Rural Banking in INDIA started since the Establishment of banking sector in INDA Regional Rural Banks was set up after nationalizations of Banks in 1969 when emphasis shifted to providing more credit to weaker sections.

Regional Rural Banks were established under the provisions of an Ordinance promulgated on the 26^th September 1975 and RRB Act, 1976 with an objective to ensure sufficient institutional credit for agriculture and other rural sectors. Rural Banks in those days mainly focused upon the Agro Sector. Regional Rural Banks in INDIA penetrated every corner of the country and extended a helping hand in the growth process of the country.³

RRBs are jointly owned by Government of INDIA, the concerned State Government and Sponsor Banks (27 scheduled commercial banks and one State Cooperative Bank); the issued capital of a RRB is shared by the owners in the proportion of 50%, 15% and 35% respectively.⁵

Initially, five RRBs were set up on October 2, 1975 which were sponsored by Syndicate Bank, State Bank of India, Punjab National Bank, United Commercial Bank and United Bank of India. Capital share being 50% by the central government, 15% by the state government and 35% by the scheduled bank.

Earlier Reserve Bank of India had laid down ceilings on the rate of interest to be charged by these RRBs. However from August 1996 the RRBs have been granted freedom to fix rates of interest, which is usually in the range of 14-18% for advances.¹³

The Dantwala Committee 1978, recommended that RRBs should become an integral part of the rural credit structure and Priority for establishing RRBs should be given to those districts where CCBs are weak. Following this recommendation, steps have been taken to establish more RRBs. As a result, by the end of June 1980, the total number of RRBs increased to 73 covering 130 districts in 17 states. The new RRBs are located in areas where the co-operative credit system is weak and the commercial bank branch network inadequate.²

The Reserve Bank of INDIA has a mandate to be closely involved in matters relating to rural credit and banking by virtue of provisions of SECTION 54 OF THE RBI Act. The major initiative in pursuance of this mandate was taken with sponsoring of All INDIA Rural credit survey in 1951-52. This study made agency wise estimates of rural indebtedness and observed that cooperation has failed but it must succeed. The report of the committee on directions is still considered a classic on the subject, and two of the four members were, incidentally, from Andhra Pradesh. This Is the origin of the policy of extending forma; credit through institutions while viewing local, traditional and informal agencies as usurious.⁶

Among other things, the study report has brought out that RRBs have to operate with some serious constraints:

"They {Regional Rural Banks} have to

(i) lend only to the weaker sections,

(ii) charge lower rate of interest,

(iii) open branches in remote rural areas

(iv) Keep up low cost profile."²

After Recommendation of Kelkar Committee in April 1987 Government of INDIA stop its further establishments of Regional Rural Banks in INDIA.¹

In between this Prof. Muhammad Yunus Started Grameen Bank (literally, “Bank of Villages” in Bengali) in Bangladesh.¹⁰

The Grameen Bank has grown into over two dozen enterprises represented by the Grameen Family of Enterprises. These organizations include:

Grameen Trust,

Grameen Fund,

Grameen Communications,

Grameen Shakti (Grameen Energy),

Grameen Telecom,

Grameen Shikkha (Grameen Education),

Grameen Motsho (Grameen Fisheries),

Grameen Baybosa Bikash (Grameen Business Development),

Grameen Phone,

Grameen Software Limited,

Grameen CyberNet Limited,

Grameen Knitwear Limited, and

Grameen Uddog (owner of the brand Grameen Check).⁸

The Bank also incorporates a set of values embodied in Bangladesh by the Sixteen Decisions.

Sixteen Decisions:

1. We shall follow and advance the four principles of Grameen Bank: Discipline, Unity, Courage and Hard work – in all walks of our lives.

2. Prosperity we shall bring to our families.

3. We shall not live in dilapidated houses. We shall repair our houses and work towards constructing new houses at the earliest.

4. We shall grow vegetables all the year round. We shall eat plenty of them and sell the surplus.

5. During the plantation seasons, we shall plant as many seedlings as possible.

6. We shall plan to keep our families small. We shall minimize our expenditures. We shall look after our health.

7. We shall educate our children and ensure that they can earn to pay for their education.

8. We shall always keep our children and the environment clean.

9. We shall build and use pit-latrines.

10. We shall drink water from tube wells. If it is not available, we shall boil water or use alum.

11. We shall not take any dowry at our sons' weddings; neither shall we give any dowry at our daughter's wedding. We shall keep our centre free from the curse of dowry. We shall not practice child marriage.

12. We shall not inflict any injustice on anyone; neither shall we allow anyone to do so.

13. We shall collectively undertake bigger investments for higher incomes.

14. We shall always be ready to help each other. If anyone is in difficulty, we shall all help him or her.

15. If we come to know of any breach of discipline in any centre, we shall all go there and help restore discipline.

16. We shall take part in all social activities collectively.¹⁰

TEN INDICATORS:

Every year GB staff evaluates their work and check whether the socioeconomic situation of GB members is improving. GB evaluates poverty level of the borrowers using ten indicators.

A member is considered to have moved out of poverty if her family fulfills the following criteria:

1.	The family lives in a house worth at least Tk. 25,000 (twenty five thousand) or a house with a tin roof, and each member of the family is able to sleep on bed instead of on the floor.
2.	Family members drink pure water of tube-wells, boiled water or water purified by using alum, arsenic-free, purifying tablets or pitcher filters.
3.	All children in the family over six years of age are all going to school or finished primary school.
4.	Minimum weekly loan installment of the borrower is Tk. 200 or more.
5.	Family uses sanitary latrine.
6.	Family members have adequate clothing for everyday use, warm clothing for winter, such as shawls, sweaters, blankets, etc, and mosquito-nets to protect themselves from mosquitoes.
7.	Family has sources of additional income, such as vegetable garden, fruit-bearing trees, etc, so that they are able to fall back on these sources of income when they need additional money.
8.	The borrower maintains an average annual balance of Tk. 5,000 in her savings accounts.
9.	Family experiences no difficulty in having three square meals a day throughout the year, i. e. no member of the family goes hungry any time of the year.
10.	Family can take care of the health. If any member of the family falls ill, family can afford to take all necessary steps to seek adequate healthcare. ⁷

The Majority of the people in the earth lives in rural areas and follow patterns of occupation and life is different from those living in urban areas. A development banker must have deeper insight into the reasons, motivation, purposes and objectives of the way rural people act, think and live.⁹

Definition of Rural Area – the Census of INDIA has defined a village as under:

“The basic unit for rural area is the revenue village which has definite surveyed boundaries. The revenue village may comprise several hamlets but the entire village is treated as one unit having population not exceeding 10,000 as per 1991 census”

General Characteristics of Rural People:

· Ignorant but intelligent.

· Traditional values and beliefs.

· Superstitious in their outlook.

· Fatalistic temperament / Trust on destiny rather than o self efforts.

· Locus of control external.

· Inferiority complex / repressed emotions.

· Very low cognitive level (they do not express their feelings, needs, thoughts easily).

· Low level of trust on city / urban dwellers.

· Fear of exploitation is high.

· Poor and low responses to any change.

· Affinity level is very high.⁹

RRBs established with the explicit objective of:

01. Bridging the credit gap in rural areas.

02. Check the outflow of rural deposits to urban areas.

03. Reduce regional imbalances and increase rural employment generation.

The main objective of setting up the RRB is providing credit and other facilities, especially to the small and marginal farmers, agricultural laborers artisans and small entrepreneurs in rural areas.⁴

Functions:

Every RRB is authorized to carry on to transact the business of banking as defined in the Banking Regulation Act and may also engage in other business specified in Section 6 (1) of the said Act. In particular‚ a RRB is required to undertake the business of

(a) granting loans and advances to small and marginal farmers and agricultural laborers‚ whether individually or in groups, and to cooperative societies‚ including agricultural marketing societies‚ agricultural processing societies‚ cooperative farming societies‚ primary agricultural credit societies or farmers’ service societies‚ primary agricultural purposes or agricultural operations or other related purposes, and

(b) Granting loans and advances to artisans‚ small entrepreneurs and persons of small means engaged in trade‚ commerce‚ industry or other productive activities‚ within its area of operation.

The Reserve Bank of India has brought RRB’s under the ambit of priority sector lending on par with the commercial banks. They have to ensure that forty percent of their advances are accounted for the priority sector. Within the 40% priority target, 25% should go to weaker section or 10% of their total advances to go to weaker section.⁴

Regional Rural Banks in India:

The State Bank of India is one of the major commercial banks having regional rural banks. There are 30 Regional Rural Banks in India, under the State Bank of India and it is spread in 13 states across India. The number of branches the SBI Regional Rural Banks is more than 2000.
Several other banks, apart from the State Bank of India also functions as the promoter of rural development in India. Regional Rural Banks in India are an integral part of the rural credit structure of the country. Since the very beginning, when the Regional Rural Banks in India (RRBs) were established in October 2, 1975, these banks played a pivotal role in the economic development of the rural India. The main goal of establishing regional rural banks in India was to provide credit to the rural people who are not economically strong enough, especially the small and marginal farmers, artisans, agricultural labors, and even small entrepreneurs.¹¹

PROBLEMS FACED BY Regional Rural Banks as per Narasimham Committee:

1. Haste and lack of coordination in branch expansion.

2. Difficulties in deposit mobilization.

3. Constraints in deposit mobilization.

4. Slow progress in lending activity.

5. Urban orientation of staff.

6. Procedural rigidities.

SUGGESTION FOR REORGANISATION AND IMPROVEMENT IN THE WORKING:

OF Regional Rural Banks:

1. The unique role of RRB in providing credit facilities to weaker sections in the villages must be preserved. The RRB should exist as rural banks of the rural poor.

2. The RRB may be permitted to lend up to 25% of their total advances to the richer section of the village society.

3. The State Government should also take keen interest in the growth of RRB.

4. Participation of local people in the equity share capital of the RRB should be allowed encouraged.

5. Local staff may be appointed as far as possible.

6. Cooperative societies may be allowed to sponsor or co-sponsor with commercial banks in the establishment of the RRB.

7. A uniform pattern of interest rate structure should be devised for the rural financial agencies.

8. The RRB must strengthen effective credit administration by way of credit appraisal, monitoring the progress of loans and their efficient recovery.

9. The credit policy of the RRB should be based on the group approach of financing rural activities.

10. The RRB may initiate certain new insurable policies like deposit-linked cattle and other animal’s insurance policy, crop insurance policy or the life insurance policy for the rural depositors.

11. The RRB may relax their procedure for lending and make them easier for village borrowers.

12. Co-ordination between district level development planning and district level credit planning is also required in order to chart out the specific role of the RRB as a development agency of the rural areas.

Recommendations of the Different Committees on Regional Rural Banks:

Dantwala Committee 1977, Narasimham Committee 1991, Khusro Committee.

Dantwala Committee 1977.

In June 1977, the Reserve Bank of India appointed a committee to review the working of RRB. Professor M.L. Dantwala headed it and the committee submitted report to the Reserve Bank of India with some important recommendations.

1. The RRB with some modification in their organization and function become a very useful component in the totality of the rural credit structure. The RRB can make a substantial contribution to improving quality and quantity of credit flows to the rural areas by becoming an integral part of the rural credit structure.

2. Providing rural credit in a more efficient manner.

3. The RRB should function at the intermediate level. It should progressively fill the credit gap in the rural sector.

4. The jurisdiction of a RRB should be confined to one district.

5. The RRB should be allowed to provide full banking facilities in the areas of their operation.

6. Forms and procedure of the RRB should be simplified.

7. Sponsoring banks should provide training to the staff of the RRB.

8. The RRB should adequately recruit technical staff.

9. The RRB should ensure uniformity in the interest rate policy on par with all rural financial agencies in the organized sector of the money market.

Narasimham Committee 1991:

RRB were establish mainly to provide a low cost alternative to the operation of commercial bank branches but the functioning of the RRB gives much cause for concern. According to Narasimham committee, there are basic three problems faced by the RRB.

1. Because of the many restriction placed on the businesses they can undertake, RRB have low earning capacity.

2. The wage and salary scales of RRB have been rising and, in fact with the recent award of Tribunal, their salary scales, an important rationale for the setting up of RRB has ceased to exist.

3. The sponsoring bank are also running their own rural branches in the every area of operation of the RRB. This has given rise to certain anomalies and to avoidable expenditure on controls and administration.

Recommendation of Narasimham Committee:

1. Commercial bank should segregate the operation of their rural branches through the formation of one or more subsidiaries.

2. Each rural subsidiary should have compact area of operation so as to facilitate recruitment and development of manpower apart from providing the needed trust in business operations and effective improvement in the control and the supervision and information system.

3. The rural subsidiaries should be treated at par with RRB in regard to cash reserves and statutory liquidity requirements (SLR) and refinance facilities from NABARD.

4. All concession in lending to agriculture and to small industry should be phased out, and there would be saving in cost of administration brought through the process of rationalization.

5. NABARD should help RRB to earn higher level of interest income for their surplus cash balances and for their funds presently invested in Government securities or in Government guaranteed securities for SLR compliance.

Khusro Committee:

The Agriculture Credit Review Committee under the chairmanship of Dr. A.M. Khusro observed that weakness of RRB were endemic and non – viability was built in to their structure. RRB has accumulated huge losses over the year and, in some cases, the losses have eroded even a part of their deposits. There was, thus, a strong case of winding up of such insolvent institutions. Besides, RRB would not be able to serve the interest of the largest groups in the manner expected of them. According to the Khusro Committee, there was no place for RRB in the country rural system in near future and they should be merged with sponsored banks.¹²

Rural sector continues to play an important role in terms of contribution to GDP and employment generation in India, as about 70 percent of India’s population still lives in rural areas. The slow reduction of poverty levels in rural areas against urban areas is an evidence of the sluggish development in rural areas, in spite of new opportunities coming up in rural areas in the post-liberalization due to better rural-urban linkages and backward and forward linkages of agricultural sector with non-agricultural sector. If the rural population takes advantage of these new opportunities there is a greater scope for reduction in poverty and increase in living standards.

As many rural people are poor and having shortage of capital. Provision of services along with credit will not only facilitate borrowers in better utilization of credit but also enhance the credit worthiness of borrowers, which helps in recovery of loans and reduction in non-performing assets of banks.

Historically, traditionally money-lending business is highly profitable in rural India as many of the moneylenders became rich in the business of money lending. To some extent, their profitability is due to low cost of operation in terms of identifying individuals who are credit worthy, procedures and formalities followed, accessibility, location in densely populated area, individual assessment/pricing based on risk/behavioral assessment. But, due to the high exploitation by

Moneylenders by levying higher interest rates government discouraged traditional money lending. Since independence,

Indian government encouraged many institutions beginning with cooperative credit societies in 1950s followed by social Control in 1968, then nationalization of banks in two steps once in 1969 and another in 1980. The establishment of Regional Rural Banks in 1972 is also a step in that direction. Government simultaneously initiated many rural poverty alleviation/ developmental schemes such as community development programmes, service area approach, lead bank scheme, Integrated Rural Development Programme (IRDP) and more recently Swarnajayanti Gram Swarozgar Yojana (SGSY) with a major component of credit with active participation of banks. With all these efforts, the network of branches increased drastically throughout rural India, as now for every six villages one-bank branch is there. In the process average population (in‘000s) per bank branch came down significantly from 64 in 1969 to 15.2 in 2001. With the main focus on branch expansion and credit expansion without giving adequate attention to the profitability and efficiency, Indian banking system suffered from many typical banking problems such as high NPAs, low profitability, high subsidies and low service quality.

Need for Rural Banking to be Competitive:

Generally in rural areas, demand surpasses supply of credit (as it is widely assumed that credit rationing is widely practiced both by institutional and non-institutional moneylenders), in surplus demand conditions, banks can become economically unviable only if there are high non-performing assets, controlled credit rates and high operating costs. Inefficiency of rural credit institutions was attributed to the directed and pre-approved nature of loans sanctioned under sponsored programmes, absence of any security, and lack of effective follow up due to large number of accounts, legal recovery measures being considered not cost effective, and riddance of repayment culture consequent to loan Waiver schemes, etc. While in general the rates of interest have come down, they are available more too highly rated borrowers than to the rural sector and small and medium enterprises. Commenting on functioning of cooperatives Datt and Sundharam (2004) stated that, in many places, unscrupulous and dishonest local large farmers take all the benefits from cooperatives, thus denying the benefits of co-operation to really needy farmers, have hopelessly wrecked the working of the co-operatives. On the other hand RRBs are suffering from losses since its inception. Some estimated that the RRBs in

Their present set-up incurs losses of about Rs. 5, 00,000/- per day - despite their lower costs of operation.

Highlighting the importance of rural credit reforms RBI (2002) stated that, there is a need to examine the issue of rural

Credit and its delivery systems in an objective as well as transparent manner and accord it priority in legislative actions and

Financial allocations. The problem with rural banking is high cost of reaching to the remote areas and small account holders. To make operations of regional rural banks more cost competitive, these banks should become lean, technologically capable and organizationally flexible to suite to local population.

Bank Branches-Lean Banks with Skilled Manpower:

Large number of bank branches, will not make economic sense in cost competitive banking system. There is an urgent need to reduce bank branches and build other alternate sources to reach out to widely spread rural population. This will reduce operating and overhead costs. Establishing one bank branch for every 40 to 50 villages according to the geographical area, population size is enough to cater to the needs of rural population. The main purpose of reducing bank branches is to have small number of banks with necessary infrastructure. The bank branch should be lean and slim it terms of number of employees, but with high level of computerization and other technical facilities and expertise.

Reaching Out through Mobile-Banks and Agents/ Representatives:

To reach to vast majority of rural population bank branches should organize mobile banks and take help of bank agents/

Representatives. These banks can recruit their own field assistants/representatives to make frequent filed visits to Villages and help banks to acquire new customers, loans/ deposits. These representatives may be village traditional moneylender/ village fertilizer shop owner/general stores person or uneducated youth/LIC agent/UTI agent who does have local knowledge, know local people and having confidence by local people. The dates of these mobile-banks to be coincide with the weekly traditional melas (mandis) that will be convenient to the village people, as most of the villagers come to melas either to purchase/sell their farm inputs/outputs and also household consumables. The basic function of mobile banks is to do normal business of taking deposits/loans and other service provisions. The representatives should work on commission basis, as it makes them self-motivated and cost effective. New information technology greatly improves efficiency of even rural banking system if banks adopt them by recruiting skilled persons and installing necessary software and hardware by acquiring simple computers with minimum cost. The banks should be free to evolve and implement their own policies on personnel, including recruitment, training, and incentive systems. Proper training is to be given to representatives/ agents in handling new customers. This will greatly reduce overhead costs.

Regional Banks - Flexible Multi-Service Providers:

With the changing scenario of flexible operations, emphasis to be placed more on priority setting in terms of which agroindustries/ crops to be encouraged rather than emphasis on target setting at district level. This approach gives a directive based on social goals to the regional rural banks, without compromising freedom of operations. All the banks operating in a region/district are free to set their own targets. The priority setting at district level is only a kind of direction and knowledge enhancing exercise but not a compulsion to banks to follow. This kind of exercise gives an idea about the general development outlook/government priorities/policy objectives. The basic strategic advantage of proposed rural banks lies in their local knowledge compared to other national level commercial banks. On this premise, banks should take

Advantage of this local knowledge by providing as many services as possible which satisfy/ provide competitively to the local people. For example, banks may provide information on weekly prices of inputs and outputs to farmers, advice on crop/ weather insurance, assist in procuring/ storing local farm inputs/outputs with the help of non-governmental organizations/ government/local administration. As these will not require much over head costs, but facilitate farmers/local

Traders to come to bank branches/ mobile-banks more frequently and add value to the main banking operations.¹⁰

In Rural Markets banks has to look upon the needs and derives of the personals and that will happen only when they follow the particular trends.

Like while going for open a market in rural areas define the products as per their desires, one is successful in particular market when instead of looking for own business, they will learn how to retain as gain the customers. Because customer is king and that is acceptable when companies develop their needs as per customers.

Benefits:

Gaining more customers in low populated areas bank will start earning revenue from these area

Things to do

1. Initially identify the rural market.

2. Search for the competitive banks working over their

3. Check for their product and offerings

4. Make a proper plan

5. Develop the product as per the rural market demand.

After doing R&D, planning and product development launch your concept / Product in that market.

And see the difference between your scheme and the competitive scheme you will be able to acquire 60% of market in first two months.

Because this is INDIAN corporate Battlefield and we know

“INDIA WORKS BECAUSE WE MAKE INDIA TO WORK”¹³

The future of banking in rural areas would, however, depend on several factors that have been described, namely, how the current concerns are addressed talking into account the dynamics of transformation in rural economies, the new realities in credit market, the linkages between formal and informal markets, and the impact of financial as well as technological progress on the systems of financial intermediation. Consequently, public policy will have to address several issues to ensure a sound and efficient banking system in the service of rural areas. The more important of such issues relate to the approach, institutions, supply, cost and related policies.⁶

Rural Communications: In today’s world it is not enough to develop a good product and offer it at proper price. If we are interested in more than “walk-in” business we will have to establish effective rapport with our customers or potential customers. We will have to make the potential customers. We will have to make the potential customers aware about our services, convince them about the quality, dependability and competitiveness of our products and brings them to our fold. O this we will have to establish emotionally satisfying relationships with our customers through effective communications.

Communication is the most important activity of all managers. Almost 75% of manager’s time is spent in communication. Despite its importance communication more often than not, is neglected by managers.

Kieth Davis in his book “Organizational Behaviors” says “all management passes through the bottleneck of communication”

Rural communication is still more an arduous task because the bank officials and the farmers generally come from altogether different backgrounds. Which puts a barrier to effective communication? The process of rural communication can be divided into four critical components.

01. Receiver.

02. Channel.

03. Message and

04. Communicator.

01. Receiver: in rural communication normally receiver is a member of rural community displaying following chacteristics.

A. Communication Skills – keeping in view the literacy level of rural INDIA, writing and reading skill may be lacking among rural customers. We will have to rely on speaking-listening skills.

This may probably be the reason for poor response to written communications directed toward rural customers. From the point of view of communication skill, painting, drawing and gesturing are also important. One picture is worth 1000 words. Similarly words are inadequate to express the message convey by a pleasant smile or warm hank shake. In rural communication these hold immense promise all posters and pamphlets designed for rural people invariably contain pictures for this very reason.

B. Attitudes – How a message is received depends on receiver’s attitude.

a. Towards himself

b. Towards the source

c. Towards the contents of the message.

Indian agriculture is a gable in monsoon and illiteracy is rampant in rural INDIA and these factors tend to instill a sense of fatalism among the farmers. On this count there is no need to be critical o rural beliefs. If the rural people are convinced that the communicator is speaking for them, they readily accept the message. When the farmers believe that the communicator likes hem, they are much less critical of his message.

C. Knowledge – though the rural people are illiterate they are worldly wise. Most of know the entire gamut of agriculture right from sowing to marketing. Every farm is an enterprise in itself and every farmer is an entrepreneur. Further, Indian farmers have respond very well to technological innovations as a result of which agricultural product has increased fourfold from 50 million tones in 1950 to about 211 millions tones in 2001-02.contrary to this, there is a popular opinion amongst urban people that farmers are tradition bound and they do not respond to innovations.

D. Social System- Indian village communities are small in size which makes them more homogenous and less stratified. As a result the entire village behaves like a large family. Indian farmers are less mobile with lses contacts. But, they have durable and humane relationships. Hence regular visits to rural families help in sustaining and developing rural business.

E. Culture – Culture can be thought o as a system of values of society. The traditional social value of INDIA is dharma, renunciation, karma, social hierarchy, tolerance, ahimsa, harmony, feminism and resects for elders. Because of these values even now erstwhile feudal lords and priest class enjoy considerable influence in rural societies which needs to be appreciated in rural operations.

02. Channel: A study conducted by HASS and ENING (1950) reveals that attention of people is dawn by various senses in the following proportion.

SIGHT 87 %

HEARING 07 %

SMELL 03.50 %

TOUCH 01.50 %

TASTE 01 %

Thus sight and hearing are the major senses involved in learning process. The use of audio visual aids in communications id\s based on these facts. A number of films are available in DAVP on modern agricultural practices which we can borrow and arrange for screening in rural areas which will develop demand for agricultural credit.

03. Message: the message is the stimulus that the source transmits to the receiver. A message in rural communication is the information which we want the famer to receive, understand, accept and act upon. Before we initiate any communication we should be very clear about the purpose of communication and its contents. A message relating to the felt need of the farmers will not go in noticed. An expert communicator always ensures accuracy, timeliness, applicability and adequacy of the message. In rural communication occasions like festival, marriage etc must keep be kept in mind.

04. Communicator: for our purpose communicator is a banker displays the following characteristics.

A. Communication Skills: He is educated having good command of language.

B. Attitude: normally he is urbanite missing urban amenities and way of life, challenges of high-tech/high value advances and intellectual intercourses. He may also be entertaining prejudices about rural people. This may shape his attitude towards the receiver which may become a barrier in communication. Only an empathetic attitude towards the farmers will help establish effective communication with rural people which will decide success in his rural assignment.

C. Knowledge: Bank officers/ employees are having far better knowledge as compared to receiver. But they will have to put it to the farmer’s n layman’s language. Wherever possible displays/ demonstration may be organized for effective communication.⁹

MATERIAL AND METHOD:

Method of Research is totally based on Market research in special in Rural Areas like Dalli Rajhara, kusumkasa, dondi, and chiklakasa villages, Study of various references books and by Internet sources mentioned in reference and analyzing personal experiences of Present and retired bank Officers.

RESULT:

After studying various references and analyzing experiences of present and retired bank officer result come that by applying latest technology and applying Ideas of Dr. Y. R. Reddy, Deputy Governor, Reserve Bank of INDIA. We can increase the market acceptability and improve services of Regional Rural Banks.

DISCUSSION:

To conclude, we have no doubt that given the necessary aid, support and guidance for RRB will come to have an increasingly important role as an integral element of the improvement of services and developing the market area for RRB. Here we not only pointed the factor related to the RRB but also make a crucial notes how to behave with customers and what are the customers mentality what should be the manner of talking either verbal or non verbal both are mentioned. Authors are strongly support the way because Amalgamation of banks in not a solution to overcome the NPA or other Problems.

ACKNOWLEDGEMENT:

My special thanks to Mr. Kamlesh Gupta branch officer SBI Dalli Rajhara not only for providing me bank related books, journals but also for clearing my doubt time to time.

I also thankful to Dr. Kalyandas Sharma for providing me commercial supports.

REFERENCE:

1- Kshetriya Grameen Bank Samanya General Hindi byTarun goyal and Rahul shukla, Knowledge group H-324, Shashtri Nagar erath – 250004 pg no. 3-4.

2- http://www.nabard.org/pdf/craficard/Chapter_07.pdf

3- http://www.guide4bankexams.blogspot.com

4- http://business.mapsofindia.com/rural-economy/development/regional-banks.html

5- http://www.nabard.org/pdf/report_financial/Chap_V.pdf

6- http://rbidocs.rbi.org.in/rdocs/Bulletin/PDFs/10991.pdf

7- http://www.grameen-info.org/index.php?option=com_content&task=view&id=23&Itemid=126

8- http://web.archive.org/web/20080822140351/http://www.grameencommunications.com/gfamily.html

9- Reading Material, Foundation training programmer phase-III for probationary officers in agricultural Banking and rural development, State Bank Institute of Rural Development Hydrabaad – 500019 pgno.17 to 26.

10- http://en.wikipedia.org/wiki/Grameen_Bank

11- http://comtday.blogspot.in/2009/04/indian-rural-banking-emerging-trends.html

12- http://en.wikipedia.org/wiki/Regional_Rural_Bank

13- http://toostep.com/insight/rural-banking-product

Received on 10.11.2012 Modified on 22.11.2012

Asian J. Management 3(4): Oct.-Dec., 2012 page 188-195