Reserve Bank of India and Its Role: The Reserve Bank of India Act, 1934 (2 of 1934) -

Organisation of the RBI – Reserve Bank of India and Commercial Banks – Functions of the RBI:
Commercial Banks maintain Account with RBI, RBI issues licence to Commercial Banks, Power
to Control Volume of Credit, Bank Rate, Open Market Operation, Cash Reserve Ratio, Statutory
Liquidity Ratio – Banking Regulation Act (10 of 1949).

Evolution of Banking Institutions: Origin of the word Bank, Early History of Banking – History
of Banking in India – Banks in India: Commercial Banks, Public Sector Banks, Private Sector
Banks, Foreign Banks, Regional Rural Banks, Development Banks, Co – operative Banks,
Functions of Commercial Banks –Types of Bank Accounts: Saving Account, Current Account,
Fixed Deposit Account, Recurring Deposit Account – Electronic Banking: Meaning and Types:
National Electronic Fund Transfer (NEFT), Real Time Gross Settlement (RTGS), Electronic
Clearing System, Automated Teller Machine (ATM) – Legal Framework For Electronic
Transactions.

Meaning of term Banker and Customer – Types of Customers: Individuals, Hindu Undivided
Family(HUF), Firms, Companies, Trusts, Co – operative Societies – ‘Know Your Customer’
(KYC) Guidelines of the RBI – Relation between Banker and Customer: Debtor and Creditor,
Banker as Agent of Customer, Banker as a Trustee, Banker as a Bailee – Banker’s Duty towards
Customer: Banker Obligation to Honour Cheques, Bankers Duty as a Bailee of Articles, Duty of
Banker to Act as per Directions, Secrecy of Customer’s Account.

The Negotiable Instruments Act, 1881 (26 of 1881) – Objects of the NI Act – Characteristics of
Negotiable Instruments – Types of Negotiable Instruments: Promissory Note, Bill of Exchange,
Cheque including electronic cheque – Bankers Draft: Bill of Exchange and Negotiable
Instrument, Issue of Duplicate, Stop Payment/Cancellation of Draft.