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Indian Banking and Economy

Indian Banking and Economy

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Published by santosh.pw4230
This document gives total information of Indian banking and economy

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This document gives total information of Indian banking and economy

Post your ratings on santosh.pw@rediffmail.com

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Published by: santosh.pw4230 on Jan 02, 2009
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05/23/2013

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INTRODUCTION
A bank is an institution that deals in money and its substitutes and provides other financial services. Banks accept deposits and make loansor make an investment to derive a profit from the difference in theinterest rates paid and charged, respectively.In India the banks are being segregated in different groups. Eachgroup has their own benefits and limitations in operating in India. Eachhas their own dedicated target market. Few of them only work in ruralsector while others in both rural as well as urban. Many even are onlycatering in cities. Some are of Indian origin and some are foreign players.India’s economy has been one of the stars of global economics inrecent years. It has grown by more than 9% for three years running. Theeconomy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles andhandicrafts, and services. Agriculture is a major component of the Indianeconomy, as over 66% of the Indian population earns its livelihood fromthis area. Banking sector is considered as a booming sector in Indianeconomy recently.Banking is a vital system for developing economy for the nation.However, Indian banking system and economy has been facingvarious challenges and problems which have discussed in other parts of  project.
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INDIAN BANKING SYSTEM
Without a sound and effective banking system in India it cannothave a healthy economy. The banking system of India should not only behassle free but it should be able to meet new challenges posed by thetechnology and any other external and internal factors. For the past threedecades India's banking system has several outstanding achievements toits credit. The most striking is its extensive reach. It is no longer confinedto only metropolitans or cosmopolitans in India. In fact, Indian bankingsystem has reached even to the remote corners of the country. This is oneof the main reasons of India's growth process. The government's regular  policy for Indian bank since 1969 has paid rich dividends with thenationalization of 14 major private banks of India. Not long ago, an account holder had to wait for hours at the bank counters for getting a draft or for withdrawing his own money. Today, hehas a choice. Gone are days when the most efficient bank transferredmoney from one branch to other in two days. Now it is simple as instantmessaging or dial a pizza. Money has become the order of the day.The first bank in India, though conservative, was established in1786. From 1786 till today, the journey of Indian Banking System can besegregated into three distinct phases. They are as mentioned below:
Early phase from 1786 to 1969 of Indian Banks
 Nationalization of Indian Banks and up to 1991 prior to Indian banking sector Reforms.
New phase of Indian Banking System with the advent of IndianFinancial & Banking Sector Reforms after 1991.
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After 1991, under the chairmanship of M Narasimham, acommittee was set up by his name which worked for the liberalization of  banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service tocustomers. Phone banking and net banking is introduced. The entiresystem became more convenient and swift. Time is given moreimportance than money. This resulted that Indian banking is growing atan astonishing rate, with Assets expected to reach US$1 trillion by 2010.“The banking industry should focus on having a small number of large players that can compete globally and can achieve expected goalsrather than having a large number of fragmented players."
KINDS OF BANKS
Financial requirements in a modern economy are of a diversenature, distinctive variety and large magnitude. Hence, different types of  banks have been instituted to cater to the varying needs of thecommunity. Banks in the organized sector may, however, be classified into the following major forms:
o
Commercial banks
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Anmol Johari added this note
can u plz mail me this on anmoljohari2@gmail.com ... thnx....
paramjot_251979755 added this note
good description on banking industry. please mail me at paramjot.sg@hotmail.com...thanks.
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