ROLE OF MAHILA URBAN CO-OPERATIVE BANKS IN DEVELOPMENT OF WOMEN ENTREPRENEURS

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1 ROLE OF MAHILA URBAN CO-OPERATIVE BANKS IN DEVELOPMENT OF WOMEN ENTREPRENEURS PALLAVI TAKHER 1 PROF. K. C. SODANI 2 1 Research Scholar, Department of Business Administration, MLSU, Udaipur (Rajasthan) 2 Vice Chancellor, Maharshi Dayanand Saraswati University, Ajmer (Rajasthan) ABSTRACT Mere ideas and innovations cannot produce a successful women entrepreneur, along with financial support for investment and working capital is also required. Such investments may not be fulfilled by the savings or personal borrowings alone. To fulfill these needs Mahila Urban Co-operative banks were emerged. The present aims to identify the role of Mahila Urban Co-operative banks for development of women entrepreneurs. To serve the objective descriptive research design is used and primary data is collected from 300 respondents with the help of questionnaire. Data is analyzed with the help of frequency distribution and arithmetic mean. It has been concluded that Mahila Urban Cooperative Banks are significantly helping in Development of Women Entrepreneurs. Keywords: Women Entrepreneur, Mahila Urban Co-operative bank Introduction: The very fact that almost 50% of the world (49.66%) and Indian (48.45%) population comprises of women, it becomes imperative to financially empower women so as to enable them to make meaningful contributions towards the development of the economy. The problem of financial empowerment becomes even graver when it comes to poor women which again are a sizeable population in India as well as in the other Developing nations. No Developing nation can actually think of progressing economically by excluding its women population. To add to the woes the socioeconomic environment of such countries has always been causing great impediments to involving the women in economic activities. In India 93% of all workers are self employed. Women constitute more than half of this workforce and more than 96% of women workers are self employed. They consist of vendors, homebased workers, weavers, garment makers, food processors and craft people, manual labour and service providers such as agricultural labour, construction workers, rag pickers, domestic workers etc. These workers are characterized by insecure employment, low income, lack of capital assets, lack of access to institutional support and no social security leading to extreme level of poverty. These are the financially excluded people who require access to credit to come out of poverty. The Commercial Banks, Private sector and Foreign Banks do not find them credit worthy and so unfortunately these under privileged people find themselves in the clutches of moneylenders only to sink into deeper poverty. The attempts made by Commercial Banks to help these women through self help groups has opened doors for them but certainly has had limited reach as these banks are not able to relate to the poor women from urban as well rural areas to the extent required. To maximize reach it is essential for banks to understand the pulse and the psyche of these women to initiate them into banking habits, which they are unable to perform successfully. Poor, illiterate women find it useful to deal with a bank only if its services are tailored to suit their needs. Banking with the poor and the illiterate requires special procedures and mechanisms suited to their culture, their needs and their economy icmrrjournal@gmail.com

2 This entails simple procedures, designing schemes that allow for small savings, training & assistance in understanding and dealing with banking procedures, door to door service, banking policies that adapt to their crisis situations and credit based on savings performance or loan repayment instead of collateral. It is also to be understood that access to financial services alone is not enough for poor people to transform their economic activities into profitable economic enterprises. Access to markets, information, technical know-how and social support services is as important as money if the poor are to share in economic growth. Women entrepreneurship has been acknowledged as vital source of economic growth. Women entrepreneurs generate new jobs for themselves and others and also provide society with different solutions to management, organisation and business problems. However, they still represent a minority of all entrepreneurs. Women entrepreneurs often face gender-based barriers to starting and growing their businesses, like discriminatory property, matrimonial and inheritance laws and/or cultural practices; lack of access to formal finance mechanisms; limited mobility and access to information and networks, etc. Women s entrepreneurship can make a particularly strong role to the economic well-being of the family and communities, poverty reduction and women s empowerment, thus contributing to the Millennium Development Goals (MDGs). Thus, governments across the world as well as various developmental organizations are actively undertaking promotion of women entrepreneurs through various schemes, incentives and promotional measures. Literature Review: Matharu & Kriplani (2014) Analyszed the objectives of women bank as to promote asset ownership amongst women. The paper discusses about first women bank in India & role of women banks in entrepreneurship development amongst women. The paper explains that Government has taken initiative & set out an action of involvement of women in business & entrepreneurship by the inception of Indian Women s Bank. Kathiriya (2013) in his article explained that the Banking services play critical role in the development of the any economy. As per Indian constitution cooperative bank supports farmers for getting their any benefit from the government. It explained the role of Urban Co-operative banks and in context of Indian Constitution. The Author discussed the activities and benefits of Co-operative banks. It also explained the challenges for Co-operative banks and provided suggestions to them. Purohit & Jain (2013) analyzed the role of women oriented financial services of Cooperative banks. The study discussed the various activities of self employed women. It declares the ways to justify Cooperative banks as an important constituent of the Indian financial system. The present paper is an effort to find the role of women in financial services especially cooperative banks. As per the International Co-operative Alliance a cooperative organization is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations. Babu & Selkhar (2012) studied a range of problems of Urban Co-operative banks. It also analyzed the rising role and prospects of these banks especially in the coming era. It provides comprehensive study of economic and social benefits of Urban Co-operative banks. It described other functions and activities of these banks. The article also provided the strengthening suggestions for these banks icmrrjournal@gmail.com

3 Giagnocavo, Gerez & Sforzi (2012) explained the strategies that the cooperative banks use to address local socio-economic challenges through the financing and promotion of cooperatives, local development initiatives and socially oriented enterprises are investigated. Two paradigmatic regions with strong cooperative bank sectors are compared, illustrating strategic differences in their approach to cooperative and local development and social enterprise promotion. Objective: The purpose of this research paper is to analyze the role of Mahila Urban Co-operative banks for development of women entrepreneurs Research Methodology (a) Research Design: - To have a better understanding about the issue descriptive research design was used. To get the primary data close ended questionnaire was administrated. (b) Sample Design: - The Universe of the study consists of all the 6 Mahila Urban Co-operative banks in Rajasthan; for the representation of all the 6 banks the head quarter branch is considered. Following six banks have been selected in Sample 1. Bhilwara Mahila Urban Co-op Bank Ltd., Bhilwara 2. Rajlaxmi Mahila Urban Co-op Bank Ltd., Jaipur 3. Rajputana Mahila Urban Co-op Bank Ltd., Jaipur 4. Udaipur Mahila Urban Co-op Bank Ltd., Udaipur 5. Udaipur Mahila Samridhi Urban Co-op Bank Ltd., Udaipur 6. Kota Mahila Nagrik Sahakari Bank Ltd., Kota. The sample of women entrepreneurs is selected by using judgmental sampling. From each bank 50 respondents have been selected so in total a sample of 300 respondents has been finalized for study (c) Analysis: - The data collected was analyzed with the help of Frequency distribution & Arithmetic mean. Analysis & Interpretations 1. Occupation before become an Entrepreneur Respondents were asked that how what was your occupation before you become an entrepreneur and It can be seen from table 1 that maximum number of respondents (N=103, Percentage=34.33) were looking for work. According to 21.67% respondents (N=65) they were home maker followed by 20.33% (N=61) respondents who were employed in full time profession and 20% respondents (N=60) were employed in a part time profession. Table 1: Occupation before become an Entrepreneur Previous Occupation N Percentage Employed in a full time profession Employed in a part time profession Looking for work Home maker Other Total icmrrjournal@gmail.com

4 2 Main Reason for Starting a Venture Respondents were asked to indicate that what was the main reason for starting the venture? Majority of respondents (N=73, Percentage=24.33) said that they did not have a better alternative followed by 16.33% respondents (N=49) who became entrepreneur so that they can be financial independent. Another reasons behind becoming an entrepreneur were It was a family tradition/business (N=17, Percentage=5.67), Had some experience/training in this field (N=18, Percentage=6), Was always interested in it (N=27, Percentage=9), Considered it to be the most profitable venture (N=5, Percentage=1.67), Was dissatisfied with the existing job (N=8, Percentage=2.67), To supplement the family income (N=39, Percentage=13), To improve social status (N=11, Percentage=3.67), Sense of self achievement (N=28, Percentage=9.33), My Family encouraged me to do (N=22, Percentage=7.33) and My friends encouraged me to do (N=3, Percentage=1.00) Table 2: Main Reason for Starting a Venture Reason N Percentage Did not have a better alternative It was a family tradition/business Had some experience/training in this field Was always interested in it Considered it to be the most profitable venture Was dissatisfied with the existing job To supplement the family income To be financial independent To improve social status Sense of self achievement My Family encouraged me to do My friends encouraged me to do Total Mode of becoming an Entrepreneur It can be seen from table 3 that maximum number of respondents (N=168, Percentage=56) became an entrepreneur by creating an enterprise followed by 30.67% (N=92) respondents who purchased an enterprise. 8% respondents (N=24) inherit the enterprise while rest respondents (N=16, Percentage= 5.33) adopted some other method of becoming an entrepreneur. Table 3: Mode of becoming an Entrepreneur Response N Percentage Create the enterprise Purchase the enterprise Inherit the enterprise Other Total icmrrjournal@gmail.com

5 4. Type of Financing Arrangements Women entrepreneurs were asked that what type of financing arrangements they have with the cooperative banks. As results presented in table it can be observed that 64% respondents (N=62) have received working capital finance from cooperative banks, 33.33% respondents (N=100) have received fixed capital financing and rest 2.67% respondents (N=8) have received other forms of credit & bank Support from Mahila Cooperative banks. Table 4: Type of Financing Arrangements Source of Finance N Percentage Working Capital Financing Fixed Capital Financing Other forms of credit & bank Support Total Role of Mahila Urban Co-operative Banks in Development of Women Entrepreneurs To check the Role of Mahila Urban Co-operative Banks in Development of Women Entrepreneurs, respondents were requested to share their level of agreement for various statements. The degree of agreement towards statements was set from 1 to 5 (5 denotes the strongly agree, whereas, 1 is the strongly disagree). In addition following criteria is used for analysis part:- The score among means Strongly Disagree The score among means Disagree The score among means Neutral The score among means Agree The score among means Strongly Agree The results received are presented in table 5 Table 5: Role of Mahila Urban Co-Operative Banks in Development of Women Entrepreneurs Statement Mean Score Result Mahila Urban Co-Operative Banks identifies / recognizes micro scale enterprise needs 4.38 Agree Banks I could develop new enterprise 4.20 Agree Banks I could expand size of my enterprise 4.09 Agree Banks I could expand my enterprise in new locations 4.14 Agree Banks I could improve quality of products / service 4.22 Strongly Agree Banks I could hire new workers Mahila Urban Co-Operative Banks provided me technical assistance in setting a new venture 4.10 Agree 4.20 Agree 44 icmrrjournal@gmail.com

6 Mahila Urban Co-Operative Banks makes me aware about various schemes for starting a new venture Raising capital through Mahila Urban Co-Operative Banks is easier than other sources of finance Mahila Urban Co-Operative Banks provided me working capital as and when required Financing cost is less in case of Mahila Urban Co- Operative Banks as compare to other sources of finance Mahila Urban Co-Operative Banks focus more on social collateral vis-à-vis financial collateral which helps in establishing new venture Financing from Mahila Urban Co-Operative Banks is a less risky mode of raising capital Our firm Has bought new machinery after getting finance from Mahila Urban Co-Operative Banks 4.13 Agree 4.19 Agree 4.24 Agree 3.38 Neutral 4.16 Agree 4.11 Agree 4.31 Strongly Agree It can be concluded from the results that Mahila Urban Co-Operative Banks identifies micro scale enterprise needs; with the help of loan from Mahila Urban Co-Operative Banks women entrepreneurs could develop new enterprise, expand size of their enterprise and expand their enterprise in new locations. The loan facility of Mahila Urban Co-Operative Banks helped women entrepreneurs in improving quality of products, hiring new workers, buying new machineries and setting a new venture. Women entrepreneurs said that raising capital through Mahila Urban Co- Operative Banks is easier than other sources of finance as well as Mahila Urban Co-Operative Banks provided them working capital as and when required. According to respondents Mahila Urban Co-Operative Banks focus more on social collateral vis-à-vis financial collateral which helps in establishing new venture and Financing from Mahila Urban Co-Operative Banks is a less risky mode of raising capital. Conclusion: From this research it can be concluded that Mahila Urban Co-operative Banks are significantly helping in Development of Women Entrepreneurs. These banks are not only granting loans to start a new venture but they are also landing money to women entrepreneurs for improving quality of products, hiring new workers, buying new machineries and enterprise expansion. References: INTERCONTINENTAL JOURNAL OF HUMAN RESOURCE RESEARCH REVIEW 1. Babu, K. J., &Selkhar, B. M. (2012). The Emerging Urban Co-Operative Banks (Ucbs) In India: Problems and Prospects. Journal of Business and Management, 2(5), Giagnocavo, C., Gerez, S., &Sforzi, J. (2012). Cooperative Bank Strategies for Social Economic Problem Solving: Supporting Social Enterprise and Local Development. Annuals of Public and Cooperative Economics, 83(3), Kathiriya, A. D. (2013). Challenges of core banking in co operative banking sector in India. Asian Journal of Research in Banking and Finance, 3(5), Matharu, D., & Kriplani., D. (2014). Indian Women s Bank- an Overview. Shodh Pioneer- Journal Of IT & Management, 10(1), Purohit, G. N., & Jain, M. V. (2013). Role of woman oriented integrated financial services in co-operative banks. Journal of Management, 11(4), icmrrjournal@gmail.com