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HISTORY OF INDIGENOUS BANKING : The indigenous bankers who belonged to different communities lent money on the security of jewels and also on promissory notes. They functioned both in urban and rural areas. Most of the loans were short-term, repayable with interest after the harvest of the crops, either in one or more installments. The conditions were informal in that the loans could be obtained at any time and without any security depending on the confidence and the relationship of the lender with the borrower. Nevertheless, money-lenders and pawnbrokers have a great hold over agriculturists and others, and their success lies in their intimate knowledge of their customers. Besides the terms are mostly informal and there is no hard and fast rule about the security or interest. MONT-DE-PIETE: Called as Pawn office, set up by the French, by means of an ordiance dated 1 May 1827 initially at Pondicherry and setup similar institution at Karaikal under the arretes of 29 July, 1907. The Institution was provided with necessary funds from the reserve fund. It rendered great service to the needy sections of the population and notably the small agriculturists by providing them advances at reasonable rate of interest. The institution gave loans from Rs.3 to Rs.3,000 on the security of jewels and silver articles depending on the value of the security, the amount of loan ranging from 1/4th to 4/5th of the total value of gold ornaments or silver articles, as the case may be. The rate of interest fixed at 8 percent per year. As the institutions had only limited resources at their disposal, they were unable to meet the credit requirements of the people. PONDICHERRY POWNBROKERS ACT based on the Madras Pawnbrokers Act, 1943 was passed in 1966 with slight modifications to meet the local requirements and brought into force on 15 October, 1966. The USURIOUS LOANS ACT, 1918 (Central Act) extended to this Territory in 1966 was brought into force on 1 September 1970. THE PONDICHERRY MONEY-LENDERS ACT, 1970 (26 of 1970) which sought to regulate and control the business of money-lending by introducing the system of registration was assented to on 19 August 1970 and made applicable to Karaikal region with effect from 1st October, 1970. The Tahsildars and Deputy Tahsildars function as Inspectors under the Acts with power to inspect the accounts of the licensees periodically and to take legal action against offenders. THE INDIAN BANK SURVEY IN 1970, revealed that there was a good cause for establishing several branches of COMMERCIAL BANKS in the Territory. Moreover, it would be to the mutual benefit of the banks and the public if commercial banks could take to small lending's against mortgage of jewels and utensil in a big way. This would free the people from the the exploitation of pawnbrokers and it would also promote the banking habit among the lower strata of people.
GENERAL CREDIT FACILITIES
JOINT STOCK BANKS: With the extension of the BANKING COMPANIES ACT, 1949 and the
FOREIGN EXCHANGE REGUALTION ACT, 1947, to Pondicherry in 1954 the stage
was set for Indian Banks to open their branches in this Territory.
A branch of UNITED COMMERCIAL BANK was opened in Karaikal on 10 August, 1973. The bank extends every kind of banking facility to the public.
As on 31 December 1975, three branches of the INDIAN OVERSEAS BANK were in operation in Karaikal region viz. Karaikal, Thirunallar, and Thirumalairajanpattinam.
As on 31-12-1975, THE STATE BANK OF INDIA, INDIAN BANK, CANARA BANK are also having branches in Karaikal.
Besides these banks, The Lakshmi Vilas Bank Ltd. has also opened its branch. All the branches of the banks are having Savings Account, Recurring Deposit Account, Current Account, Term Deposit, Cummulative Deposit Schemes, etc.
Most of the banks are having facilities of foreign exchange, agricultural finance. Farmers were advanced liberal loans for the purchase of pump-sets, tractors, etc., and towards crop loans. Proposals for loan from small and big industries, professional men, self-employed persons, etc. are entertained. Village Adoption Scheme, Lead Bank Scheme sponsored by the Reserve Bank of India for provision of comprehensive credit to small farmers, and Consumer Credit-Installment Loan Scheme are provided by these banks. Assists import and export trade, deals pledge of gold ornaments, etc. Travellers Cheques, Letters of introduction are available. Credit Card System, and ATM are introduced in some banks. Housing Loans Schemes are now familarising in the Banks.
The Depositors are mostly middle class businessmen, salaried persons and French pensioners, educational and religious institutions apart from the Government transactions and deposits, etc. Most of the depositors, belong to the low income group as well as the salaried middle income group besides small organisations. Agriculturists in selected villagers.
The public have not in general taken to the banking habit. While the public have shown great enthusiasm to avail of loan facilities from the banks, they have not shown the same degree of enthusiasm to deposit their surplus funds in the banks. However, most of the NRIs are interested to settle in Karaikal region and the NRI deposits are now filling the Bank deposits more than the expectations.
CO-OPERATIVE CREDIT BANKS and SOCIETIES are also meet the long term / short term credit requirements of the public / ryots in this region.PRIVATE BANKS, such as the Kumbakonam parspara sagayanithi limited, etc, are also functioning.
COOPERATIVE CREDIT SOCIETIES AND BANKS : The small farmers and tenant holders badly needed finance to carry on their agricultural operations. They also had to withstand the effects of droughts and floods from time to time. All these factors placed the small farmers at the mercy of the money-lenders. Thus the introduction of cooperative institutions in the Territory came as one of the salutary results of merger. The cooperative credit system in the Territory is built upon a two-tier structure i.e., the Apex Financing Agency at the top and the credit societies at the primary level.
THE PONDICHERRY STATE COOPERATIVE BANK LIMITED was duly registered on 10 October 1958. The bank started functioning from 30th October 1958, which has jurisdiction over the entire Territory is the Apex Cooperative sector channeling the funds received from the Reserve Bank of India to the affiliated credit societies at a lower rate of interest. It provides short term and medium term agricultural loans to the agriculturists through its affiliated societies. The bank also issues medium-term loans for non-agricultural purposes to public servants through the affiliated staff cooperative societies to a limited extent.
AGRICULTURAL CREDIT SOCIETIES, FARMING SOCIETY, MARKETING SOCIEITES, PRIMARY COOPERATIVE BANKS, NON- AGRICULTURAL CREDIT SOCIETIES, CONSUMER STORES SOCIETIES, WEAVERS SOCIETIES, INDUSTRIAL SOCIETIES, HOUSING SOCIETIES, and OTHER TYPES OF SOCIETIES were affiliated to the bank.
GENERAL & LIFE INSURANCE
LIFE INSURANCE : After the formation of LIFE INSURANCE CORPORATION OF INDIA in
September, 1956, the Servicing Branch of Nagapattinam under the
Controlling Divisional Office at Thanjavur, Karaikal has been provided
all services by the LIC. However, a separate servicing branch has also
been opened some years ago in Karaikal which is more helpful to the
people of Karaikal.
SSS: The Salary Savings Scheme was introduced benefiting government employees. The Salary Savings Scheme is not only applicable to government servants but also to the employees of mills, local bodies, etc.
UTGEIS: A special scheme for the Union Territory Govt. Employees Insurance Scheme has been introduced and functioning for the welfare of Govt. employees.
LIC introduced Income tax benefit schemes which are familiar to the Medium and High Income Group people.
Housing Scheme is now very popular. Under this scheme purchase of plots, construction of new house building, purchase of ready built building, re- constructing of old building, etc. schemes are available. Special and attractive Schemes for NRI also available.
GENERAL INSURANCE : General insurance companies operated in various parts of India for the purpose fire and transit insurance for house and other buildings have not branches in Karaikal. However, the NEW INDIA ASSURANCE COMPANY having its branch and provide service on motor insurances for the various fleet owners and individual vehicle owners among government officials and general public.
Pondicherry administration initiated several measures to speed up
the industrial development of the Karaikal region under the SINGLE WINDOW
SYSTEM. The establishment of an INDUSTRIAL ESTATES to encourage the
growth of small scale industries. Providing financial aid to industries
should be passed as early as possible for the purchase of land,
construction of factory building, purchase of tools, equipment,
machinery, and also provided for the payment of a subsidy on interest.
An act also passed in this regard called PONDICHERRY STATE AID TO
INDUSTRIES ACT, 1970.
THE INDUSTRIAL DEVELOPMENT BANK OF INDIA AND THE INDUSTRIAL FINANCE CORPORATION OF INDIA, extended refinance facility to industrial units in the Territory. Also offer a lower rate of interest, longer moratorium and amortisation periods and accept a lower margin of security.
PONDICHERRY INDUSTRIAL PROMOTION, DEVELOPMENT AND INVESTMENT CORPORATION LIMITED (PIPDIC): This Corporation was incorporated under the Companies Act, 1956, on 17 April 1974. Its objective is to work for the industrial development of the Territory. The Corporation is managed by a Board of Directors appointed by the Lieutenant-Governor. The implementation of the Central Government's outright grant or Capital Subsidy Scheme was handed over to this Corporation. Schemes for financial assistance to small, medium and large-scale industries as well as technocrats have also been formulated by the Corporation.
OUTRIGHT GRANT: Following the declaration of the entire Union territory as an industrially backward area in September, 1971, entrepreneurs became eligible for certain concessions under the Central Government's outright grant or subsidy scheme.
Arrangements were made in to register small-scale industrial units with the Directorate General of Supplies and Disposal through the National Small Industries Corporation and Small Industries Service Institute in order to help them market their products.
CONSULTANCY SERVICE: Services of experts of the various Regional Productivity Councils of the National Productivity Council and other Organisations which offer consultancy services are made available to small-scale units in the Territory.
RAW MATERIAL DEPOT: This helps secure priority allocations for industrial and scarce materials.
SALES TAX EXEMPTION/CONCESSION: The Govt. gives exemption from the payment of sales tax and further reduced by half the central sales tax payable in respect of all goods manufactured by small-scale industries under certain conditions.
REMISSION OF STAMP DUTY : This Administration have also exempted all types of industries from payment of stamp duty for deeds executed in favour of the PIPDIC.
EXEMPTION OF REGISTRATION FEE: Small-scale industries in Pondicherry are exempted from the payment of registration fee under certain conditions.
POWER SUBSIDY: The administration had announced a scheme of power subsidy for low tension and high tension power consuming industries.
MISCELLANEOUS CONCESSIONS: Facilities like hire-purchase of machineries, Price preference, Industrial tour for getting technological advances.
In Karaikal region, the functions for the NATIONAL SAVINGS
ORGANISATION, are performed by the Assistant Regional Director, Trichirapalli, and the District Savings Officer, Nagapattinam.
STATE ADVISORY BOARD: Constituted to advise and guide the administration to popularise the small savings with the Chief Secretary as Chairman and the Finance Secretary as Vice-Chairman.
OPERATION SCHEMES: In Karaikal region all the Sub-Post Offices, and Branch Offices render the savings bank facilities.
Fixed Deposit Scheme, The Cumulative Term Deposit Scheme, Cash Certificates are introduced for the inducement of Small Savings.
The chit fund locally known as ceetu serves both as a profitable
avenue of investments and a convenient method of small savings.
To have effective control over the functioning of the chit fund companies and to safeguard the interests of the subscribers, the Pondicherry Chit Funds Act, 1966 was passed . This Act, which provided for measures to regulate chit funds, was brought into force on 1st August, 1977.
In Karaikal, The Mayavaram Chit fund ltd, Visalam Chits, etc., are functioning. In addition to the chit fund companies mentioned above, there are also some vessel, furniture, Gold ornaments, and other merchants who run chits. The difference is that the prize winner gets the prize in kind of terms of the agreement and once having won the prize, the subscriber is not required to pay his subscription any further. The Chit Funds Act does not cover this kind of chits.
With merger, THE INDIAN COINAGE ACT, 1906, THE RESERVE BANK OF
INDIA ACT,1934 AND THE CURRENCY ORDIANCE OF 1940 were extended to the
Territory with effect from 1 November, 1954. With the extension of these
Acts, Indian coins, one rupee notes and bank notes issued by the Reserve
Bank of India formally became legal tender in the French establishments.
Foreign currencies brought by the NRIs have also been exchanged in the Selected branches of the Scheduled Banks.
EXPORT AND IMPORTS IN OLDEN DAYS:
Rice was lifted chiefly from Karaikal. Pottery, ground-nut oil,
oil, small quantities of coconuts, tamarinds, onions, tannin, dyes,
coconut oil, chillies, coriander and gingelli were also exported. The
export from Karaikal was about one-nith of the total sea-borne trade.
Imported Petroleum served as a depot for the surrounding districts. Smaller imports included wines, spirits and other liquors,coal, cotton thread, jute bags and grains. A large proportion of the import trade was with the British Empire and a small proportion with France and the French possessions.
Gold which fetched a much higher price in India than in French India was taken to the frontier in larger quantities. Gold and Diamond were imported through official channels paying customs duty which was nominally increased subsequently to improve the revenues. These were smuggled to the Indian Union. In turn, more Indian rupees from Pondicherry reached Hong Kong and the Persian Gulf wherefrom gold was brought.
AFTER MERGER : The Import and Export Control Act, 1947 was extended to these establishments with effect from 1 November, 1954. Import and export licences were granted in accordance with the policy announced by the Indian Government from time to time on an all-India basis.
A Special Additional Licensing Scheme was introduced for the first time during the January-June 1955 period. The main items of imports under this scheme were electrical instruments, motor starters, house service meters, betel-nuts, cloves, chemicals, drugs and medicines and other consumer items imported in terms of the quota system.
Presently, the traders know the modern technique of trading method and at present in Karaikal various kind of products such as, ornaments, furniture, CTV, Fridge, Electrical and Electronic goods, Medicines, Automobiles and its spares, Rubber Products, Plastic goods, Building materials, Bakery, Sweets, Food-items, Household articles, etc. are selling in Karaikal.
This Administration also paved the way for increasing the Trading activities by conducting VANIGA VIZHA, etc.
The system of levying customs duty to regulate the movement of
goods across the borders was in force very early times.
With de facto merger a Collectorate of Customs and Central Excise started functioning with headquarters at Pondicherry. At Karaikal a Central Excise Range in charge of an Inspector assisted by a sepoy has been constituted.
Even though some other marketable centres situated in the adjourning Tamil Nadu State boundaries, Karaikal is the most important for trading activities because of having unique features in the field of cultural and literal society. Having its administration which is also helps between the consumers and the traders.
The Pondicherry Weights and Measures (Enforcement) Rules were
brought into force with effect from 10 August 1968 replacing the Madras
Weights and Measures Rules till then in force.
The Office of the Assistant Controller of Weights and Measures and Legal Metrology was formed with responsibility to deal with all matters connected with Weights and Measures and Excise under the Administrative control of the Revenue Development Department.
Karaikal is having a good trade associations in various types of
trading activities. The Karaikal Chamber of Commerce has been established
recent years ago and functioning smoothly.
About trade news, some of the free issue news-papers are guiding the consumers for shopping. Also, advertised through All India Radio (FM) channels, Local cable TVs etc.,