Cooperative Banking Pdf notes

Diploma in Cooperative Management

Cooperative Banking

Topics covered:

1. Purpose and structure of co-op banking

  • Purposes of co-op banking
  • Structure of co-op banking in Kenya
  • Organisation charts of various co-op financial organisation
  • Roles of various financial organisations in the co-op sector.

2. Credit programmes and policies

  • Definition of the term credit
  • Sources of loaniable funds
  • distinction between production and consumption loan credit programmes
  • conditions for participation in credit programmes
  • criteria for classification of loans
  • credit policy for union banking section and Saccos

3. Loan package of loan funds

  • what is a loan package
  • preparation of loan package and loan priority list
  • importance of loan package and priority list

4. Acquisition of loan funds

  • procedure for loan application in co-op bank of Kenya
  • Union banking section
  • member qualification
  • upper loan limit
    i. Short term
    ii. Medium term (phase I)
    iii. Medium term (phase II)
  • Contents of loan application form
  • Loan granting procedure

5. loan withdrawal and recording procedure

  • withdrawal procedure
  • loan recording
  • loan reconciliation

6. loan repayment

  • explanation of loan terms
  • causes of loan default
  • minimisation of loan default
  • consequences of loan default

7. co-operative saving scheme

  • Meaning of co-op saving scheme
  • Historical background of co-op saving scheme
  • Purpose of co-op saving scheme
  • conditions for participations in co-op savings scheme

8. Union banking system

  • Factors necessary for establishing a UBS
  • Visibility studies for UBS
  • Centralised and decentralized members savings
  • Advantages and disadvantages of centralised and decentralized banking system

9. Union banking services

  • Savings account services
  • Conditions for opening and operating savings a/c
  • Members savings account and members personal account
  • opening of a member savings a/c, personal a/c
  • posting of transactions of members savings a/c and members personal/c

11. Reconciliation

  • Definition of the term reconciliation
  • importance of reconciliation
  • opening and posting into various a/cs

12. liquidity and investment

  • Meaning of the term liquidity
  • preparation of cash inflow and cash outflow
  • calculation of liquidity margin
  • action taken on the basis of above calculations
  • priority consideration in investment

13. Profitability margin

  • explanation of profitability margin
  • sources of capital in the UBS
  • calculation on rate of returns on capital utilised
  • composition of capital utilised
  • calculation of cost of capital employed
  • calculation of the grass interest margin
  • actions arising from the gross interest margin

14. Security Arrangements

  • Physical security measures in the UBS
  • Control measure in the UBS
  • Insurance requirement in the UBS

15. Structure and Daily Operations Of Saccos

  • Functions/roles of various people in the Saccos

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