SlideShare a Scribd company logo
1 of 11
DEVTECH FINANCE
BANKING SYSTEM MODULE
BANKING SYSTEM,
ITS FUNCTIONS
AND TYPES
INTRODUCTION TO BANK
• The term ‘bank’ is derived from the French word ‘Banco’ which
means a Bench or Money exchange table.
• A bank is a financial institution that provides banking and other
financial services to their customers such as accepting deposits,
lending loans, money transfer and selling third party products like
insurance, mutual fund and portfolio management.
• When banks accept deposits its liabilities increase as it has to pay
interest to the customer but when it provides loans/ advances its
assets increases as it earns interest.
• As financial intermediaries, banks stand between depositors who
supply capital and borrowers who demand capital.
FUNCTIONS OF BANK
FUNCTIONS
OF BANK
PRIMARY
FUNCTION
ACCEPTING
DEPOSIT
LENDING
LOAN
SECONDARY
FUNCTION
REMITTANCE
PRODUCT
FINANCIAL
SERVICES
PRIMARY FUNCTIONS OF BANK
• The functions of commercial banks can be broadly categorized into :-
a) Primary functions b) Secondary functions
• ACCEPTING DEPOSIT - The primary function of commercial banks is to
accept money from the people in the form of deposits which are usually
repayable on demand or after the expiry of a fixed period. The deposits may
be of various types such as savings deposits, current deposits, fixed deposits
and recurring deposits. For these deposits, the banks pay a rate of interest to
the depositors.
• LENDING LOANS - The second primary function of bank is to lend loans and
advances to the corporate sector and households. Normally, the rate of
interest levied on these loans and advances is higher than what it pays on
deposits. The difference in the interest rates is called Interest Spread, which
contributes to bank’s profitability.
SECONDARY FUNCTIONS OF BANK
• REMITTANCE PRODUCTS – These products enabled fund transfer
from one bank account to another across the globe. It has been
evolved over time from physical movement of remittance instruments
like cheques, demand drafts and bank orders to electronic fund
transfer services like NEFT, RTGS, IMPS.
• FINANCIAL SERVICES – Distribution of third party products like
mutual funds, insurance, demat & trading services, portfolio
management services has emerged as a key driver of revenue in form
of commission and fee for the banks in modern times. This concept of
selling products other than banking products is called “Para Banking”.
TYPES OF BANK
TYPES OF
BANK
ON THE BASIS
OF
OWNERSHIP
PUBLIC BANK
PRIVATE
BANK
FOREIGN
BANK
COOPERATIVE
BANK
ON THE BASIS
OF FUNCTION
COMMERCIAL
BANK
PAYMENT
BANK SMALL
FINANCE
BANK
INVESTMENT
BANK
EXCHANGE
BANK
TYPES OF BANK – OWNERSHIP BASIS
• PUBLIC SECTOR BANKS – Public Sector Banks are those banks in
which majority stake (i.e., more than 50% of the shares) is held by the
government of the country. Some examples of public sector banks in
India include State Bank of India, Punjab National Bank, Canara Bank,
Union Bank of India, Allahabad Bank and so on.
• PRIVATE SECTOR BANKS – Private Sector Banks are those banks
which are owned by group of private shareholders. They elect board of
directors which manages the affairs of the banks. Some examples of
private banks in India include HDFC Bank, Kotak Mahindra Bank,
ICICI Bank, Federal Bank, Axis Bank and so on.
TYPES OF BANK – OWNERSHIP BASIS
• FOREIGN BANKS – A foreign bank is one that has its headquarters in a
foreign country but operates in India as a private entity. These banks are under
the obligation to follow the regulations of its home country as well as the
country in which they are operating. Some examples of foreign banks in Indian
include ABM Amro bank, Standard Chartered Bank, JP Morgan Chase Bank
and so on.
• COOPERATIVE BANKS – Co-operative banks are registered under the
Cooperative Societies Act, 1912 and they are run by an elected managing
committee. These banks work on no-profit basis and mainly serve
entrepreneurs, small businesses, and self-employment in urban areas. In rural
areas, they mainly finance agriculture-based activities like farming and
livestock. Some examples of cooperative banks in India include Central
Cooperative Banks, State Cooperative Banks.
TYPES OF BANK – FUNCTION BASIS
• PAYMENT BANKS – These banks are a relatively new model of bank in the
Indian Banking industry. It do not provide loans/ advances and is allowed to
accept a restricted deposit. The amount is currently limited to Rs.1 Lakh per
customer. They also offer services like ATM cards, debit cards, net-banking
and mobile-banking.
• COMMERCIAL BANKS – These banks are regulated under the Banking
Regulation Act, 1949 and their business model is designed to make profit.
Their primary function is to accept deposits and grant loans to the general
public, corporate and government and carry many para-banking activities.
• FOREIGN EXCHANGE BANKS – These banks are incorporated outside the
country but carry out business in India. They provide foreign exchange subject
to the rules and regulations of the country in which they are operating. They
also provide finance to exporters and letter of credit/guarantee to importers.
TYPES OF BANK – FUNCTION BASIS
• INVESTMENT BANKS – These banks are specialized in assisting corporates
to raise finance for activities such as mergers & acquisitions, raising fund
through ipo, underwriting, financial advisory, research etc. Major investment
banks include JP Morgan Chase, Goldman Sachs, Morgan Stanley, Citigroup,
Bank of America.
• SMALL FINANCE BANKS – These banks function with primary objective of
providing supply of credit to small business units, farmers, micro and small
industries, unorganized sector. These banks mainly perform basic banking
activities such as acceptance of deposit, cheque clearance and providing loan
to unserved section of society. Some of the prominent small finance banks in
India are Ujjivan Small Finance Bank, A.U. Small Finance Bank, Equitas Small
Finance Bank, Janalakshmi Small Finance Bank.
THANK YOU FOR WATCHING
DEVTECH
FINANCE

More Related Content

What's hot

What's hot (20)

Commercial bank and its functions
Commercial bank and its functionsCommercial bank and its functions
Commercial bank and its functions
 
Commercial banking
Commercial bankingCommercial banking
Commercial banking
 
Bank operations
Bank operationsBank operations
Bank operations
 
Functions of commercial banks
Functions of commercial banksFunctions of commercial banks
Functions of commercial banks
 
commercial bank
commercial bankcommercial bank
commercial bank
 
modern bankin system in india
modern bankin system in indiamodern bankin system in india
modern bankin system in india
 
Functions of a commercial bank
Functions of a commercial bankFunctions of a commercial bank
Functions of a commercial bank
 
Commercial bank
Commercial bank Commercial bank
Commercial bank
 
Commercial bank
Commercial bankCommercial bank
Commercial bank
 
ROLE OF COMMERCIAL BANKS
ROLE OF COMMERCIAL BANKSROLE OF COMMERCIAL BANKS
ROLE OF COMMERCIAL BANKS
 
Role of Commercial Banks in India
Role of Commercial Banks in IndiaRole of Commercial Banks in India
Role of Commercial Banks in India
 
Commercial banks in india
Commercial banks in indiaCommercial banks in india
Commercial banks in india
 
Commercial banking
Commercial bankingCommercial banking
Commercial banking
 
Commercial Banks
Commercial BanksCommercial Banks
Commercial Banks
 
Unit banking
Unit bankingUnit banking
Unit banking
 
Importance Of Banks In An Economy
Importance Of Banks In An EconomyImportance Of Banks In An Economy
Importance Of Banks In An Economy
 
Commercial banks in india
Commercial banks in indiaCommercial banks in india
Commercial banks in india
 
About banking
About bankingAbout banking
About banking
 
Functions of commercial banks
Functions of commercial banksFunctions of commercial banks
Functions of commercial banks
 
Bank presentation new
Bank presentation newBank presentation new
Bank presentation new
 

Similar to Indian Banking System

Similar to Indian Banking System (20)

Commercial banking
Commercial bankingCommercial banking
Commercial banking
 
ppt_bifs.pdf
ppt_bifs.pdfppt_bifs.pdf
ppt_bifs.pdf
 
Business studies project
Business studies projectBusiness studies project
Business studies project
 
lecture two.pptx
lecture two.pptxlecture two.pptx
lecture two.pptx
 
Retail banking
Retail banking Retail banking
Retail banking
 
Management of Financial Services
Management of Financial Services Management of Financial Services
Management of Financial Services
 
Banking
BankingBanking
Banking
 
banking-171026063821.pdf
banking-171026063821.pdfbanking-171026063821.pdf
banking-171026063821.pdf
 
banking-171026063821.pptx
banking-171026063821.pptxbanking-171026063821.pptx
banking-171026063821.pptx
 
GENERAL BANKING.pptx
GENERAL BANKING.pptxGENERAL BANKING.pptx
GENERAL BANKING.pptx
 
Bank and Banking System
Bank and Banking SystemBank and Banking System
Bank and Banking System
 
Banking services in india
Banking services in indiaBanking services in india
Banking services in india
 
Bc77 core banking
Bc77 core bankingBc77 core banking
Bc77 core banking
 
Types of banks in pakistan
Types of banks in pakistanTypes of banks in pakistan
Types of banks in pakistan
 
BANKING SECTOR IN INDIA
BANKING SECTOR IN INDIABANKING SECTOR IN INDIA
BANKING SECTOR IN INDIA
 
Overview of financial system and banking system in BD
Overview of financial system and banking system in BDOverview of financial system and banking system in BD
Overview of financial system and banking system in BD
 
Bank
Bank Bank
Bank
 
Banking Functions and Types of Banks in India
Banking Functions and Types of Banks in IndiaBanking Functions and Types of Banks in India
Banking Functions and Types of Banks in India
 
Eco report
Eco reportEco report
Eco report
 
FAB I.pdf
FAB I.pdfFAB I.pdf
FAB I.pdf
 

More from DevTech Finance (20)

Bitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrencyBitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrency
 
Cash Management
Cash ManagementCash Management
Cash Management
 
Portfolio Management
Portfolio ManagementPortfolio Management
Portfolio Management
 
No Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest LoanNo Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest Loan
 
Health Insurance
Health InsuranceHealth Insurance
Health Insurance
 
Face Value, Book Value & Market Value
Face Value, Book Value & Market ValueFace Value, Book Value & Market Value
Face Value, Book Value & Market Value
 
Loan Moratorium Period.
Loan Moratorium Period.Loan Moratorium Period.
Loan Moratorium Period.
 
Hire Purchase
Hire PurchaseHire Purchase
Hire Purchase
 
Infrastructure Financing
Infrastructure FinancingInfrastructure Financing
Infrastructure Financing
 
Recovery Management In Banking
Recovery Management In BankingRecovery Management In Banking
Recovery Management In Banking
 
Board of Directors
Board of DirectorsBoard of Directors
Board of Directors
 
Inventory Management
Inventory ManagementInventory Management
Inventory Management
 
Money Market
Money MarketMoney Market
Money Market
 
Consortium Finance
Consortium FinanceConsortium Finance
Consortium Finance
 
CRM Models
CRM ModelsCRM Models
CRM Models
 
Accounting Concepts & Conventions
Accounting Concepts & ConventionsAccounting Concepts & Conventions
Accounting Concepts & Conventions
 
NBFC
NBFCNBFC
NBFC
 
NPCI
NPCINPCI
NPCI
 
Credit Monitoring
Credit MonitoringCredit Monitoring
Credit Monitoring
 
Stewardship theory
Stewardship theoryStewardship theory
Stewardship theory
 

Recently uploaded

male presentation...pdf.................
male presentation...pdf.................male presentation...pdf.................
male presentation...pdf.................MirzaAbrarBaig5
 
An overview of the various scriptures in Hinduism
An overview of the various scriptures in HinduismAn overview of the various scriptures in Hinduism
An overview of the various scriptures in HinduismDabee Kamal
 
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptx
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptxMichaelis Menten Equation and Estimation Of Vmax and Tmax.pptx
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptxRugvedSathawane
 
AIM of Education-Teachers Training-2024.ppt
AIM of Education-Teachers Training-2024.pptAIM of Education-Teachers Training-2024.ppt
AIM of Education-Teachers Training-2024.pptNishitharanjan Rout
 
SURVEY I created for uni project research
SURVEY I created for uni project researchSURVEY I created for uni project research
SURVEY I created for uni project researchCaitlinCummins3
 
Pharmaceutical Biotechnology VI semester.pdf
Pharmaceutical Biotechnology VI semester.pdfPharmaceutical Biotechnology VI semester.pdf
Pharmaceutical Biotechnology VI semester.pdfBALASUNDARESAN M
 
Rich Dad Poor Dad ( PDFDrive.com )--.pdf
Rich Dad Poor Dad ( PDFDrive.com )--.pdfRich Dad Poor Dad ( PDFDrive.com )--.pdf
Rich Dad Poor Dad ( PDFDrive.com )--.pdfJerry Chew
 
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdf
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdfFICTIONAL SALESMAN/SALESMAN SNSW 2024.pdf
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdfPondicherry University
 
Details on CBSE Compartment Exam.pptx1111
Details on CBSE Compartment Exam.pptx1111Details on CBSE Compartment Exam.pptx1111
Details on CBSE Compartment Exam.pptx1111GangaMaiya1
 
8 Tips for Effective Working Capital Management
8 Tips for Effective Working Capital Management8 Tips for Effective Working Capital Management
8 Tips for Effective Working Capital ManagementMBA Assignment Experts
 
e-Sealing at EADTU by Kamakshi Rajagopal
e-Sealing at EADTU by Kamakshi Rajagopale-Sealing at EADTU by Kamakshi Rajagopal
e-Sealing at EADTU by Kamakshi RajagopalEADTU
 
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...Nguyen Thanh Tu Collection
 
What is 3 Way Matching Process in Odoo 17.pptx
What is 3 Way Matching Process in Odoo 17.pptxWhat is 3 Way Matching Process in Odoo 17.pptx
What is 3 Way Matching Process in Odoo 17.pptxCeline George
 
UChicago CMSC 23320 - The Best Commit Messages of 2024
UChicago CMSC 23320 - The Best Commit Messages of 2024UChicago CMSC 23320 - The Best Commit Messages of 2024
UChicago CMSC 23320 - The Best Commit Messages of 2024Borja Sotomayor
 
OSCM Unit 2_Operations Processes & Systems
OSCM Unit 2_Operations Processes & SystemsOSCM Unit 2_Operations Processes & Systems
OSCM Unit 2_Operations Processes & SystemsSandeep D Chaudhary
 
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...nhezmainit1
 
How to Send Pro Forma Invoice to Your Customers in Odoo 17
How to Send Pro Forma Invoice to Your Customers in Odoo 17How to Send Pro Forma Invoice to Your Customers in Odoo 17
How to Send Pro Forma Invoice to Your Customers in Odoo 17Celine George
 
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading Room
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading RoomSternal Fractures & Dislocations - EMGuidewire Radiology Reading Room
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading RoomSean M. Fox
 

Recently uploaded (20)

male presentation...pdf.................
male presentation...pdf.................male presentation...pdf.................
male presentation...pdf.................
 
An overview of the various scriptures in Hinduism
An overview of the various scriptures in HinduismAn overview of the various scriptures in Hinduism
An overview of the various scriptures in Hinduism
 
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptx
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptxMichaelis Menten Equation and Estimation Of Vmax and Tmax.pptx
Michaelis Menten Equation and Estimation Of Vmax and Tmax.pptx
 
AIM of Education-Teachers Training-2024.ppt
AIM of Education-Teachers Training-2024.pptAIM of Education-Teachers Training-2024.ppt
AIM of Education-Teachers Training-2024.ppt
 
SURVEY I created for uni project research
SURVEY I created for uni project researchSURVEY I created for uni project research
SURVEY I created for uni project research
 
Pharmaceutical Biotechnology VI semester.pdf
Pharmaceutical Biotechnology VI semester.pdfPharmaceutical Biotechnology VI semester.pdf
Pharmaceutical Biotechnology VI semester.pdf
 
Rich Dad Poor Dad ( PDFDrive.com )--.pdf
Rich Dad Poor Dad ( PDFDrive.com )--.pdfRich Dad Poor Dad ( PDFDrive.com )--.pdf
Rich Dad Poor Dad ( PDFDrive.com )--.pdf
 
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdf
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdfFICTIONAL SALESMAN/SALESMAN SNSW 2024.pdf
FICTIONAL SALESMAN/SALESMAN SNSW 2024.pdf
 
Details on CBSE Compartment Exam.pptx1111
Details on CBSE Compartment Exam.pptx1111Details on CBSE Compartment Exam.pptx1111
Details on CBSE Compartment Exam.pptx1111
 
8 Tips for Effective Working Capital Management
8 Tips for Effective Working Capital Management8 Tips for Effective Working Capital Management
8 Tips for Effective Working Capital Management
 
e-Sealing at EADTU by Kamakshi Rajagopal
e-Sealing at EADTU by Kamakshi Rajagopale-Sealing at EADTU by Kamakshi Rajagopal
e-Sealing at EADTU by Kamakshi Rajagopal
 
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...
80 ĐỀ THI THỬ TUYỂN SINH TIẾNG ANH VÀO 10 SỞ GD – ĐT THÀNH PHỐ HỒ CHÍ MINH NĂ...
 
What is 3 Way Matching Process in Odoo 17.pptx
What is 3 Way Matching Process in Odoo 17.pptxWhat is 3 Way Matching Process in Odoo 17.pptx
What is 3 Way Matching Process in Odoo 17.pptx
 
UChicago CMSC 23320 - The Best Commit Messages of 2024
UChicago CMSC 23320 - The Best Commit Messages of 2024UChicago CMSC 23320 - The Best Commit Messages of 2024
UChicago CMSC 23320 - The Best Commit Messages of 2024
 
OSCM Unit 2_Operations Processes & Systems
OSCM Unit 2_Operations Processes & SystemsOSCM Unit 2_Operations Processes & Systems
OSCM Unit 2_Operations Processes & Systems
 
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...
PS-Policies-on-Enrolment-Transfer-of-Docs-Checking-of-School-Forms-and-SF10-a...
 
How to Send Pro Forma Invoice to Your Customers in Odoo 17
How to Send Pro Forma Invoice to Your Customers in Odoo 17How to Send Pro Forma Invoice to Your Customers in Odoo 17
How to Send Pro Forma Invoice to Your Customers in Odoo 17
 
Mattingly "AI & Prompt Design: Named Entity Recognition"
Mattingly "AI & Prompt Design: Named Entity Recognition"Mattingly "AI & Prompt Design: Named Entity Recognition"
Mattingly "AI & Prompt Design: Named Entity Recognition"
 
VAMOS CUIDAR DO NOSSO PLANETA! .
VAMOS CUIDAR DO NOSSO PLANETA!                    .VAMOS CUIDAR DO NOSSO PLANETA!                    .
VAMOS CUIDAR DO NOSSO PLANETA! .
 
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading Room
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading RoomSternal Fractures & Dislocations - EMGuidewire Radiology Reading Room
Sternal Fractures & Dislocations - EMGuidewire Radiology Reading Room
 

Indian Banking System

  • 1. DEVTECH FINANCE BANKING SYSTEM MODULE BANKING SYSTEM, ITS FUNCTIONS AND TYPES
  • 2. INTRODUCTION TO BANK • The term ‘bank’ is derived from the French word ‘Banco’ which means a Bench or Money exchange table. • A bank is a financial institution that provides banking and other financial services to their customers such as accepting deposits, lending loans, money transfer and selling third party products like insurance, mutual fund and portfolio management. • When banks accept deposits its liabilities increase as it has to pay interest to the customer but when it provides loans/ advances its assets increases as it earns interest. • As financial intermediaries, banks stand between depositors who supply capital and borrowers who demand capital.
  • 3. FUNCTIONS OF BANK FUNCTIONS OF BANK PRIMARY FUNCTION ACCEPTING DEPOSIT LENDING LOAN SECONDARY FUNCTION REMITTANCE PRODUCT FINANCIAL SERVICES
  • 4. PRIMARY FUNCTIONS OF BANK • The functions of commercial banks can be broadly categorized into :- a) Primary functions b) Secondary functions • ACCEPTING DEPOSIT - The primary function of commercial banks is to accept money from the people in the form of deposits which are usually repayable on demand or after the expiry of a fixed period. The deposits may be of various types such as savings deposits, current deposits, fixed deposits and recurring deposits. For these deposits, the banks pay a rate of interest to the depositors. • LENDING LOANS - The second primary function of bank is to lend loans and advances to the corporate sector and households. Normally, the rate of interest levied on these loans and advances is higher than what it pays on deposits. The difference in the interest rates is called Interest Spread, which contributes to bank’s profitability.
  • 5. SECONDARY FUNCTIONS OF BANK • REMITTANCE PRODUCTS – These products enabled fund transfer from one bank account to another across the globe. It has been evolved over time from physical movement of remittance instruments like cheques, demand drafts and bank orders to electronic fund transfer services like NEFT, RTGS, IMPS. • FINANCIAL SERVICES – Distribution of third party products like mutual funds, insurance, demat & trading services, portfolio management services has emerged as a key driver of revenue in form of commission and fee for the banks in modern times. This concept of selling products other than banking products is called “Para Banking”.
  • 6. TYPES OF BANK TYPES OF BANK ON THE BASIS OF OWNERSHIP PUBLIC BANK PRIVATE BANK FOREIGN BANK COOPERATIVE BANK ON THE BASIS OF FUNCTION COMMERCIAL BANK PAYMENT BANK SMALL FINANCE BANK INVESTMENT BANK EXCHANGE BANK
  • 7. TYPES OF BANK – OWNERSHIP BASIS • PUBLIC SECTOR BANKS – Public Sector Banks are those banks in which majority stake (i.e., more than 50% of the shares) is held by the government of the country. Some examples of public sector banks in India include State Bank of India, Punjab National Bank, Canara Bank, Union Bank of India, Allahabad Bank and so on. • PRIVATE SECTOR BANKS – Private Sector Banks are those banks which are owned by group of private shareholders. They elect board of directors which manages the affairs of the banks. Some examples of private banks in India include HDFC Bank, Kotak Mahindra Bank, ICICI Bank, Federal Bank, Axis Bank and so on.
  • 8. TYPES OF BANK – OWNERSHIP BASIS • FOREIGN BANKS – A foreign bank is one that has its headquarters in a foreign country but operates in India as a private entity. These banks are under the obligation to follow the regulations of its home country as well as the country in which they are operating. Some examples of foreign banks in Indian include ABM Amro bank, Standard Chartered Bank, JP Morgan Chase Bank and so on. • COOPERATIVE BANKS – Co-operative banks are registered under the Cooperative Societies Act, 1912 and they are run by an elected managing committee. These banks work on no-profit basis and mainly serve entrepreneurs, small businesses, and self-employment in urban areas. In rural areas, they mainly finance agriculture-based activities like farming and livestock. Some examples of cooperative banks in India include Central Cooperative Banks, State Cooperative Banks.
  • 9. TYPES OF BANK – FUNCTION BASIS • PAYMENT BANKS – These banks are a relatively new model of bank in the Indian Banking industry. It do not provide loans/ advances and is allowed to accept a restricted deposit. The amount is currently limited to Rs.1 Lakh per customer. They also offer services like ATM cards, debit cards, net-banking and mobile-banking. • COMMERCIAL BANKS – These banks are regulated under the Banking Regulation Act, 1949 and their business model is designed to make profit. Their primary function is to accept deposits and grant loans to the general public, corporate and government and carry many para-banking activities. • FOREIGN EXCHANGE BANKS – These banks are incorporated outside the country but carry out business in India. They provide foreign exchange subject to the rules and regulations of the country in which they are operating. They also provide finance to exporters and letter of credit/guarantee to importers.
  • 10. TYPES OF BANK – FUNCTION BASIS • INVESTMENT BANKS – These banks are specialized in assisting corporates to raise finance for activities such as mergers & acquisitions, raising fund through ipo, underwriting, financial advisory, research etc. Major investment banks include JP Morgan Chase, Goldman Sachs, Morgan Stanley, Citigroup, Bank of America. • SMALL FINANCE BANKS – These banks function with primary objective of providing supply of credit to small business units, farmers, micro and small industries, unorganized sector. These banks mainly perform basic banking activities such as acceptance of deposit, cheque clearance and providing loan to unserved section of society. Some of the prominent small finance banks in India are Ujjivan Small Finance Bank, A.U. Small Finance Bank, Equitas Small Finance Bank, Janalakshmi Small Finance Bank.
  • 11. THANK YOU FOR WATCHING DEVTECH FINANCE