani(ational set up in KSFE is a three-tier system "rom its %ery inception& with the Head 6""ice as the top controllin and coordinatin #ody, the )eions constitutin the intermediary le%el, coordinatin and controllin all the acti%ities o" the %arious #ranches under them and the #ranches at the #ase le%el as pro"it eneratin centers&The manaement o" the !ompany has #een %ested in the Board o" Cirectors constituted #y the $o%ernor "rom time to time&There are di""erent departments in Head o""ice,reional o""ice and unit le%el o""ices o" the "irm&KSFE has implemented !S) policy as per the leal reuirements in the country and carries out decent amount o" !S) acti%ities& This study has pointed out the strenth ,weakness opportunities and threats related to the "irm&The manaement should "ocus on the strenth and opportunities o" the "irm alon with o%ercomin its weakness and threats&
CHA!TER 19 BIBLIOGRA!HY
BIBLIOGRA!HY ➢ Moshal B&S& >./.? , +rinciples o" Manaement, *nne Books +%t& Ltd& ➢ +andey I&M& >../?, Financial Manaement, 3ikas +u#lishin House +%t& Ltd& ➢ https811r#i&or&in1scripts1BSP3iewBulletin&aspQIdR/<00 ➢ https811r#idocs&r#i&or&in1rdocs1noti"ication1+CFs1
➢ ➢ ➢ ➢
FE@CB0=/.&+CF http811pop&ks"e&com1downloads1presentationPks"ePmd&pd" http811shodhana&in"li#net&ac&in1#itstream1/[email protected];.<&pd" https811economictimes&indiatimes&com1topic1KSFE https811www&deccanchronicle&com1nation1in-other-news1/@.A/A1pri%ate-chits-tap-into-
kerala-state-"inancial-enterprises-share&html ➢ OOO&KSFE&!6M ➢ Shyam )eena>./A? *N *N*LSIS 6F !6)+6)*TE S6!I*L )ES+6NSIBILIT
IN INCI*,Internation 'ournal 6" )esearch $ranthaalayah <>=?,=A-A< ➢ Mukheri *#hishek >./A? *nalysis o" mandatory !S) ependiture in India8 a sur%ey,
International 'ournal o" corporate o%ernance >/?80 - =@ ➢ Mukheri *#hishek >./A? *nalysis o" mandatory !S) ependiture in India8 a sur%ey,
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