THIS IS A FILE FOR BASIC KNOWLADGE FOR BANKING

1. MAITRI VIDYA NIKETAN
Risali, Bhilai
Presentation on Banking
By: Pranshu Sahu
Xll/C

2. Banking
Banking is defined as the business activity of
accepting and safeguarding money owned by other
individuals and entities, and then lending out this
money in order to conduct economic activities such
as making profit or simply covering operating
expenses. Investment banks gear their services
toward corporate clients.

3. Why is Banking Important?
Because those who are unbanked or underbanked
are hindering their financial lives from enjoying
services that lead to financial well-being. Many
must resort to services outside the banking system
to cash checks or borrow loans and incur higher
transaction fees and interest unnecessarily. Here
are some of the reasons why banking tops the list of
pillars required in financial literacy.

4. Thinks to keep in mind while banking
• Safeguard your cash
• Manage your finances – record keeping and budgeting
• Receive your paycheck quickly using direct deposit
• Facilitate financial transactions
• Insure your liquid assets
• Use debit and credit card services
• Earn interest
• Borrow loans
• Invest your money

5. Banking system in india

6. Structure of Banking in India
The existing banking structure in India evolved over several
decades, is elaborate and has been serving the credit and banking
services needs of the economy. There are multiple layers in
today’s banking structure to cater to the specific and varied
requirements of different customers and borrowers. The structure
of banking in India played a major role in the mobilization of
savings and promoting economic development. In the post-
financial sector reforms (1991) phase, the performance and
strength of the banking structure improved perceptibly. Financial
soundness of the Indian commercial banking system compares
favorably with most of the advanced and emerging countries.

7. Commercial banks
A commercial bank is a type of bank that provides services
such as accepting deposits, making business loans, and
offering basic investment products that are operated as a
business for profit.
It can also refer to a bank, or a division of a large bank,
which deals with corporations or large/middle-sized business
to differentiate it from a retail bank and an investment
bank. Commercial banks include private sector banks and
public sector banks

8. Functions of commercial bank
(a)Accepting Deposits: The banks borrow in the form of deposits. This
function is important because banks mainly depend on the funds deposited
with them by the public.
(b) Advancing Loans: Another function of the bank is to give loans to others.
If the bank does not lend the deposited money to others, Banks give loans to
businessmen and firms usually for short periods only. This is so because the
bank must keep itself ready to meet the demands of the people who have
deposited money for short period only. In advancing loans, the bank has to
shoulder a heavy responsibility.
(c) Discounting Bills of Exchange or Hundies: A very important function of
a modern bank is to discount bills or hundies of businessmen. It is like this, a
businessman buys goods and is granted credit, say, for a month. The seller of
the goods draws a bill of exchange which the purchaser is asked to sign.

9. (d) Transfer of Money: Banks transfer money from one place to another
for their customers. Banks remit the funds of the people by means of a
bank draft or a cheque. This is a cheap as well as safe method of
transferring money from one place to another.
(e) Miscellaneous Functions: A bank now-a-days serves its customers in
various other ways. It has lockers or ‘safe deposit vaults’. They are
meant to keep the valuables of customers in safe custody. Further, a
bank collects interest on behalf of its customers as well as pays dividends
on behalf of joint-stock companies. It purchases and sells stocks and
shares of companies for its clients. It pays insurance premium on behalf
of their customers from their deposits

10. Cooperative bank
Co-operative banks are financial entities established on a co-
operative basis and belonging to their members. This means
that the customers of a co-operative bank are also its
owners. These banks provide a wide range of regular banking
and financial services.
It is also known as co-operative, co-op, or coop

11. Functions of co-operative Bank
1. They function with the rule of “one member, one vote”
and function on “no profit, no loss” basis
2. It performs all the main banking functions of deposit
mobilization, the supply of credit and provision of
remittance facilities
3. It provides financial assistance to the people with small
means to protect them from the debt trap of the
moneylenders
4. It is engaged in tasks of production, processing,
marketing, distribution, servicing and banking in India
5. It supervises and guides affiliated societies

12. 6. Mobilization of funds from their members
7. Advance loans to the members
8. Rural financing for farming, cattle, milk, hatchery,
personal finance, etc.
9.Urban financing for Self – employment, Industries Small
scale units, Home finance, Consumer finance, Personal
finance

13. Services and products provide by banks
1. Advancing of Loans.
2. Overdraft.
3. Discounting of Bills of Exchange.
4. Check/Cheque Payment.
5. Collection and Payment Of Credit Instruments.
6. Foreign Currency Exchange.
7. Consultancy.8. Bank Guarantee.
9. Remittance of Funds.

14. 10. Credit cards.
11. ATMs Services.
12. Debit cards.
13. Home banking.
14. Online banking.
15. Mobile Banking.
16. Accepting Deposit.
17. Priority banking.
18. Private banking.

15. Banking services
Basic banking services include a payment account
with basic features and an instrument for using the
account (e.g. a debit card and online banking ID),
the possibility to withdraw cash, the execution of
payment transactions and an electronic means of
identification. Basic banking services, on the other
hand, do not include accounts with an overdraft
facility or various kinds of credit cards.

16. First Indian Governor
Chakravarti Rajagopalachari
(26 Jan,1950 to 20 Oct,1773)

17. International banking
International banking is a necessary tool for successful export and
international trade business and activities. It is especially
important when dealing in foreign currencies. There are many
banks offering international banking services, but it is necessary to
choose a bank that is adept in providing the required international
services and products that the business requires. International
banking accounts are especially important to businesses which the
nature of the business is the import and or export of goods.
International banking is offered both onshore and offshore.

18. The Advantages of International Banking
• Tax efficiency
• Convenience and greater flexibility
• Investing
• Easy transfers and lower exchange risk
• Lending and Credit

19. E-Banking
Electronic banking, Use of computers and telecommunications to
enable banking transactions to be done by telephone or computer
rather than through human interaction. Its features include
electronic funds transfer for retail purchases, automatic teller
machines (ATMs), and automatic payroll deposits and bill
payments. Some banks offer home banking, whereby a person with
a personal computer can make transactions, either via a direct
connection or by accessing a Web site. Electronic banking has
vastly reduced the physical transfer of paper money and coinage
from one place to another or even from one person to another.

20. Features and Characteristics of E-Banking
• Faster Transactions.
• Lowers Transaction Cost.
• Provides 24×7 Service.
• Reduces The Chances of Error.
• Develops Loyalty in Customers.
• Removes Geographical Barriers.
• Provides Better Productivity.
• Reduce Frauds in Transactions.