A Study of Non-Performing Assets of District Central Co-Operative Banks in Rajasthan

The Banking sector is a key financial service sector supporting development plans through channelizing funds for productive purposes, intermediating flow of funds from surplus to deficit units and supporting financial and economic policies of government, but Non-Performing assets had been the major cause of worry in the banking industry. At present NPA reduction is an indispensable issue in the banks. A strong cooperative banking sector is important for successful country's economy. In this paper an attempt has been made to study the management of NPA, and factors contributing to NPA in Co-operative banks of Rajasthan. A survey has been conducted to know the responsible reasons of NPA in District Central Co-operative banks of Rajasthan. Through this we have found that at the appraisal stage absence of right to select borrower was the main responsible reason, at the sanction & disbursement stage bank officials are facing some problems like incomplete and defective legal documentation, political pressure etc. and at the post disbursement stage the main reasons of NPA are Non-submission of stock and other required periodical statements by the borrowers, diversion of funds. Proper monitoring is not there