The Reserve Bank of India Act, 1934 and the Banking
Regulation Act, 1949, govern the banking operations in India.
Banking Regulation Act of India, 1949 defines
Banking as “accepting, for the purpose of lending or
of investment of deposits of money from the public,
repayable on demand or otherwise or withdrawable
by cheque, draft order or otherwise.”
6. History Of Banking
Banking begins with the first prototype banks
of merchants of the ancient world.
Began around 2000 BC in Assyria and Babylonia.
Lenders of ANCIENT GREECE started
accepting deposits and changed money.
In Italy it began in 11th century.
Italy was a biggest Europion trade center.
Here banking started because of Circulation of different currency.
Different Types Of Banks
Types of Banks
Central Bank (RBI)
10. Commercial Banks
• Commercial banks comprising public
sector banks, foreign banks, and private
sector banks represent the most important
financial intermediary in the Indian
The changes in banking structure and
control have resulted due to wider
geographical spread and deeper
penetration of rural areas, higher
mobilization of deposits, reallocation of
bank credit to priority activities, and
lower operational autonomy for a bank
Private Sector ,
– These banks play a vital role in mobilizing savings and
stimulating agricultural investment. Co-operative credit
institutions account for the second largest proportion of
44.6% of total institutional credit. The co-operative sector
is very much useful for rural people. The co-operative
banking sector is divided into the following categories.
Punjab And Maharashtra Co-op bank
Citizen Credit Co-op bank
State Co-operative Banks
Central Co-operative Banks
Primary Agricultural Credit Societies
Land Development Banks
State Land Development Banks
– A development bank may be defined as a financial
institution concerned with providing all types of financial
assistance to business units in the form of loans,
underwriting, investment and guarantee operations and
promotional activities-economic development in general
and industrial development in particular
– A term lending institution. It is a multipurpose financial
institution with a broad development outlook.
– The industrial finance corporation of India, the first
development bank was established in 1948. Subsequently
many other institutions were set-up.
Ex. IDBI, IFCI, SIDBI
Functions of Development Banks
– Fostering industrial
– Providing Long term
– Balanced development
– Providing Promotional
– Infrastructure building
– Fulfilling Socio
– Meaning: Financial
intermediaries that acquire
the savings of people and
direct these funds into the
seeking capital for the
acquisition of plant and
equipment and for holding
inventories are called
– Features: Long term
– Functions: Capital
Purchase of securities,
Selling of securities,
Advisory services, Acting
• Meaning: Institution that
render wide range of services
such as the management of
counseling, insurance, etc are
called ‘Merchant Banks’.
• Functions: Sponsoring
issues, Loan syndication,
Servicing of issues, Portfolio,
management, Arranging fixed
deposits, Helps in merger&
• SBI IN 1972
18. 4Types of banking services
-Debit / Credit Card
-Online Bill Pay
19. TOP 3 Banks In India
-Serving customers since 1955.
-Net Profit for 2014 Rs.13101.57 Cr.
-Serving customers since 1994.
-Net Profit for 2014 Rs.7,488 Cr.
-Serving customers since 1894.
-Net Profit for 2013 Rs.4,748 Cr.
20. The Role of RBI
• The Reserve Bank of India (RBI) is
the central bank of India, and was
established on April 1, 1935 in
accordance with the provisions of the
Reserve Bank of India Act, 1934.
Since its inception, it has been
headquartered in Mumbai. Though
originally privately owned, RBI has
been fully owned by the Government
• RBI is governed by a central board
(headed by a Governor) appointed by
the Central Government.RBI has 22
regional offices across India.
22. A. Bank B. Mutual funds
C. Tin Can in your basement or
Under your bed
If you had
would you save
it until you
23. Common Banking Products Available
Debit & Credit Card
Automatic Teller Machine
Electronic Funds Transfer (EFT)
Deposits, Loans, OD,
Insurance, promissory notes, drafts
Trading of shares, Underwriting, Portfolio mgmt
24. BASEL Framework
Bank for International Settlements (BIS)
Established on 17 May 1930, the BIS is the world's oldest
international financial organization. It has its head office in Basel,
BIS fosters co-operation among central banks and other agencies in
pursuit of monetary and financial stability.
It fulfills this mandate by acting as:
A forum to promote discussion and policy analysis among central
banks and within the international financial community.
A centre for economic and monetary research
A prime counterparty for central banks in their financial transactions
Agent or trustee in connection with international financial
Many banks have modernized their services with
the facilities of computer and electronic
The electronics revolution has made it possible to
provide ease and flexibility in banking operations
to the benefit of the customer.
The e-banking has made the customer say good-
bye to huge account registers and large paper
“Banks Moving From Branch Based To Internet Based
28. Revolutions In Indian Banking
Industry Transforming Life Of Millions
Core Banking Solution (CBS)
MICR and automated cheque clearing
As stated by Ms Shikha Sharma, MD and CEO of Axis Bank, “As far as retail banking is concerned,
technology would help in building confidence at a low cost. Overall, technology would help to
solve complex trade-offs in the future”, we can see the amount of dependency banking industry
is showing on IT.
29. Revolutions In Indian Banking
Industry Transforming Life Of Millions
Automated teller Machines
Smart Cards (Debit & Credit Cards)
EFT (Electronic Fund Transfer)
India is a nation of great savers and not investors.
Banks has grown up in past centuries which has a E-future.
Branch based banking is becoming Internet based banking.
Banking is not just a concept to know but also a way to earn money.
“Put money in the market, not in your bank account or under your bed.
Don’t let money be idle. Let your money work for you, don’t work for your money.”
-Head Personal Investment Counsulting, IIFL