Not long ago, the Jharkhand State Cooperative Bank Ltd (JSCB) was on the brink of collapse. Mounting losses, an alarming 52% non-performing asset (NPA) ratio and a credit-deposit (CD) ratio stuck at a mere 16% painted a grim picture. By 31 March 2019, the bank’s accumulated losses had soared to ₹148 crore, making survival seem uncertain. Yet, within just five years, JSCB achieved what seemed impossible—transforming itself into a profitable institution with improved financial stability and operational efficiency.

So, how did this struggling bank script one of the most remarkable turnarounds in India’s cooperative banking sector?

Strategic Overhaul Begins

The revival of JSCB was not accidental it was the result of a meticulously crafted turnaround strategy, implemented with discipline and commitment. This included financial restructuring, governance reforms, operational efficiency improvements and strong support from regulatory bodies like NABARD and RBI.

One of the first major steps was the infusion of ₹67 crore in grant assistance from the Jharkhand government. NABARD also stepped in with critical financial backing, increasing its refinance support from a mere ₹2 crore in 2021 to a staggering ₹870 crore in 2024. Moreover, JSCB secured RBI’s approval to participate in an ₹800 crore food consortium, opening new avenues for revenue generation.

Reshaping Banking Operations

A crucial aspect of JSCB’s transformation was the rigorous implementation of a Turnaround Action Plan developed in consultation with NABARD. This plan aimed at:

• CASA (Current and Savings Account) deposits were actively mobilised, increasing from 54% to 60% over five years, thereby reducing the cost of funds. Loans and advances surged from ₹288 crore in 2019 to ₹1,111 crore in 2024, strengthening revenue streams.
• The bank aggressively pursued loan recoveries through One-Time Settlement (OTS) schemes and strict follow- ups with borrowers. As a result, the gross NPA ratio plummeted from 52% to just 9%, while the net NPA fell from 20% to a mere 3%.
• The CD ratio improved from 16% in 2019 to 47.03% by 31 March 2024—well above NABARD’s benchmark of 40%.

Leadership that Made the Difference

While financial strategies played a key role, governance reforms under Chairperson Bibha Singh proved to be a game-changer. She led the Board of Directors in making proactive policy decisions—streamlining operations, optimising staff allocation and fostering better coordination with NABARD and RBI.

Under her leadership, JSCB achieved a milestone that once seemed far-fetched: complete elimination of accumulated losses by 30 September 2024. The bank, which had been drowning in ₹88.77 crore in losses as of March 2023, reported a profit of ₹6 crore within just 18 months.

Numbers Tell the Story

By 31 March 2024, JSCB had firmly positioned itself as a strong and stable financial institution:

• From a loss-making entity to a profitable bank with ₹6 crore in profits.
• Net NPA reduced to just 2.76%.
• Capital to risk-weighted assets ratio (CRAR) surged to 24%, ensuring long-term sustainability.
• The provisioning coverage ratio (PCR) improved from 65% to 71%, reducing credit risks.

The transformation of JSCB is not just a success story—it’s an inspiration for other cooperative banks facing financial distress. Through strategic planning, bold leadership and unwavering commitment, JSCB proved that even the most struggling institutions can bounce back.

How Jharkhand’s Villages Got a Financial Makeover

Imagine living in a village where the nearest bank is miles away and getting cash means an entire day’s journey. Now, imagine if the bank came to you instead. That’s exactly what happened in rural Jharkhand when the Financial Inclusion through Business Correspondents (FI-BC) project kicked off in 2014.

With a simple idea—taking banking to the people—Jharkhand State Cooperative Bank Limited (JSCB) set out to change the financial landscape of the state’s remotest corners. The plan? Deploy Business Correspondents (BCs) armed with tech-savvy banking devices to make deposits, withdrawals and even government benefits available right in the villages. Sounds simple, right? Well, not quite. But let’s rewind a bit.

Banking on the Go

At first, there were 1,800 Business Correspondents selected from local cooperative societies like LAMPS and PACS. These BCs were given tablets, biometric scanners and Bluetooth printers to start their banking missions. The idea was to allow people to open accounts, deposit and withdraw money, transfer funds and check balances—all without stepping into a bank branch.

But technology doesn’t stay still. By 2016, JSCB introduced Point of Sale (PoS) machines to make transactions even smoother. Then came Micro ATMs in 2017, which were faster and more efficient. By 2023, these were upgraded to advanced cybersecurity-compliant versions, ensuring that every transaction was safe and secure.

More than Just Banking

The initiative wasn’t just about banking—it was about empowering communities. Farmers, fishermen and dairy societies were brought into the system, aligning with the government’s vision of ‘Sahkaar se Samriddhi’ (Prosperity through Cooperation). And in a move that particularly helped the elderly and differently-abled, JSCB launched doorstep banking—so the bank quite literally came to people’s homes.

Hurdles Along the Way

Of course, launching a project like this wasn’t without its headaches. For starters, there were regulatory approvals—a mountain of paperwork and red tape to wade through. Then there was the challenge of picking cost-effective yet high-tech devices that met security standards. Training BCs was another uphill task—after all, they weren’t just handling money but were also educators, helping villagers understand digital banking and savings.

And then there was cybersecurity. With financial frauds on the rise, ensuring safe transactions in rural areas was crucial. But with careful planning, strict security measures and continuous tech upgrades, JSCB tackled these challenges head-on.

Effect of Change

So, what did all this effort lead to? A financial revolution in rural Jharkhand.

• Over 3 lakh people who had never had a bank account were now financially included.
• Employment for 1,800 youth as Business Correspondents, giving them a sustainable livelihood.
• Increased savings and financial stability for rural households.
• Doorstep banking for the elderly and disabled, making banking truly accessible.
• Strengthened JSCB’s position as a leader in financial inclusion.

And that’s not all—JSCB isn’t stopping here.

Plans are already in motion to launch a Daily Deposit Scheme to encourage small savings, introduce PMJJBY and PMSBY insurance schemes for social security and expand card and Aadhaar-based banking services. In short, the goal is to make digital banking a way of life in rural Jharkhand.

By combining technology, local engagement and government support, JSCB has proved that banking isn’t just about branches—it’s about people. And if this journey shows anything, it’s that when innovation meets determination, even the most remote villages can become part of India’s financial ecosystem.