BANKING
MEANING OF BANKING
1) The Banking Industry in India is mainly governed by the Banking Regulation Act, 1949.
2) According to the Banking Regulation Act 1949, "A banking company means any company which transacts the business of banking. Banking means the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdrawable by cheque, draft or otherwise.
3) The banking sector acts as a backbone of Indian economy which reflects as a supporter during the period of boom and recession.
4) From 1991 various trends and development in banking sector are credited.
5) It also reflects the various reforms were caused to improve their services to satisfy the customers.
6) A commercial bank is a financial intermediary which accepts deposits of money from the public and lends them with a view to make profits.
STRUCTURE OF BANKING SYSTEM IN INDIA
1) Banking development in India after Independence has been, by and large, a state induced activity.
2) At present, India has a well-developed banking system with large number of banks public sector banks, private sector banks, foreign banks, regional banks and co-operative banks with RBI as the head of banking system.
3) The RBI was nationalized in 1949 followed by the nationalization of Imperial Bank of India in 1955.
4) In July, 1969, 14 major commercial banks were nationalized and in April 1980, 6 more commercial banks were nationalized.
5) Banking Industry in India functions under the umbrella of the RBI.
6) Under the Banking Regulation Act 1949, RBI received wide range powers in regards of establishment of new banks, merger and amalgamation of banks, opening and closing of bank branches, inspection of banks etc.
7) Commercial banks are classified into scheduled and non-scheduled banks.
8) Scheduled banks are those which are included in the second schedule of Banking Regulation Act, 1949, others are non-scheduled banks.
9) Scheduled banks are required to maintain a certain amount of reserves with the RBI, they in return, enjoy the facility of financial accommodation and remittance facilities at concessional rates from RBI.
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