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 Scheduled commercial banks are those included in the
second schedule of the Reserve Bank of India Act, 1934.
 For this, they have to satisfy three conditions:
 It must have paid-up capital and reserves of an
aggregate value of atleast Rs. 5 lakhs.
 It is carrying on the business of banking in India.
 It must be a corporation or cooperative society and
not a partnership or sole proprietorship firm.
INDIAN BANKS
 Registered or incorporated in
India.
 They have their headquarter
in India and can have
branches all over India.
 They can also operate in
foreign countries.
FOREIGN BANKS
 Registered or incorporated in
their home country, not in
India.
 They have their office and/or
branches in India.
 They play an important role in
shaping the attitude and
policies of foreign govt.,
companies and their clients
towards India.
 Public sector banks are
banks in which the
government has a major
holding.
 At least 51% ownership
is vested with the
government.
 The shares of these banks
are listed on stock
exchanges.
 Government of India
entered in commercial
banking when it took over
Imperial Bank of India
and converted into State
Bank of India on 1 July
1955.
 It was first one to make
public issue in 1993-94
after which the share
holding of RBI has come
down to 68.93%.
State Bank Group
 State Bank of Hyderabad
 State Bank of Patiala
 State Bank of Travancore
 State Bank of Bikaner &
Jaipur
 State Bank of Maysore
 State Bank of Saurashtra
 State Bank of Indore
 In 1969, 14 banks with deposit base
of Rs. 50 Crores or more were
nationalized. In 1980,, 6 more
banks were nationalized.
 This step brought more than 90%
of commercial banking in the
public sector.
 The main function of nationalised
bank is provide finance for the
housing projects, health facilities
and increase the chance to
providinig the products and
services to the people of rural
areas.
 Andhra Bank
 Punjab National Bank
 Indian Overseas Bank
 IDBI
 Allahabad Bank
 Syndicate Bank
 UCO Bank
 Dena Bank
 All those banks in which
majority of stake are held by
private individuals
 The banks, which came in
operation after 1991, with the
introduction of economic
reforms and financial sector
reforms are called "new
private-sector banks“
 New banks are strategic in
their thinking and operations.
 The banks which are not included in the 2nd
schedule of RBI Act,
1934.
 These also have to maintain statutory cash reserve but not with
RBI.
 Their banking activities are limited, e.g., they cannot deal in
foreign exchange.
 The share of these banks are almost nil.
 They were set up on the
recommendation of Narasimham
Committee in 1975.
 The objective was to provide credit
and other facilities to small and
marginal farmers, agricultural
labours and artisans.
 RRBs are working in all states
except GOA and Sikkim.
 They are governed by Regional
Rural Bank act, 1976
 50% capital is provided by central
govt., 15% by state govt., 35% by
sponsoring public sector bank.
Features of RRB:
 The area of RRB is limited to only a
region, comprising of some district
of a state
 These banks grant loan only to the
rural agriculture sector and small
artisans.
 The lending rates would be some
what lower than the commercial
banks.
 These are intended to eliminate
money lenders.
 These banks are to supplement the
effort of cooperative banks.
 Cooperative banking is a
small scale banking carried
on a no profit no loss basis
for mutual cooperation and
help.
 Engaged in financing rural
and agricultural development.
 They are established under
the Cooperative Credit
Societies Act of 1904.
Feature of cooperative banks:
 Government sponsored, supported
and subsidized financial agencies in
India.
 Work on the principle of
cooperation, self help and mutual
help.
 They function on “no profit no loss”
basis.
 Perform limited banking functions.
 Some of them are scheduled banks
but most are non- scheduled banks.
 Cooperative banks are financial
intermediaries only because a
significant amount of their
borrowings is from the RBI,
NABARD, central and state
government and cooperative apex
institutions.
Characteristics
 Customer owned
Entity
 Democratic Control
 Profit Allocation
Typesofbanks
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Typesofbanks

  • 1.
  • 2.
  • 3.  Scheduled commercial banks are those included in the second schedule of the Reserve Bank of India Act, 1934.  For this, they have to satisfy three conditions:  It must have paid-up capital and reserves of an aggregate value of atleast Rs. 5 lakhs.  It is carrying on the business of banking in India.  It must be a corporation or cooperative society and not a partnership or sole proprietorship firm.
  • 4. INDIAN BANKS  Registered or incorporated in India.  They have their headquarter in India and can have branches all over India.  They can also operate in foreign countries. FOREIGN BANKS  Registered or incorporated in their home country, not in India.  They have their office and/or branches in India.  They play an important role in shaping the attitude and policies of foreign govt., companies and their clients towards India.
  • 5.  Public sector banks are banks in which the government has a major holding.  At least 51% ownership is vested with the government.  The shares of these banks are listed on stock exchanges.
  • 6.  Government of India entered in commercial banking when it took over Imperial Bank of India and converted into State Bank of India on 1 July 1955.  It was first one to make public issue in 1993-94 after which the share holding of RBI has come down to 68.93%. State Bank Group  State Bank of Hyderabad  State Bank of Patiala  State Bank of Travancore  State Bank of Bikaner & Jaipur  State Bank of Maysore  State Bank of Saurashtra  State Bank of Indore
  • 7.  In 1969, 14 banks with deposit base of Rs. 50 Crores or more were nationalized. In 1980,, 6 more banks were nationalized.  This step brought more than 90% of commercial banking in the public sector.  The main function of nationalised bank is provide finance for the housing projects, health facilities and increase the chance to providinig the products and services to the people of rural areas.  Andhra Bank  Punjab National Bank  Indian Overseas Bank  IDBI  Allahabad Bank  Syndicate Bank  UCO Bank  Dena Bank
  • 8.  All those banks in which majority of stake are held by private individuals  The banks, which came in operation after 1991, with the introduction of economic reforms and financial sector reforms are called "new private-sector banks“  New banks are strategic in their thinking and operations.
  • 9.  The banks which are not included in the 2nd schedule of RBI Act, 1934.  These also have to maintain statutory cash reserve but not with RBI.  Their banking activities are limited, e.g., they cannot deal in foreign exchange.  The share of these banks are almost nil.
  • 10.  They were set up on the recommendation of Narasimham Committee in 1975.  The objective was to provide credit and other facilities to small and marginal farmers, agricultural labours and artisans.  RRBs are working in all states except GOA and Sikkim.  They are governed by Regional Rural Bank act, 1976  50% capital is provided by central govt., 15% by state govt., 35% by sponsoring public sector bank. Features of RRB:  The area of RRB is limited to only a region, comprising of some district of a state  These banks grant loan only to the rural agriculture sector and small artisans.  The lending rates would be some what lower than the commercial banks.  These are intended to eliminate money lenders.  These banks are to supplement the effort of cooperative banks.
  • 11.  Cooperative banking is a small scale banking carried on a no profit no loss basis for mutual cooperation and help.  Engaged in financing rural and agricultural development.  They are established under the Cooperative Credit Societies Act of 1904. Feature of cooperative banks:  Government sponsored, supported and subsidized financial agencies in India.  Work on the principle of cooperation, self help and mutual help.  They function on “no profit no loss” basis.  Perform limited banking functions.  Some of them are scheduled banks but most are non- scheduled banks.  Cooperative banks are financial intermediaries only because a significant amount of their borrowings is from the RBI, NABARD, central and state government and cooperative apex institutions.
  • 12. Characteristics  Customer owned Entity  Democratic Control  Profit Allocation