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Saturday, 10 September 2016

Categories of banks in india

Categorisation of banks according to structure of banking system in India

In India Reserve Bank of India is the apex authority of all banks.All banks comes under reserve bank of India.
 

Scheduled and Non-Scheduled banks

A bank is said to be scheduled bank when it has paid up capital and reserves as per the prescription of RBI and included in the second schedule of RBI Act 1934.Non-scheduled banks are those commercial banks, which are not included in the second schedule of RBI Act 1934

Commercial Banks

Commercial bank is an institution that accept deposit from public, lend loans and advances to general publics and business men inorder to make profit.They cater to the financial requirement of industries and various sectors like agriculture,rural development, etc. Commercial banks includes public sector,private sector,foreign banks and regional rural banks.

Public sector Banks

It includes SBI,7 SBI associate banks and 19 nationalized banks.The public sector banks covers 90% of total banking business in India.

Private sector banks

Private sector banks are those whose equity is held by private share holders.Major private sector in India are ICICI,HDFC,AXIS,South Indian Bank,Yes Bank etc.

Foreign Banks

Those banks,which have their head office abroad.CITI Bank,HSBC,Stantard Chartered Bank etc. are examples of foreign banks in India.

Regional Rural Banks

These are state sponsored regional rural oriented banks.They provide credit for agriculture and rural development.Their borrowers include small and marginal farmers,agricultural labourers,artisans etc.NABARD hold the apex position in the agriculture and rural development.

Co-operative Banks

Co-operative banks was set up by passing Co-operatice Credit  Societies Act in 1904.They are managed and organized based on the principal of co-operation mutual help. The main objective of these banks is rural credit.
Three tier structure exist in Co-operative bank structure.
  1. State co-operative bank at the apex level
  2. Central co-operative bank at district level
  3. Primary co-operative at the base or local level

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