Professional Documents
Culture Documents
Executive Summary.............................................................................................................2
Introduction:........................................................................................................................3
Research Methodology:.......................................................................................................9
Major Findings:.................................................................................................................21
Bibliography:.....................................................................................................................23
Annexure – I......................................................................................................................24
Project on research methodology
Executive Summary
This project report emphasizes upon mainly to use the research methodology
appropriately for any kind of research. This research emphasise on the savings pattern
and usage of non-life insurance products and preferences in the rural market in India. The
report is based mainly only the primary data which is collected from the rural area near
Sitapur i.e. places like Tedwa, Biswan etc. Certain secondary is also being used to
highlight the rural market and the several tasks performed as per the tradition and culture
of rural area. The report accompanies the major findings, conclusions and
recommendations along with the questionnaire which was used to collect the data from
the rural people. However, due to language barriers was filled by asking them the details.
The rural people were asked about the banking preferences and their trust upon the non-
life insurers present in the rural market.
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Introduction:
WHAT RESEARCH IS
• Attempt to achieve systematically and with the support of data the answer to a
question, the resolution to a problem, or the greater understanding of a
phenomenon
• Redman and Mory define research as a "systematized effort to gain new
knowledge."
• According to Clifford Woody research comprises of defining and redefining
problems, formulating hypothesis or suggested solutions; collecting, organising
and evaluating data; making deductions and reaching conclusions; and at last
carefully testing the conclusions to determine whether they fit the formulating
hypothesis.
WHAT RESEARCH IS NOT
• Research isn’t information gathering:
– Gathering information from resources such books or magazines isn’t
research.
– No contribution to new knowledge.
• Research isn’t the transportation of facts:
– Merely transporting facts from one resource to another doesn’t constitute
research.
– No contribution to new knowledge although this might make existing
knowledge more accessible.
RESEARCH CHARACTERISTIC
• Originates with a question or problem.
• Requires clear articulation of goal.
• Follows a specific plan or procedure.
• Often divides main problem into sub problems.
• Guided by specific problem, question or hypothesis.
• Accepts certain critical assumptions.
• Requires collection and interpretation of data.
• Cyclical in nature.
RESEARCH DESIGN
• Research design is the conceptual structure within which research would be
conducted.
• It constitute the blueprint for the collection, measurement and analysis of data.
• Aids the researcher in the allocation of limited resources by posing crucial choices
in methodology.
• The design decisions happens to be in respect of
• what is study about
• why is study being made?
• Where will be study be carried out?
• What type of data is required?
• Where can the required data be found?
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Think about problem in a broader sense and narrow down the research problem.
• In this form the question has a number of ambiguities such as:
Rethinking and discussions about the problem may result in narrowing down the question
to:
- Which factors responsible for their such saving pattern?
- Why they prefer government than private sector for non life insurance product
SELECTION OF PROBLEM
• Before the final selection of a problem is done, a researcher must ask himself the
following questions:
– Whether he is well equipped in terms of his background to carry out the
research?
– Whether the study falls within the budget he can afford?
– Whether the necessary cooperation can be obtained from those who must
participate in research as subjects?
– The selection of a problem must be preceded by a preliminary study.
– If the answers to all these questions are in the affirmative, one may
become sure so far as the practicability of the study is concerned.
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Rural production and farm incomes in India are frequently affected by natural disasters
such as droughts, floods, cyclones, storms, landslides and earthquakes. Susceptibility of
rural to these disasters is compounded by the outbreak of epidemics and man-made
disasters such as fire, sale of spurious seeds, fertilizers and pesticides, price crashes etc.
All these events severely affect farmers through loss in production and farm income, and
they are beyond the control of the farmers. With the growing commercialization of rural,
the magnitude of loss due to unfavorable eventualities is increasing. The question is how
to protect farmers by minimizing such losses. For a section of farming community, the
minimum support prices for certain crops provide a measure of income stability. But most
of the crops and in most of the state’s MSP is not implemented. In recent times,
mechanisms like contract farming and future’s trading have been established which are
expected to provide some insurance against price fluctuations directly or indirectly. But,
Rural insurance is considered an important mechanism to effectively address the risk to
output and income resulting from various natural and manmade events. Rural Insurance is
a means of protecting the agriculturist against financial losses due to uncertainties that
may arise Rural losses arising from named or all unforeseen perils beyond their control
(AIC, 2008). Unfortunately, rural insurance in the country has not made much headway
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even though the need to protect Indian farmers from rural variability has been a
continuing concern of rural policy. According to the National Rural Policy 2000,
“Despite technological and economic advancements, the condition of farmers continues
to be unstable due to natural calamities and price fluctuations”. In some extreme cases,
these unfavourable events become one of the factors leading to farmers‟ suicides which
are now assuming serious proportions (Raju and Chand, 2007). Rural insurance is one
method by which farmers can stabilize farm income and investment and guard against
disastrous effect of losses due to natural hazards or low market prices. Crop insurance not
only stabilizes the farm income but also helps the farmers to initiate production activity
after a bad rural year. It cushions the shock of crop losses by providing farmers with a
minimum amount of protection. It spreads the crop losses over space and time and helps
farmers make more investments in rural. It forms an important component of safety-net
programmes as is being experienced in many developed countries like USA and Canada
as well as in the European Union. However, one need to keep in mind that crop insurance
should be part of overall risk management strategy. Insurance comes towards the end of
risk management process. Insurance is redistribution of cost of losses of few among
many, and cannot prevent economic loss.
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Research Methodology:
The research methodology will include following steps:
Sample Size: 50
It is proposed to collect primary data from homes of common people through proper
sampling
Sampling Instrument:
• Observation
• Personal Interview
• Telephonic Interview
• Internet feedback
Sample area: Biswan and Near by Area , Sitapur, Uttar Pradesh, India
• Newspaper
• Magazines
• Journals
• Internet
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Today, branches are the primary delivery channel in rural areas. Though there are 32,000
commercial bank branches in India, they cover less than 7% of total villages. Opening
more branches is not necessarily profitable as many pockets of rural areas do not have
business enough to justify an expensive branch channel. Therefore, to improve access in
rural areas, banks need to modify existing channels, introduce new channels and identify
innovative ways to integrate the two.
Fortunately there are a variety of options available for banks looking to modify their
existing channels. To reduce the costs imposed by branches, banks should consider the
option of sharing their branch infrastructure. This would not be too dissimilar to the
example of the telecom industry sharing network infrastructure or the fast food industry
sharing food courts in urban areas. Though infrastructure sharing may raise concerns over
client confidentiality and data leakage, in the long run banks will only benefit from such
collaboration.
ATMs are an effective channel which can deliver many of the services frequently used by
a branch customer. However, ATMs, in their current form, are not suitable for rural areas
as the literacy level and transaction ticket amount is too low. ATMs can, however, be
designed to meet the needs of rural customers. For example, ICICI Bank is working with
IIT Chennai to develop an ATM that has a biometric fingerprint login, accepts soiled
notes, and lower value denominations. In addition to modifying the design of the
machines, banks should also hold discussions with the RBI to allow an attendant to be
posted at ATMs. This will enhance the usability of ATMs.
Though phone banking and internet banking are cost-effective channels, given very low
tele-density and low internet penetration in rural areas, the ability to use these channels to
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reach the rural customer is low. However, phone and internet banking should be
considered once infrastructure and literacy levels improve in rural India. A business
correspondent could then run an e-kiosk to assist customers to transact over these
channels. For example, Centenary Bank in Uganda uses internet and phone banking to
provide bill payments, money transfers and loan repayments.
The RBI allows banks to appoint business correspondents and facilitators to be used as
intermediaries in providing banking services. NGOs, MFIs, Societies, Section 25
companies, registered NBFCs not accepting public deposits, and Post Offices can be
appointed as Business Correspondents. Business Correspondents can provide several
services which are not currently offered by SHGs and MFIs, including: (i) identification
of borrowers and fitment of activities; (ii) collection and preliminary processing of loan
applications including verification of primary information/data; (iii) creating awareness
about savings and other products and education and advice on managing money and debt
counseling; (iv) processing and submission of applications to banks; (v) promotion and
nurturing Self Help Groups/Joint Liability Groups; (vi) post-sanction monitoring; (vii)
monitoring and handholding of Self Help Groups/Joint Liability Groups/Credit
Groups/others; and (viii) follow-up for recovery; (ix) disbursal of small value credit, (x)
recovery of principal/collection of interest (xi) collection of small value deposits (xii) sale
of micro-insurance/ mutual fund products/ pension products/ other third-party products
and (xiii) receipt and delivery of small value remittances/ other payment instruments.
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The introduction of Business Correspondents may face some challenges from labor
unions. However, Diamond believes that there may be some options to address the
concerns of the current workforce while using Business Correspondents to capture more
value from rural customers.
Caixa Economica, a state-owned bank in Brazil, manages the country’s lottery network
and distributes government benefits. To increase the access of its services, Caixa
extensively utilizes the Banking Correspondent channel, with 14,000 banking
correspondents covering all of Brazil’s 5,500 municipalities. In less than 2 years, Caixa
opened about 2.8 million new accounts and estimates that 40% of its banking transactions
are handled through the banking correspondent channel.
Where banks do not find it economical to open full-fl edged branches of satellite offices,
mobile offices may be more appropriate. Mobile offices extend banking facilities through
a well-protected truck or van. The mobile unit visits villages on specified days/ hours.
The mobile office would be affiliated with a branch of the bank, and serve areas which
have a large concentration of villages. This will not be dissimilar to the mobile ATMs
implemented by some of the Indian banks in the urban areas.
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There is no one right channel or solution to improve access in rural areas. Banks have to
evaluate the trade-offs between those channels that are most convenient to customers and
those that are the most profitable. Banks are not comfortable opening new rural branches
because many of those that already exist are unprofitable. Therefore, determining the
right combination of channels is critical to improving access in profitable ways. An
innovative approach to improving access will consider a combination of these channels.
For example:
While this list is not exhaustive, it highlights the need for creative solutions that apply the
right channel to the right market and transaction. In South Africa, Capitec has combined
convenient branches along transportation routes (for example, train and bus stations, and
taxi stops). In addition, it has rolled-out debit cards and automatic teller machines across
200 of these branches to stimulate savings among low-income earners. Between February
and August 2007, the number of customers jumped from around 30,000 to more than
90,000.
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CAMEL INSURANCE
The camels are covered against death due to accident or disease as per Standard Cattle
Insurance Policy. The maximum S.I. is restricted to Rs.3000/-.
PIG INSURANCE
All indigenous, cross-bred and exotic pigs are covered however under scheme category
exotic animals are not covered. The age group is from 4 months to 3 years. The coverage
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is against death due to accident or disease.Exclusions as per Cattle Policy apply here also.
Permanent total disablement, breeding and furrowing risks are not covered. Vaccination
in applicable diseases is compulsory. Evaluation depends upon the age of the animal.
Animals are identified by means of small brass buttons ear tags.
POULTRY INSURANCE
This is also governed by Market Agreement, amongst all the four subsidiary companies.
The policy shall provide indemnity against death of birds due to accident (including fire,
lightning, flood, cyclone, strike, riot and civil commotion and terrorism) or diseases
contracted or occurring during the period of insurance. The word Poultry includes layers,
broilers and hatchery birds, which are exotic and cross-bred.
Indigenous and non-descript birds will not be insured
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ELEPHANT INSURANCE
This scheme is applicable to elephants used for commercial and religious purposes. This
policy covers death due to disease or accident and the coverage is given from 5 to 60
years of age. Identification is done from the records of forest department of the State
Govt. and also by measuring the trunk of each elephant. Valuation of the elephant varies
from breed to breed, area to area and time to time. Exclusions are as per Cattle Market
agreement and some specific exclusion are as per policy schedule. Company indemnifies
the insured only 80% of market value or sum insured whichever is less.
Crop insurance
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Crop insurance is purchased by Rural producers, including farmers, ranchers, and others
to protect themselves against either the loss of their crops due to natural disasters, such
as hail, drought, and floods, or the loss of revenue due to declines in the prices of Rural
commodities. The two general categories of crop insurance are called crop-yield
insurance and crop-revenue insurance.
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Which Bank?
No. of people
50
40
30
Series1
20
10
0
Bhartiya Gramin Bank State Bank of India
Name of the Banks
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Non-life Insurance
No. of people 25
20
15
Series1
10
5
0
Bhartiya Oriental GI United India Reliance GI
Gramin Bank GI
General Insurers
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Major Findings:
1. Rural people do not have many options for savings. Everybody relies on the
Gramin Bank for savings account. Moreover they are not literate.
2. Only literate people present in rural areas open their bank accounts in State Bank
of India in city branch.
3. For non-life insurance generally rural people rely on Government banks i.e.
Gramin Banks. Others who are literate take help of some other insurers.
4. Crop Insurance and other major insurance is taken care by Government itself so
rural people never get to know about from which authority they are getting their
insurance done.
5. There are lot of opportunities for private as well as public sector to explore the
rural market.
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Bibliography:
• Rural Marketing: Indian Perspective By Awadhesh Kumar Singh
• Rural Marketing: Targeting the Non-urban Consumer By Sanal Kumar
Velayudhan
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Annexure – I
Schedule/Questionnaire
1) Name: ___________________________________________________________
3) Occupation: ____________________________________
7) Name of non-life insurance company (where all non-life insurance is being done)
___________________________________________________________
___________________________________________________________
___________________________________________________________
___________________________________________________________
Government
Private
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