DEFINITION OF BANKING Banking Regulation Act 1949 defines banking as, “ACCEPTING FOR THE PURPOSE OF LENDING AND INVESTMENT, OF DEPOSITS OF MONEY FROM THE PUBLIC, REPAYABLE ON DEMAND, ORDER OR OTHERWISE AND WITHDRAWABLE BY CHEQUE,DRAFT,ORDER OR OTHERWISE”.
BANK IS PART OF FINANCIAL SY STEM Financial system is one whichsupplies the necessary financial inputs for theproduction of goods and services. Economicdevelopment of any country depends upon theexistence of well organized financial system.
Financial systemFinancial assets BFinancial intermediaries A N Financial markets K S Financial instruments
BANKING SY STEM There has been a rapid development in the banking institutions in various countries. With development, various systems ofbanking have come into existence. Banks can be classified on the basis of volume of operator, business pattern & areas of operations.
FUNCTION OF CENTRAL BOARD & LOCAL BOARD FUNCTION OF CENTRAL BOARD: General superintendence and direction of the bank’s affairs. FUNCTIONS OF LOCAL BOARD: Advise to the Central Board and economic interest of local co-operative indigenous bank.
FUNCTIONS OF RBI TRADITIONAL FUNCTION PROMOTIONAL FUNCTION SUPERVISORY FUNCTION
TR A D ITIONA L FU N C TION Monopoly of currency notes issue. Banker to government (both central &state) Agent & Advisor to Government Banker to Banker’s Act as clearing house of country Lender of last resort Controller of credit Custodian of foreign exchange reserves.
PROM OTIONA L FU N C TION Promotion of banking habit andexpansion of banking system Provider refinance for expert promotion Expansion of facilities for provision ofthe agricultural credit through NABARD Extension of n facilities for SBI Helping Co-Operative sector Prescribe minimum statutoryrequirement. Innovating new banking businesstransactions.
S U P E RV I S I O RY F U N C T I O N Granting license to banks Inspects and makes enquiry in varioussection of RBI and banking regulations. Implement deposit insurance scheme Periodical review of work of thecommercial bank Giving directives to commercial bank Control non banking finance corporation Ensuring health of financial corporationsystem through on site & offsiteverification.
STATE BANK OF INDIA ACTSAS AGENT OF RESERVEBANK OF INDIA.
EVOLUTION OF SBIEVOLUTION OF SBI CAN BE TRACED BACKTO THE FIRST DECADE ON 19TH CENTURY.IT BEGAN WITH ESTABLISHMENT OFTHE BANK OF CALCUTTA ON 2ND JUNE 1806.ON 2ND JANUARY 1809 RENAMED AS THEBANK OF BANGAL.
FIRST JOIINT STOCK BANK INBRITISH INDIA ESABLISHEDUNDER THE SPONSORSHIP OFGOVERNMENT OF BENGAL.FOLLOWED BY BANK OFBENGAL: BANK OF BOMBAY-15THAPRIL1840 BANK OF MADRAS-1ST JULY1843THESE THREE DOMNIATEDMODERN BANKING SCENARIO ININDIA.
THREE BANKS WEREAMALGAMATED TO FORM THEIMPERIAL BANK OF INDIA ON27TH JANUARY 1921.TO SERVE THE ECONOMY INACCORDANCE WITH FIVE YEARPLAN (1951), THE ALL INDIARURAL CREDIT SURVEYCOMMITTEE PROPOSED THETALE OVER OF THE IMPERIALBANK OF INDIA.
AN ACT WAS PASSEDIN PARLIMENT OF INDIAIN MAY 1955 . AS ARESULT THE STATE BANKOF INDIA WASESTABLISHED ON 1STJULY 1955.
ON 1959 SBI [SUBSIDARYBANKS] ACT WAS PASSED. IT ENABLED THE SBI TOMAKE EIGHT STATEASSOCIATED BANKS ASITS SUBSIDIARIES.
SUBSIDIARIES OF SBI:STATE BANK OF BIKANER & JAIPURSTATE BANK OF HYDRABADSTATE BANK OF MYSORESTATE BANK OF PATIALASTATE BANK OF TRAVANGORE
P RO D U C T S & S E RV I C E S O F S B I E-TICKETING SBI E-TAX EZTRADE @ SBI RTGS/NEFT E-PAYMENTS FUND TRANSFER THIRD PARTY TRANSFER DEMAND DRAFT
CHEQUE BOOK REQUEST ACCOUNT OPENING REQUEST ACCOUNT STATEMENT TRANSACTION ENQUIRY DEMAT ACCOUNT DONATION STATE BANK VIRTUAL CARD GREEN CHANNEL COUNTER KIOSK BANKING SYSTEM
RECENT TRENDS IN COMMERCIAL BANKINGBANKING SECTOR IS THE HEART OFECONOMY.IN 1969, 14 BANKS WERENATIONALISED AND FOLLOWED BY 6BANKS IN 1980.BANKING SECTOR WERE FULLYCOMPUTERISED IN 1985.SOME OF THE RECENT TRENDS ::
NET BNKING It is also known as Internet banking or Online Banking. It is the process of conducting Banking transactions over the internet.
MOBILE BANKING It is also known as M- Banking. The customer can operate his account over the mobile phone.
PHONE BANKING The customer can obtain information about his account quickly, but however deposit and withdrawal cannot be made over the phone. Otherwise the information about his account can obtain.
R E A L T I M E G RO S S SETTLEMENT It is the system of funds transfer from one to another. The transactions are settled one to one without bunching with any other transactions .Once processed the payments are final and irrevocable. . Minimum amount of remittance is Rs.2 lakhs and no upper ceiling is there.
NA T I O NA L E L E C T RO N I C FUNDS TRANSFER It is a system of funds transfer. Its simple, secure, safe, fastest and cost effective pay to transfer of funds. To use this facility they furnish INDIAN FINANCIAL SYSTEM CODE[IFSC], of the beneficiary and also branch name, full account number of the beneficiary. It is chargeable.
MONEYGRAM MoneyGram is a new internet based remittance product. It is cashless money transfer. These facilities available to NRIs to remit money to India.
XPRESS MONEY X-Press money offered in arrangement with M/s UAE exchange financial service limited for remitting money to India. Money can be remitted from 180 countries across the globe.
M I N I S T RY O F C O M PA N Y A F FA I R S This facilities is provided by some banks only. MCA Payments can be done via credit card, internet banking and physical challan currently.