1.

Introduction:
Banks have been around since the first currency was formed In the early days of ancient
empires temples were considered to be the safest place to keep valuable commodities. Origin
in the word bank used in the sense of a commercial bank. It is of Germanic origin though
some persons trace its origin to the French word Banqui and the Italian word Banca (Long
Bench)
2. The First Bank:
The Romans great builders and administrators of that time took banking out of the temples.
The first bank called the Bank of Venice was establish in Venice Italy in 1157 to finance the
monarch in his wars.
3. Evolution of Bank
The Goldsmith He had to take special precautions against theft of gold and jewellery. The
goldsmith started charging something for taking care of the money and valuables. The
goldsmith receipt became like cheques as a medium of exchange and a means of payment.
The Moneylenders Goldsmith started advancing the coins on loan by charging interest. He
became a banker who started performing the two functions of modern banking that of
accepting deposits and advancing loans.
4. The Establishment of Banking System:
The modern banking system started in Venice in 1587, and in the same year the Banco di
Rialto was established. People could deposit even their gold and silver items in this bank for
which the bank issued receipts. These receipts were used as currency notes.
5. Modern Banking System:
When a bank makes loan it does not take other people’s deposits and lend them out. When a
bank makes a ‘loan’ it simply types in to its account that the borrower owes it a sum of
money this is the bank’s asset. On the process of depositing money in the bank, lending it,
getting interest on the deposited money, the whole banking system works. The first bank in
the U.S.A. was set up in Philadelphia in the year 1782. In England, the first bank was started
in the year 1825. Nowadays, Banks serve many other purposes such as giving credit cards
and foreign currency to people going abroad. Banks also provide us the facility of lockers to
keep our valuable jewellery.
6. INTERNET BANKING:
It is also called as Net Banking, E-banking, Online Banking, Virtual Banking. It offers fastest
and cheapest mode of banking where customer uses internet facility
7. CORE BANKING:
Commonly known as fully computerized banking. All the branches of a bank are linked to a
core computer so that the data is accessible anywhere anytime Computers are linked to a core
computer called Server.
8. MOBILE PHONE BANKING:
As per recent RBI guidelines, there is no financial limit for transactions in a day. It refers to
doing actual banking transactions through mobile phone
9. IMMEDIATE PAYMENTS SERVICES – IMPS:
Developed by National Payment Corporation of India (NPCI) It offers an instant, 24×7
services to facilitate use of cell phones as a channel For accessing bank accounts and execute
interbank fund transfers
10. TELE BANKING:
It refers to telephone based banking. In contrast to mobile banking, no transactions are
allowed in Tele-banking. It is call centre based banking.
11. Automated Teller Machine (ATM):
Atms facilitate cash withdrawal from one’s account any time anywhere. Such as fee-deposit,
online payment of bills, mobile recharge, and fund transfers. Confidential PIN (Personal
Identification Number) to activate the ATM.
12. DEBIT / CREDIT CARDS:
Also referred to as Plastic Money. A debit card is linked to a specific bank account and can
be used to operate only that account. The credit card holder gets a monthly bill for the
transactions.
13. VISA / MASTER CARD
These are two international card service providers (Global Payment Gateways). All
transactions put through various debit / credit cards are coordinated and serviced by these two
companies.

Types of Banks
1. Saving banks:
A savings bank is a financial institution whose primary purpose is accepting saving deposits
and paying interest on those deposits. These banks were often designed to encourage low
income people to save money and have access to banking services. Savings bank said to have
been established in 1765 in the town of Brumath. But the savings bank idea was suggested in
England as early as 1697. There was a savings bank in Hamburg, Germany, in 1778.
2. Direct banks:
Is a bank without any branch network that offers its services remotely via online banking and
telephone banking. Direct bank also provide access via atms, mail and mobile. One of the
world's first fully functional direct banks was First Direct, which launched telephone banking
in the United Kingdom on 1 October 1989. The commercialization of the Internet in the early
1990s was the biggest driver in the creation of full direct banking models.
3. Private banks:
Private banks became known as ‘Private’ to stand out from the retail banking & savings
banks aimed at the new middle class. They often advised and performed all financial &
banking services for families. The first banks in Venice were focused on managing personal
finance for wealthy families. Private banks have a long tradition in the UK where C. Hoare &
Co. Has been in business since 1672.
4. Commercial Banks:
A commercial bank is a type of financial institution that provides services such as accepting
deposits, making business loans, and offering basic investment products. Commercial banks
are established with an objective to help businessmen. The Commercial Bank was founded in
1924 by local businessmen in Oglethorpe country with the mission of serving the financial
needs of the citizens and businesses of the area.
5. Community bank:
A community bank is a depository institution that is typically locally owned and operated.
Community banks tend to focus on the needs of the businesses and families where the bank
holds branches and offices. August 18, 1945, Huntington Park Bank opened its doors. In
1950, Huntington Park Bank changed its name to Community, and to underscore the Bank’s
commitment to the communities it served.
6. Online banks:
Online Banks operate entirely online there are no physical branch locations available to visit
with a teller or personal banker. Online banking was first introduced in the early 1980s in
New York, United States. Almost simultaneously with the United States, online banking
arrived in the United Kingdom.The UK's first home online banking services known as
Homelink was set up by Bank of Scotland for customers
7. Mutual banks
A mutual savings bank is a financial institution chartered by a central or regional
government, without capital stock, that is owned by its members who subscribe to a common
fund. The Reverend Henry Duncan in 1810, in Ruthwell, Scotland. Rev. Duncan established
the small bank in order to encourage his working class.The banks were started by
philanthropists, who took on the positions of savings bank trustees, managers, and directors.
8. Central banks:
Central banks manage the monetary system for a government. For example, the Federal
Reserve Bank is the US central bank responsible for managing economic activity and
supervising banks. The first institution recognized as a central bank, the Swedish Riksbank.
Established in 1668 as a joint stock bank. A few decades later (1694), the most famous
central bank of the era, the Bank of England, was founded also as a joint stock company to
purchase government debt.
9. Ethical banks:
An ethical bank, also known as a social, alternative, civic, or sustainable bank, is a bank
concerned with the social and environmental impacts of its investments and loans. The
cooperative movement and the new social movements from the 1960’s have developed a
practice of ethical banking.
10. Investment banks:
Investment banks help businesses work in financial markets. If a business wants to go public
or sell debt to investors, they shell often use an investment bank. The term ‘investment bank’
came into common usage in the late 19th early 20th centuries, particularly in the United
States.
11. Retail Banks:
Retail banks are probably the banks you’re most familiar with: Your checking and savings
accounts are held at a retail bank, which focuses on consumers. These banks give you credit
cards, offer loans, and they’re the ones with numerous branch locations in populated areas. In
the 18th century several initiatives were taken to carry out this task. In 1810, Ruthwell
Savings Bank was established in Scotland by the Rev. Henry Duncan.