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Article
Publication date: 1 January 2013

Sunildro L.S. Akoijam

The purpose of this paper is to analyse the issues and concerns of Indian rural credit, which is a powerful tool for enhancing production and productivity and for poverty…

3659

Abstract

Purpose

The purpose of this paper is to analyse the issues and concerns of Indian rural credit, which is a powerful tool for enhancing production and productivity and for poverty alleviation. Further it highlights some of the strategies adopted by Reserve Bank of India (RBI) to increase the rural credit facilities in the rural area of India.

Design/methodology/approach

The various tools of rural credit are analysed in detail. The Regional Rural Bank (RRB) who play a vital role in increasing the rural credits is studied. Self Help Group (SHG)‐Bank Linkage model of NABARD which creates an interface of the informal arrangements of the poor with the banking system is also analysed in detail.

Findings

Rural credits serve as a tool for providing a sustainable livelihood for millions of rural Indians who don't have a means of livelihood. Several organisations like RRBs, Microfinance Institutions, NABARD, etc. are playing a major role in providing rural credit facilities to rural India. Reserve Bank of India (RBI) is formulating and regulating the policies and procedure to make the rural credit facilities available to most of the needy. In spite of several efforts put up by various organisations to increase the rural credit facilities, several challenges will prevail in the years to come.

Originality/value

These aspects of the financial sector remain undervalued in mainstream literature on rural credit. With India being a nation in which more than 70 percent of people live in rural areas and rural credit being a powerful, and the only, tool for rural people in providing a means of livelihood, its importance and potential should be known to each individual.

Details

International Journal of Social Economics, vol. 40 no. 1
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 16 June 2021

Sukanya Panda

This study aims to test a model in which the effect of strategic information technology (IT)-business alignment capability (hereafter referred to as “strategic alignment”) on…

1292

Abstract

Purpose

This study aims to test a model in which the effect of strategic information technology (IT)-business alignment capability (hereafter referred to as “strategic alignment”) on organizational performance is examined via the mediating role of organizational agility [studied as operational adjustment agility (OAA) and market capitalizing agility (MCA)] along with the moderating influence of environmental uncertainty.

Design/methodology/approach

The research uses survey data accumulated from 220 managers (IT and bank managers) working in the regional rural banks of Odisha, India. A structural equation modelling approach is used to investigate the strategic alignment-performance relationship.

Findings

The findings demonstrate the positive effect of strategic alignment on agility (studied as OAA and MCA). This paper finds the positive effects of strategic alignment and both OAA and MCA on organizational performance. The moderation analysis reveals that in an uncertain environment, strategic alignment has more impact on MCA than OAA. However, the test of mediation exhibits OAA as a more significant mediator promoting the strategic alignment-performance linkage, than MCA. This was further validated from the moderated-mediation analysis.

Originality/value

Although previous research studies (mostly conducted in the context of developed countries) have reported about the positive strategic alignment-agility-performance linkages, yet the literature is silent regarding the influence of external contingent factors on these relationships from a rural banking perspective in a developing country setting (such as India). The research extends the strategic alignment-agility-performance theories and provides empirical support for these unique associations in the context of rural banking in India and thereby, greatly contributes to the existing strategic alignment literature.

Details

Journal of Asia Business Studies, vol. 16 no. 1
Type: Research Article
ISSN: 1558-7894

Keywords

Article
Publication date: 26 July 2021

Sakshi Khanna and Manoj Gaur

Banks in India have started opening their branches in different areas to make sure that their customers get a high-touch experience and they see them as a premier brand. This…

Abstract

Purpose

Banks in India have started opening their branches in different areas to make sure that their customers get a high-touch experience and they see them as a premier brand. This could be ensured only if the banks show a stable physical presence in the market as well as provide the recent high-tech services to their customers as per the population group. The purpose of this study is to examine the survival rates of the commercial banks in India across the four population groups along with the differences that exist in their survival rates in all the population groups.

Design/methodology/approach

The analysis is based on the quarterly data of the number of functioning offices of the commercial banks in India as per the four population groups from March 2006 to December 2019. The survival is estimated using the Kaplan–Meier estimator.

Findings

From the analysis, it is revealed that survival of the banks changes as per the population group. In addition to this, it is found that the survival time of each category of the bank varies in each population group.

Research limitations/implications

This study focuses only on the commercial banks of India; a similar research could be done for other categories of Indian banks. Also, the results would have been different if the variables such as the size of the bank, bank risk, etc. are included and studied. Moreover, this study is done using the Kaplan–Meier estimator, i.e. time-to-event. Further, an advance study could be done after considering the financial parameters of banks using the Cox’s regression model, which explores the relationship between various predictors and the time-to-event.

Social implications

Due to the changes in the preferences of societies, the banks should also adopt different strategies to ensure that their products are understood and accepted by their customers. This will eventually increase the survival rate of the banks.

Originality/value

The work made in this study is completely new.

Open Access
Article
Publication date: 2 September 2022

Sulagna Das

This paper aims to find out the performance of the Grameen Banks of West Bengal after their merger.

Abstract

Purpose

This paper aims to find out the performance of the Grameen Banks of West Bengal after their merger.

Design/methodology/approach

The objective of the paper is to measure the performance of Paschim Banga Gramin Bank (PBGB) and Bangiya Gramin Vikash Bank (BGVB) after their amalgamation, to compare the performance of PBGB and BGVB, using the key performance indicators and to analyze the future scope of these two banks. The factors that are considered for this study are number of branches (if these banks could reach maximum of the rural mass), number of staffs (if these banks generated employment after the merger), investments, deposits, composition of total funds (owned funds and borrowed funds), lending services, productivity per branch and per staff, etc. The study uses statistical tools to analyze the data.

Findings

It has been observed that there exists a significant difference in the “Branch Network” of PBGB and BGVB. A significant difference has been observed in the “Number of Staffs” of PBGB and BGVB. It has been found that there is a significant difference in the “three type of funds” of PBGB and BGVB. It has been found that there is a significant difference in the “Investments” of PBGB and BGVB. A significant difference has been observed in the “Deposits” of PBGB and BGVB. It has been found that there is a significant difference in the “Outstanding Loan” amount of PBGB and BGVB. It has been observed that there is a significant difference in the “Loan Issued” amount of PBGB and BGVB. It has been found that there is no significant difference in the Productivity “Per Branch” and “Per Employee” of PBGB and BGVB.

Research limitations/implications

The study is based on the published/secondary data and is restricted to two Regional Rural Banks of West Bengal, the PBGB and the BGVB, for nine years, 2012–2020.

Social implications

The paper will help the future researchers, to know the performance of the Grameen Banks for the study period; this will help them to carry on with the study in the future.

Originality/value

The work is original and never sent to anywhere else for publication.

Case study
Publication date: 23 September 2016

Dhananjay Bapat, S. Sidharthan and C. Yogalakshmi

Financial Services Marketing, Financial Inclusion, Emerging Market Studies.

Abstract

Subject area

Financial Services Marketing, Financial Inclusion, Emerging Market Studies.

Study level/applicability

The case is suitable for graduate management students in courses such as general management and marketing courses. It is also suitable for a specialised rural marketing course and marketing of financial services. In business schools outside India, the case can be used in a course on marketing strategies for emerging economies. The case is suitable for executive development programmes for the areas pertaining to rural banking, marketing of banking services and financial inclusion programmes.

Case overview

The case analyses the financial inclusion initiative by Odisha Gramya Bank, a regional rural bank set up after amalgamation of three banks in the state of Orissa, India. The topic of financial inclusion has been the attraction from bankers, policymakers and academia in light of linkage between formal financial system and inclusive growth. To harness the fortunes at the bottom of pyramid, the case looks into the development of financial inclusion, business strategies and strategies for various customer segments.

Expected learning outcomes

To introduce students to analyse and compare various financial inclusion options. The case is useful to comprehend the various methods of financial inclusion. To analyse the evolution of regional rural banks and Odisha Gramya Bank after its amalgamation. To appreciate the issues faced by Odisha Gramya Bank. To understand various market segment and to evaluate its potential. To suggest appropriate strategies for each market segment. To appreciate how technology can be harnessed for business correspondents. To recommend the roadmap for financial inclusion to Mr Sidharthan, Chairman, Odisha Gramya Bank.

Supplementary materials

Teaching notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Subject code

CSS 8: Marketing.

Details

Emerald Emerging Markets Case Studies, vol. 6 no. 3
Type: Case Study
ISSN: 2045-0621

Keywords

Article
Publication date: 15 August 2018

Dipasha Sharma, Sonali Bhattacharya and Shagun Thukral

This study attempts to critically assess one of the financial inclusion policy “Pradhan Mantri Jan Dhan Yojna” introduced by the government of India in 2014.

Abstract

Purpose

This study attempts to critically assess one of the financial inclusion policy “Pradhan Mantri Jan Dhan Yojna” introduced by the government of India in 2014.

Design/methodology/approach

Number of bank accounts opened (rural, urban and overall) under the policy, total balance in such account and total number of debit cards issued till October, 2017 were taken as the criterion variables. The macroeconomic indicators, infrastructure, literacy, regional dummy and percentage labour participation were taken as predictors. Finally, a State index for financial inclusion under the policy was developed through Normalized Inverse Euclidean Distance using per capita number of accounts, total balance and number of debit cards issued as the parameters.

Findings

Andaman and Nicobar, Puducherry and Chandigarh came out to be the top three State indexes for Financial Inclusion under the policy. Status of infrastructure (such as number of roads) was found to be the most significant determining factor. Other factors were labour force participation, poverty and regional disparity.

Originality/value

This paper is unique in the sense that financial inclusion policy has been assessed both through its reachability and assessment of its predictors.

Details

International Journal of Ethics and Systems, vol. 34 no. 3
Type: Research Article
ISSN: 0828-8666

Keywords

Article
Publication date: 6 February 2019

Joyce Patience Awo and Joseph Oscar Akotey

Rural and community banks (RCBs) provide financial services to small enterprises in rural and sub-urban areas. The purpose of this paper is to examine their financial performance…

1008

Abstract

Purpose

Rural and community banks (RCBs) provide financial services to small enterprises in rural and sub-urban areas. The purpose of this paper is to examine their financial performance through a case-specific evaluation of a small bank situated in the northern part of Ghana.

Design/methodology/approach

The authors employed a triangulation method comprising relative ratio analysis, bivariate and generalized method of moments (GMM) techniques for the evaluation of the audited annual financial statements of the bank covering a period of 15 years.

Findings

The relative ratio analysis show that the bank's financial performance has generally been above the average of the rural banking industry. The bivariate analysis indicates that although the loans portfolio is positive, it is not properly fitted. That is, some of its loan portfolio deviates from the path of expectation. The GMM analysis indicates that its financial performance is significantly influenced by liquidity management, bank capital and size which have enhanced its expansion and intermediation to rural households and microenterprises. However, an increase in the government treasury bill rate has a declining effect on the bank’s profitability.

Practical implications

The findings have significant policy implications for the management and supervision of RCBs. RCBs should deal with the spillover effects of the banking and MFIs’ crisis by educating and re-assuring their customers of their financial integrity. Most importantly, they differentiate their services from the other financial institutions within the space of the rural financial architecture.

Originality/value

Majority of research into this area has focused heavily on large commercial banks. This research adds value to the literature by re-focusing the searchlight on the financial performance of small banks.

Details

World Journal of Entrepreneurship, Management and Sustainable Development, vol. 15 no. 1
Type: Research Article
ISSN: 2042-5961

Keywords

Article
Publication date: 31 May 2021

Jessy Nair and Mohith Kumar Jain

The purpose of this study is twofold: first, to develop a framework to implement electronic delivery systems for connecting federal government with rural citizens using banking

Abstract

Purpose

The purpose of this study is twofold: first, to develop a framework to implement electronic delivery systems for connecting federal government with rural citizens using banking infrastructure as a reintermediation platform; and second, to understand the challenges faced by banks in reintermediation for financial inclusion (FI).

Design/methodology/approach

This exploratory research adopts case study method to gain insights of the challenges faced by banks in e-government services for FI. In-depth structured interviews are conducted with key respondents: branch managers heading banks in rural areas.

Findings

Preliminary results based on in-depth interviews with branch managers of banks suggest that banks leverage facilitators called Bank Mitras (BM) (friends from bank as per the local language) to disseminate services offered by the banks to rural customers at each village. However, a key challenge faced by banks is the increased dependency on bank employees to complete the process of e-government transactions by the beneficiaries because of trust factor.

Research limitations/implications

This exploratory research builds on the case study approach using in-depth interviews with the branch managers of five banks as key respondents to develop the preliminary research framework for FI.

Practical implications

Policymakers can design banking systems to enhance transparency by implementing technologies and decentralizing routine transactions to citizens by enhancing the role of facilitators (BM).

Social implications

FI aims to reach out and empower citizens with banking facilities for disbursing e-government services. This process needs to be refined for the rural population of India to understand and better use the e-government services and schemes.

Originality/value

Insights from in-depth interviews with key respondents of the banks were collated and augmented with literature to enhance the rigor of the exploratory research.

Details

Journal of Asia Business Studies, vol. 16 no. 2
Type: Research Article
ISSN: 1558-7894

Keywords

Article
Publication date: 28 March 2023

Sandhya Garg and Samarth Gupta

Financial access is key to achieving several economic goals in developing countries. This paper aims to construct a longitudinal village-level measure of financial access in India…

Abstract

Purpose

Financial access is key to achieving several economic goals in developing countries. This paper aims to construct a longitudinal village-level measure of financial access in India and understand the role of RBI's policies and village characteristics in influencing the access.

Design/methodology/approach

The authors adopt a spatial approach in developing a metric of financial access. In particular, they measure the distance of each unbanked village in India to the nearest banked-centre from 1951 to 2019. The authors use this measure to conduct two exercises. First, a descriptive study is undertaken to assess how RBI's policies on bank branch expansion from 1951 to 2019 influenced the proximity to bank branches. Second, the authors conduct regression analyses to investigate how socio-economic and demographic characteristics of villages influence their proximity to bank branches.

Findings

The average distance of an unbanked village to the nearest banked-centre has declined from 43.5 km in 1951 to 4.2 km in 2019. The gain in bank access has varied geographically and over time. In 2001, bank branches were relatively distant from villages with under-privileged caste groups and proximate to areas with better infrastructure. This relationship worsened after 2005 when RBI introduced liberalized branch expansion policies. By 2019, proximity responds much more adversely to the presence of underprivileged groups. At the same time, banks have moved closer to economically better-off villages and villages with workforce in non-farm enterprises rather than agriculture.

Originality/value

First, studies in the Indian context focus on state-level determinants of bank branching, this is the first study to develop a longitudinal measure of financial access at the village level. This helps to understand spatial heterogeneity in bank branch access within states, which other studies are unable to do. Second, the paper analyses the role of village-level socio-economic and demographic characteristics in proximity to bank branches. This analysis helps in discovering micro-foundations of growth of bank branch network. The granularity of the approach adopted here overcomes the confoundedness problems that the studies at a more aggregate level face.

Details

International Journal of Bank Marketing, vol. 41 no. 4
Type: Research Article
ISSN: 0265-2323

Keywords

Abstract

Details

The Impacts of Monetary Policy in the 21st Century: Perspectives from Emerging Economies
Type: Book
ISBN: 978-1-78973-319-8

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