A Project Report on Banking Structure In India

IN
PARTIAL FULFILMENT OF
BACHELOR OF BUSINESS ADMINISTRATION
(S.Y.B.B.A.)

Savitribai Phule Pune University

SUBMITTED TO

K.V. N NAIK SHIKSHAN PRASARAK SANSTHA’S

ARTS, COMMERCE AND SCIENCE COLLEGE
CANADA CORNER, NASHIK – 02

Under guidance of
Prof Shibani Paul

ACADEMIC YEAR
2020-2021
Prepared by
MAYUR SANJAY BANKAR (Seat no: - 07 )

ACKOWLEDGEMENT
 It is a great pleasure to me in acknowledging my deep sense of gratitude to all
those who have helped me in completing this project successfully. First of all,I would
like to thank Savitribai Phule Pune University for providing me an opportunity to
undertake a project as a partial fulfilment of BBA degree. In addition providing
guidance in developing in my project.
I greatly appreciate the staff of the surveyed business unit, who responded
promptly and enthusiastically to my requests for frank comments despite their
congested schedules. I am indebted to all of them, who did their bestirring
improvements through their suggestions.
I would like to thanks Dr. Vasant Wagh (Principal), Mr. Sudam Bhabad
(HOD, & Project Guide) Ms. Neeta Sangale, Ms. Shibani Paul, Ms. Supriya Pawar &
department staff whose valuable guidance and encouragement at every phase of the
project has helped to prepare this project successfully.
All the faculties, office staff and library staff of Kr. V.N. NAIK College
Nasik and friends who helped me in some or other way in making this project.
THANK YOU

PLACE: NASHIK Name of the student

DATE: / /2021 Mayur Sanjay Bankar
 INDEX

CHAPTER TITLE PAGE NO

Chapter- 1 Introduction to Report

Chapter- 2 Structure of the Indian Banking System

2.1 Scheduled Banks

2.2 Non - Scheduled Banks

2.3 Development Banks

2.4 Financial Institutions

2.6 History Of Banks

Chapter-3 Research Methodology

1. Primary data

2. Secondary data
Chapter- 4 Conclusion.

Chapter -5 Suggestions.

Chapter- 6 Bibliography.
 Chapter- 1 : Introduction

• The Banking system of a country is an important pillar holding up the

financial system of the country’s economy. The major role of banks in a
financial system is the mobilization of deposits and disbursement of credit to
various sectors of the economy. The existing, elaborate banking structure of
India has evolved over several decades

• Banking in India in the modern sense originated in the last decades of the 18th
century. The first banks were Bank of Hindustan (17701829) and The General
Bank of India, established 1786 and since defunct. The largest bank, and the
oldest still in existence, is the State Bank of India, which originated in the
Bank of Calcutta in June 1806, which almost immediately became the Bank of
Bengal.

• This was one of the three presidency banks, the other two being the Bank of
Bombay and the Bank of Madras, all three of which were established under
charters from the British East India Company.

• The three banks merged in 1921 to form the Imperial Bank of India, which,
upon India's independence, became the State Bank of India in 1955.

• For many years the presidency banks acted as quasi-central banks, as did their
successors, until the Reserve Bank of India was established in 1935.
 Chapter- 2 : Structure of the Indian Banking System
Reserve Bank of India is the central bank of the country and regulates the banking
system of India. The structure of the banking system of India can be broadly divided
into scheduled banks, non-scheduled banks and development banks.

Banks that are included in the second schedule of the Reserve Bank of India Act, 1934
are considered to be scheduled banks.

All scheduled banks enjoy the following facilities:

• Such a bank becomes eligible for debts/loans on bank rate from the RBI
• Such a bank automatically acquires the membership of a clearing house.
• All banks which are not included in the second section of the Reserve Bank of India Act, 1934 are
Non-scheduled Banks. They are not eligible to borrow from the RBI for normal banking purposes
except for emergencies.
 Reserve Bank Of India

• Established in 1935

• Apex body of Indian banking system

• Headquarters is in Mumbai RBI Functions

• Financial supervision

• Regulator and supervisor of the financial system

• Regulator and supervisor of the payment and settlement systems

• Banker and debt manager to government

• Managing foreign exchange

• Issue of currency

• Banker's bank

• Regulator of the Banking System

• Detection of fake currency

• Developmental role • Custodian to foreign exchange

1. SCHEDULED BANKS

• Scheduled Banks in India refer to those banks which have been included in
the Second Schedule of Reserve Bank of India Act 1934.RBI in turn
includes only those banks in this Schedule which satisfy the criteria laid
down vide section 42(6)(a) of the said Act.

• Every Scheduled bank enjoys two types of principal facilities: it becomes

eligible for debts/loans at the bank rate from the RBI; and, it automatically
acquires the membership of clearing house

2. NON-SCHEDULED BANKS

• Non-scheduled banks are those banks whose name doesn’t appear in the
2nd schedule of Reserve Bank Of India Act, 1934. are mainly the local area
banks, and there are very few of them.

• These banks are not under any obligation to fulfill CRAR norms or keep
reserves. They work on the lines of a cooperative society and help people in
need with mutual aspirations. Subhadra Local Area Bank Ltd (Kolhapur)
and a few others.
 A) Commercial Banks

• Commercial banks in India are the backbone of all major economic activities in
the country, whether it is for the citizens to keep their hard-earned money
safely or get loans whenever they need funds for important things like a
home, wedding, a car or for business.

• Primary functions
• Accepting deposits

• Advancing loans

• Secondary functions
• Overdraft Facility

• Discounting bills of exchange

• Agency functions

• General utility functions

I. PUBLIC SECTOR BANKS

• Public sector banks are those banks which are owned and controlled by the
government .

• All the nationalized banks and regional rural banks are public sector banks.
These banks are the nationalized banks undertaken by the Government of
India in a way or the other.
 • Nationalized banks account for over 75% of the overall business transactions
that happen in the country. Out of all these public sector banks, we all know
the State Bank of India, which is now amongst the top 50 banks in the world.

• As per the recent reports, after the amalgamation of smaller banks with larger
banks, there are 12 public sector banks in India as of now.

 Public Sector Banks (Government Shareholding %, as of 1st January

2021)

1) State Bank of India (56.92%)

2) Punjab National Bank (85.59%)
3) Bank of Baroda (71.60%)
4) Canara Bank (78.52%)
5) Union Bank of India (89.07%)
6) Indian Bank (88.06%)
7) Bank of India (89.10%)
8) Central Bank of India (92.39%)
9) Indian Overseas Bank (95.84%)
10) UCO Bank (94.39%)
11) Bank of Maharashtra (92.49%)
12) Punjab and Sind Bank (83.06%)
13) India Post Payments Bank (100% owned by Indian Post)

by NSD L )

14) National Securities Depository Limited Payments Bank

(100% owned

i. State Bank of India & Associate Banks

• On 1st April 2017, SBI merged with 5 of its associate banks and one other
bank. This brought into SBI the 50 largest banks in the world.

• These associate banks included State Bank of Jaipur, Bikaner, Mysore,

Travancore, Hyderabad, and Patiala. The sixth bank was the Bharatiya Mahila
Bank. Although the banks were merged, the shares of this associate were
termed as individual entities.
 • There are many reasons that were cited for the merger. Some of these are: this
merger will decrease the unhealthy competition in the PSBs.

• Further, it was difficult for smaller banks to sustain competition and various
risk norms. Also, due to the changes in regulations in the form of Basel III,
risk norms there was a requirement of compliance and technology.

• With the merger, the asset size of SBI became the largest in the world. Banks
are now able to focus more on defaulters. Because of the merger, the multiple
recoveries can be made easier.

ii. Nationalized Bank

• Nationalization refers to the transfer of public sector assets to be operated or

owned by the state or central government. In India, the banks which were
previously functioning under private sector were transferred to the public
sector by the act of nationalization and thus the nationalized banks came into
existence.

• The history of banking in India states that the post-independence, the

Government of India initiated various measures to play an active role in the
economic development of the nation which resulted in the establishment of the
Reserve Bank of India in April 1935 and later nationalized the same during
1949 under the terms of the Reserve Bank of India Act of 1948 and another
measure is the nationalization of banks in India

• List of nationalized banks in India: As per the official website of The

Central Bank of India - RBI, the following 12 banks are listed as nationalized
banks.

1. Bank of Baroda
2. Bank of India
3. Bank of Maharashtra
4. Canara Bank
5. Central Bank of India
 6. Indian Bank
7. Indian Overseas Bank
8. Punjab and Sind Bank
9. Punjab National Bank
10. State Bank of India
11. UCO Bank
12. Union Bank of India

II. PRIVATE SECTOR BANKS

• These banks are owned and controlled by private institutions or individuals

and not by the government.

• private sector banks are the ones that work on similar lines as the nationalized
banks do, the only difference is that the majority stakes in these banks are
privately owned, as in the major stakes in the equity are owned by private
stakeholders or business houses.

• These banks majorly work on the lines of profit-making by keeping deposits

providing loans and other products related to financial activities.

 Examples:
1) Axis Bank
2) Bandhan Bank
3) CSB Bank
4) City Union Bank 5) DCB Bank
6) Dhanlaxmi Bank
7) Federal Bank
8) HDFC Bank
9) ICICI Bank
10) IDBI Bank
 11) IDFC FIRST Bank
12) IndusInd Bank
13) J&K Bank
14) Karnataka Bank
15) Karur Vysya Bank
16) Kotak Mahindra Bank
17) Nainital Bank
18) RBL Bank
19) South Indian Bank
20) Tamilnad Mercantile Bank
21) YES Bank

III. FOREIGN BANKS

• A foreign bank is a bank having its head-quarter outside the country but run its
offices as a private entity at any other location outside the country. The
bank may have as many branches and offices they find suitable, they are
under an obligation to operate under the regulations provided by the central
bank of the country as well as the rule prescribed by the parent organization
located outside India.

 Examples : Following are the foreign banks operating in India.

1. Australia and New Zealand Banking Group Ltd.

2. National Australia Bank
3. Westpac Banking Corporation 4. Bank of Bahrain & Kuwait BSC
5. AB Bank Ltd.
6. Sonali Bank Ltd.
7. Bank of Nova Scotia
8. Industrial & Commercial Bank of China Ltd.
9. BNP Paribas
10. Credit Agricole Corporate & Investment Bank
11. Societe Generale
12. Deutsche Bank
13. HSBC Ltd
14. PT Bank Maybank Indonesia TBK
15. Mizuho Bank Ltd.
16. Sumitomo Mitsui Banking Corporation 17. The Bank of Tokyo-
Mitsubishi UFJ, Ltd.
18. Cooperative Rabobank U.A.
19. Doha Bank
20. Qatar National Bank SAQ
21. JSC VTB Bank 22. Sberbank
23. DBS Bank Ltd.
24. United Overseas Bank Ltd.
25. FirstRand Bank Ltd.
26. Shinhan Bank
27. Woori Bank
28. KEB Hana Bank
29. Industrial Bank of Korea
30. Bank of Ceylon
31. Credit Suisse A.G
32. CTBC Bank Co., Ltd.
33. Krung Thai Bank Public Co. Ltd.
34. Abu Dhabi Commercial Bank Ltd.
35. Mashreq Bank PSC
36. First Abu Dhabi Bank PJSC 37 .Emirates NBD Bank PJSC
38. Barclays Bank Plc.
39. Standard Chartered Bank
40. The Royal Bank of Scotland plc 41. American Express Banking Corp.
42. Bank of America
43. Citibank N.A.
44. J.P. Morgan Chase Bank N.A.
IV. REGIONAL RURAL BANKS

• Regional Rural Banks (RRBs) were established by Regional Rural Banks Act,
1976 with a view to satisfy the banking facilities and credit needs of the rural
people.

• The main objective behind the formation of such banks is to provide credit
support to economically weaker sections of the society like farmers, rural
traders and small business owners.

• These rural banks work on specific lines and serve major functions like
providing financial credit support to rural and semi-urban areas, provide
support for government schemes by processing payments for the national
pension scheme and MGNREGA beneficiaries.

• These banks are considered no less as compared to the nationalized banks, as

they also provide card and locker facilities to their customers.

 Examples: Below is the list of Regional Rural Banks in India.

1. Assam Gramin Vikash Bank

2. Andhra Pradesh Grameena Vikas Bank
3. Andhra Pragathi Grameena Bank
4. Arunachal Pradesh Rural Bank
5. Aryavart Bank
6. Bangiya Gramin Vikash Bank
7. Baroda Gujarat Gramin Bank
8. Baroda Rajasthan Kshetriya Gramin Bank
 9. Baroda UP Bank
10. Chaitanya Godavari GB
11. Chhattisgarh Rajya Gramin Bank
12. Dakshin Bihar Gramin Bank
13. Ellaquai Dehati Bank
14. Himachal Pradesh Gramin Bank
15. J&K Grameen Bank
16. Jharkhand Rajya Gramin Bank 17. Karnataka Gramin Bank
18. Karnataka Vikas Gramin Bank 19.
Kerala Gramin Bank
20. Madhya Pradesh Gramin Bank
21. Madhyanchal Gramin Bank
22. Maharashtra Gramin Bank
23. Manipur Rural Bank
24. Meghalaya Rural Bank
25. Mizoram Rural Bank
26. Nagaland Rural Bank
27. Odisha Gramya Bank
28. Paschim Banga Gramin Bank
29. Prathama U.P. Gramin Bank
30. Puduvai Bharathiar Grama Bank
31. Punjab Gramin Bank
32. Rajasthan Marudhara Gramin Bank
33. Saptagiri Grameena Bank
34. Sarva Haryana Gramin Bank
35. Saurashtra Gramin Bank
36. Tamil Nadu Grama Bank
37. Telangana Grameena Bank
38. Tripura Gramin Bank
39. Uttar Bihar Gramin Bank
40. Utkal Grameen Bank
41. Uttarbanga Kshetriya Gramin Bank
42. Vidharbha Konkan Gramin Bank
43. Uttarakhand Gramin Bank

B) CO-OPERATIVE BANKS
• Cooperative bank is an institution established on the cooperative basis and
dealing in ordinary banking business. Like other banks, the cooperative banks
are founded by collecting funds through shares, accept deposits and grant
loans.

• These are banks where co-operative societies that are formed at a state or
district level have a share of more than 51%. these are primarily set-up for the
purpose of services the farming community or to aid in land or infrastructure
development at the state or district level.

• Brief history

• The problem of rural credit was the key reason behind the advent of the
cooperative movement in India, which began with the passage of the Co-
operative Societies Act in 1904.

• Rural cooperative credit institutions could either be short-term or long-term in

nature. Further, short-term cooperative credit institutions are further
subdivided into State Cooperative Banks, District Central Co-operative Banks,
Primary Agricultural Credit Societies.

• Function :
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) Advance loans to the members
5) Rural financing for farming, cattle, milk, hatchery, personal finance, etc.
6) Urban financing for Self – employment, Industries Small scale units, Home
finance, Consumer finance, Personal finance
I. State Co-operative Banks

• It is a federation of central Co-operative bank and acts as a watchdog. They

obtain their funds from share capital, deposits, loans and overdrafts from the
Reserve Bank of India and can lend money to central co-operative banks and
primary societies and not directly to the farmers.
• They provide a link through which the Reserve Bank of India provides credit
to the cooperatives and thus participates in the rural finance.
• They function as balancing centers for the central cooperative banks by
making available the surplus funds of some central cooperative banks. The
central cooperative banks are not permitted to borrow or lend among
themselves,
• They finance, control and supervise the central cooperative banks, and,
through them, the primary credit societies.

• Examples:- List of State Cooperative Banks in india

1. Andaman and Nicobar State Co-operative Bank
2. Andhra Pradesh State Co-operative Bank
3. Arunachal Pradesh State Co-operative Apex Bank
4. Assam Co-operative Apex Bank
5. Bihar State Co-operative Bank
6. Chandigarh State Co-operative Bank
7. Chhattisgarh Rajya Sahakari Bank Maryadit
8. Delhi State Co-operative Bank
9. Goa State Co-operative Bank
10. Gujarat State Co-operative Bank
11. Haryana State Co-operative Apex Bank
12. Himachal Pradesh State Co-operative Bank
13. Jammu and Kashmir State Co-operativ Bank
14. Jharkhand State Co-operative Bank
15. Karnataka State Co-operative Apex Bank
16. Kerala State Co-operative Bank
17. Madhya Pradesh Rajya Sahakari Bank Maryadit
18. Maharashtra State Co-operative Bank
19. Manipur State Co-operative Bank
20. Meghalaya Co-operative Apex Bank
21. Mizoram Co-operative Apex Bank
22. Nagaland State Co-operative Bank
23. Odisha State Co-Operative Bank
24. Pondichery State Co-operative Bank
25. Punjab State Co-operative Bank
 26. Rajasthan State Co-operative Bank
27. Sikkim State Co-operative Bank
II. District Co-operative bank

• A District Co-operative Central Bank (DCCB) is a cooperative bank

operating at the district level in various parts of India. It was established to
provide banking to the rural hinterland for the agricultural sector with the
branches primarily established in rural and semi-urban areas

• These are the federations of primary credit societies in a district and are of
two types-those having a membership of primary societies only and those
having a membership of societies as well as individuals.

• The funds of the bank consist of share capital, deposits, loans and
overdrafts from state co-operative banks and joint stocks. These banks
provide finance to member societies within the limits of the borrowing
capacity of societies. They also conduct all the business of a joint stock
bank

 Examples:
1) Aurangabad District Central Co-operative Bank Ltd.
2) Beed District Central Co-operative Bank Ltd.
3) Bhandara District Central Co-operative Bank Ltd.
4) Buldhana District Central Co-operative Bank Ltd.
5) Chandrapur District Central Co-operative Bank Ltd.
6) Dhulia District Central Co-operative Bank Ltd.
7) Sholapur District Central Co-operative Bank Ltd.
8) Gadchiroli District Central Co-operative Bank Ltd.
9) Jalana District Central Co-operative Bank Ltd.
10) Jalgaon District Central Co-operative Bank Ltd.
11) Kolhapur District Central Co-operative Bank Ltd.
12) Latur District Central Co-operative Bank Ltd.
13) Mumbai District Central Co-operative Bank Ltd.
14) Nagpur District Central Co-operative Bank Ltd.
15) Nanded District Central Co-operative Bank Ltd.
16) Nasik District Central Co-operative Bank Ltd.
17) Osmanabad District Central Co-operative Bank Ltd.
18) Parbhani District Central Co-operative Bank Ltd.
19) Pune District Central Cooperative BankLtd.
20) Raigad District Central Co-operative Bank Ltd.
21) Ratnagiri District Central Co-operative Bank Ltd.
22) Sangli District Central Co-operative Bank Ltd.
23) Satara District Central Co-operative Bank Ltd.
 24) Sindhudurg District Central Co-operative Bank Ltd.
25) Gondia District Central Co-operative Bank Ltd.
26) Thane District Central Co-operative Bank Ltd.
27) Wardha District Central Co-operative Bank Ltd.
28) Yavatmal District Central Co-operative Bank Ltd.

III. Primary Credit Societies

• The primary cooperative credit society is an association of borrowers and

non-borrowers residing in a locality.

• The funds of the society are derived from the share capital and deposits of
members and loans from central cooperative banks.

• The borrowing powers of the members as well as of the society are fixed.

• The loans are given to members for the purchase of cattle, fodder, fertilizers,
pesticides, etc

• Examples:

1) Lokseva Multi State Credit Cooperative Society Ltd

2) Jai Mahesh Multi State Vehicle Services Cooperative Society Ltd
3) Fabtech Multi State Cooperative Credit society Ltd
4) Jeevan Jyoti Multi State Credit Cooperative Society Ltd,
5) Snehshree Multi State Cooperative Credit Society Ltd.,
6) Shri Dattatray Urban Multi State Cooperative Credit Society Ltd.,
7) Shield Multi State Cooperative Credit Society Ltd.,
8) Shri Bhagwant Multistate Credit Co-operative Society Limited
9) Shreeved Multi State Cooperative Credit Society Ltd
10) Bhandara Laxmi Multi State Credit Co-operative Society Limited 11)
Dhanmudra Urban Multi-state Co-operative Credit Society Ltd 12)
Sahayog Multi State Credit Cooperative Society Ltd.
13) SGM(Sant Gajanan Maharaj) Urban Multi State Cooperative Credit
Society Ltd.,
 Development Bank

3. Development Bank

• An outstanding financial development of the post-independence period has

been the rapid growth of development banks in the country. These banks
are specialised financial institutions which perform the twin functions of
providing medium and long-term finance to private entrepreneurs and of
performing various promotional roles conducive to economic development.

• As the name clearly suggests, they are development-oriented banks. As

banks, they provide finance. But they are unlike ordinary commercial banks
in three ways.

• First, they do not seek or accept deposits from the public as ordinary banks
do
 1) Industrial Development Bank-

• Established 1 July 1964

• To provide financial assistance to industrial enterprises.

• To promote institutions engaged in industrial development.

• To provide technical and administrative assistance for promotion management

or expansion of industry.

• To undertake market and investment research and surveys in connection with

development of industry.

2) National bank for agriculture and rural development (NABARD)

Established on the recommendations of B.Sivaramman Committee, (by Act 61, 1981

of Parliament) on 12 July 1982 to implement the National Bank for Agriculture and
Rural Development Act 1981. Functions of NABARD

• Credit Functions:
• Framing policy and guidelines for rural financial institutions. • Providing
credit facilities to issuing organizations

• Monitoring the flow of ground level rural credit.

• Preparation of credit plans annually for all districts for identification of credit
potential.
• Development Functions:
• Help cooperative banks and Regional Rural Banks to prepare development
actions plans for themselves.

• Help Regional Rural Banks and the sponsor banks to enter into Mou's with
state governments and cooperative banks to improve the affairs of the
Regional Rural Banks.

• Monitor implementation of development action plans of banks.

• Provide financial support for the training institutes of cooperative banks,
commercial banks and Regional Rural Banks.

• Provide financial assistance to cooperative banks for building improved

management information system, computerization of operations and
development of human resources.

• Supervisory Functions:

• Undertakes inspection of Regional Rural Banks (RRBs) and Cooperative

Banks (other than urban/primary cooperative banks) under the provisions of
Banking Regulation Act, 1949.

• Undertakes inspection of State Cooperative Agriculture and Rural

Development Banks (SCARDBs) and apex non- credit cooperative societies
on a voluntary basis.

• Provides recommendations to Reserve Bank of India on issue of licenses to

Cooperative Banks, opening of new branches by State Cooperative Banks and
Regional Rural Banks (RRBs).

• Undertakes portfolio inspections besides off-site surveillance of Cooperative

Banks and Regional Rural Banks (RRBs).
3) EXIM (Export-Import) Bank

• Established in 1 January 1982

• Planning, promoting and developing exports and

imports .

• Providing technical, administrative and managerial assistance for promotion,

management and expansion of exports.

• Undertaking market and investment surveys and techno-economic studies

related to development of exports of goods and services

4) National Hosing Bank

• Established in 9 July 1988

• To promote and develop specialized housing finance institutions for

mobilizing resources and extending credit for housing

• To provide refinance facilities to housing finance institutions and scheduled

banks

• To provide guarantee and underwriting facilities to housing finance

institutions
 • To formulate schemes for mobilization of resources and extension of credit
for housing, especially catering to the needs of economically weaker
sections of society

Financial Institutions

Industrial Industrial Credit

Finance Life Insurance
Corporation Of and Investment
Corporation of Corporation of
India (IFCI) India (LIC)
India (ICICI)

• To provide guidelines to housing finance institutions to ensure their healthy

growth

• To co-ordinate the working of all agencies connected with housing

Financial Institutions
4. Financial Institutions

• There are so many financial companies established in India to absorb the saving
of household sector. Government mobilizes this small saving in the
economy through these financial institutions. These major and small
institutions play the same role in the economy as the blood in the human
body. Some examples of these financial institutions are RBI, SEBI, IDBI,
EXIM Bank and Export Credit Guarantee Corporation of India (ECGC).
1)
Industrial Finance Corporation of India (IFCI)
• Established in 1948

• The main function of the IFCI is to provide medium and long-term loans and
advances to industrial and manufacturing concerns.

• The IFCI also provides guarantees to the loans taken by such industrial
companies.

• When a company is issuing shares or debentures the Industrial Finance

Corporation of India can choose to underwrite such securities.

• It also guarantees deferred payments in case of loans taken from foreign

banks in foreign currency.

• There is a special department the Merchant Banking & Allied Services

Department. They look after matters such as capital restructuring, mergers,
amalgamations, loan syndication, etc.

• It the process of promoting industrialization the Industrial Finance

Corporation of India has also promoted three subsidiaries of its own, namely
the IFCI Financial Services Ltd, IFCI Insurance Services Ltd and IFin. It
looks after the functioning and regulation of these three companies.
2)

Life Insurance Corporation Of India

• Established: 1 September 1956

• To carry on capital redemption business, annuity certain business or
reinsurance business in so far as such reinsurance business relating to life
insurance business;

• To invest the funds of the Corporation in such manner as the Corporation

may think fit and to take all such steps as may be necessary or expedient for
the protection or realization of any investment; including the taking over of
and administering any property offered as security for the investment until a
suitable opportunity arises for its disposal;

• To advance or lend money upon the security of any movable or immovable

property or otherwise;

• To borrow or raise any money in such manner and upon such security, as
the Corporation may think fit;

• To carry on any other business which may seem to the Corporation to be

capable of being conveniently carried on in connection with its business and
calculated directly or indirectly to render profitable the business of the
Corporation; and to do all such things as may be incidental or conducive to
the proper exercise of any of the powers of the Corporation.
3)

Industrial Credit and Investment Corporation of India

(ICICI)

• Established in 1 January 1955

• Providing finance in the form of long-term or medium term loans or equity

participation.

• Sponsoring and underwriting new issues of shares and other securities,

• Guaranteeing Loans from other private investment sources.

• Making funds available for reinvestment by revolving investment as rapidly as

possible.

• Providing project advisory services i.e. offering advice to private sector

companies in the pre-investment stages on Government policies and
procedures, feasibility studies and joint venture search, and to Central and
State Governments on specific policy related issues.
History of Bank

A. Early Phase of Indian Banks, from 1786 to 1969

The first bank, namely Bank of Bombay was established in 1720 in Bombay. Later on,
Bank of Hindustan was established in Calcutta in 1770. General Bank of India was
established in 1786. Bank of Hindustan carried on the business till 1906. First Joint
Stock Bank with limited liability established in India in 1881 was Oudh Commercial
Bank Ltd.

East India Company established the three independently functioning banks, also
known by the name of “Three Presidency Banks” - The Bank of Bengal in 1806, The
Bank of Bombay in 1840, and Bank of Madras in 1843. These three banks were
amalgamated in 1921 and given a new name as Imperial Bank of India. After
Independence, in 1955, the Imperial Bank of India was given the name "State Bank of
India".

In the surcharged atmosphere of Swadeshi Movement, a number of private banks with

Indian managements had been established by the businessmen from mid of the 19th
century onwards, prominent among them being Punjab National Bank Ltd., Bank of
India Ltd., Canara Bank Ltd, and Indian Bank Ltd. The first bank with fully Indian
management was Punjab National Bank Ltd. established on 19 May 1894, in Lahore .

B. Nationalization of Banks and the Banking Sector Reforms, from 1969 to 1991:

The number of banks in India in 1951 was the highest – 566. In 1960, RBI was
empowered to force the compulsory merger of the weak banks with the strong ones.
This led to a reduction in the number of banks to 89 in 1969.

On July 19, 1969, 14 major banks were nationalized.

On April 15, 1980, another six banks were nationalized and thus raising the number of
nationalized banks to 20.
C. New Phase of Indian Banking System, with the Reforms After 1991:

On the suggestions of Narasimha Committee, the Banking Regulation Act was

amended in 1993 and thus the gates for the new private sector banks were opened.

In 1993, New Bank of India was merged with Punjab National Bank. “Industrial
Development Bank of India (IDBI)” - was established as a Development Bank in
1964 by an act of Parliament. It was given the status of a scheduled bank in
September 2004 ByRBI.

Bharatiya Mahila Bank Ltd – all women’s bank was established in 2013. It is based in
New Delhi. Its first branch started its operations on November 19, 2013. The
inauguration was done by former Indian Prime Minister S. Manmohan Singh.

First in Banks: Banking History

• First bank in India- Bank of Hindustan (1770)

• First Bank managed by Indians- Oudh Commercial Bank

• First Bank with Indian Capital- Punjab National Bank (Founder

of the Bank is Lala Lajpat Rai)

• First Foreign Bank in India – HSBC

• First bank to get ISO certificate – Canara Bank

• First Indian bank outside India –Bank of India

• First Bank to introduce ATM – HSBC (1987, Mumbai)

• First Bank to have a joint-stock public bank (Oldest) –

Allahabad Bank

• First Universal bank – ICICI (Industrial Credit and Investment

Corporation of India)

• First bank to introduce saving account – Presidency Bank

(1833)

• First Bank to Introduce Cheque system – Bengal Bank (1833)

• First bank to give internet banking facility – ICICI

• First bank to sell mutual funds – State Bank of India

• First bank to issue credit cards - Central Bank of India

• First Digital Bank - Digibank

• First Rural Regional Bank (Grameen Bank) – Prathama Bank
(sponsored by Syndicate Bank)

• First bank to get ‘in principle’ banking license – IDFC and

Bandhan Bank

• First Bank to introduce merchant banking in India – Grind lays

bank

• First bank to introduce blockchain technology – ICICI

• First bank to introduce voice biometric – Citi Bank • First bank

to introduce robot in banking service- HDFC
• Miscellaneous points:

• Largest public sector bank in India – State Bank of India

• Largest private sector bank in India – ICICI

• Largest foreign bank in India – Standard Chartered Bank

• Bank with more branches in India – State Bank of India

 Chapter- 3 : Research Methodology

Primary Data :

Primary data is a type of data that is collected by researchers directly from main
sources through interviews, surveys, experiments, etc. Primary data are usually
collected from the source—where the data originally originates from and are regarded
as the best kind of data in research.

The sources of primary data are usually chosen and tailored specifically to meet the
demands or requirements of a particular research. Also, before choosing a data
collection source, things like the aim of the research and target population need to be
identified.

For example, when doing a market survey, the goal of the survey and the sample
population need to be identified first. This is what will determine what data collection
source will be most suitable—an offline survey will be more suitable for a population
living in remote areas without internet connection compared to online surveys.

Examples of Primary Data

• Market Research

This is an important aspect of business strategy that involves the process of gathering
information about the target market and customers. The data gathered during market
research is primary as it is tailored specifically to meet the business needs.

An organization doing market research about a new product (say phone) they are
about to release will need to collect data like purchasing power, feature preferences,
daily phone usage, etc. from the target market. The data from past surveys are not
used because the product differs.

• Student Thesis

When conducting academic research or a thesis experiment, students collect data from
the primary source. The kind of data collected during this process may vary according
to the kind of research being performed—lab experiments, statistical data gathering,
etc.

For example, a student carrying out a research project with the aim of finding out the
effect of daily intake of fruit juice on an individual's weight will need to take a sample
population of 2 or more people, feed them with fruit juice daily and record the
changes in their weight. The data gathered throughout this process is primary.
 • Trauma Survivors

Although people react differently to trauma, there is usually a trait common to people
who have gone through the same kind of trauma. The research aimed at finding out
how victims of sexual abuse overcame the traumatic experience will include
interviewing the survivors, sending them surveys, or any other primary source of data
collection.

Experiences differ and every situation is unique. Therefore, using secondary data may
not be the best option in this case.

Secondary Data :
Secondary data is the data that has already been collected through primary sources
and made readily available for researchers to use for their own research. It is a type of
data that has already been collected in the past.

A researcher may have collected the data for a particular project, then made it
available to be used by another researcher. The data may also have been collected for
general use with no specific research purpose like in the case of the national census.

A data classified as secondary for a particular research may be said to be primary for
another research. This is the case when a data is being reused, making it a primary
data for the first research and secondary data for the second research it is being used
for.

Sources of Secondary Data

Sources of secondary data includes books, personal sources, journal, newspaper,

website, government record etc. Secondary data are known to be readily available
compared to that of primary data. It requires very little research and need for
manpower to use these sources.

With the advent of electronic media and the internet, secondary data sources have
become more easily accessible. Some of these sources are highlighted below.

• Books

Books are one of the most traditional ways of collecting data. Today, there are books
available for all topics you can think of. When carrying out research, all you have to
do is look for a book on the topic being researched on, then select from the available
repository of books in that area. Books, when carefully chosen are an authentic source
of authentic data and can be useful in preparing a literature review.

• Published Sources

There are a variety of published sources available for different research topics. The
authenticity of the data generated from these sources depends majorly on the writer
and publishing company.

Published sources may be printed or electronic as the case may be. They may be paid
or free depending on the writer and publishing company's decision.

• Unpublished Personal Sources

This may not be readily available and easily accessible compared to the published
sources. They only become accessible if the researcher shares with another researcher
who is not allowed to share it with a third party.

For example, the product management team of an organization may need data on
customer feedback to assess what customers think about their product and
improvement suggestions. They will need to collect the data from the customer
service department, which primarily collected the data to improve customer service.

• Journal

Journals are gradually becoming more important than books these days when data
collection is concerned. This is because journals are updated regularly with new
publications on a periodic basis, therefore giving to date information.

Also, journals are usually more specific when it comes to research. For example, we
can have a journal on, "Secondary data collection for quantitative data" while a book
will simply be titled, "Secondary data collection".

• Newspapers

In most cases, the information passed through a newspaper is usually very reliable.
Hence, making it one of the most authentic sources of collecting secondary data.

The kind of data commonly shared in newspapers is usually more political, economic,
and educational than scientific. Therefore, newspapers may not be the best source for
scientific data collection.

• Websites

The information shared on websites are mostly not regulated and as such may not be
trusted compared to other sources. However, there are some regulated websites that
only share authentic data and can be trusted by researchers.
Most of these websites are usually government websites or private organizations that
are paid, data collectors.

• Blogs

Blogs are one of the most common online sources for data and may even be less
authentic than websites. These days, practically everyone owns a blog and a lot of
people use these blogs to drive traffic to their website or make money through paid
ads.

Therefore, they cannot always be trusted. For example, a blogger may write good
things about a product because he or she was paid to do so by the manufacturer even
though these things are not true.

• Diaries

They are personal records and as such rarely used for data collection by researchers.
Also, diaries are usually personal, except for these days when people now share
public diaries containing specific events in their life.

A common example of this is Anne Frank's diary which contained an accurate record
of the Nazi wars.

• Government Records

Government records are a very important and authentic source of secondary data.
They contain information useful in marketing, management, humanities, and social
science research.

Some of these records include; census data, health records, education institute
records, etc. They are usually collected to aid proper planning, allocation of funds,
and prioritizing of projects.

• Podcasts

Podcasts are gradually becoming very common these days, and a lot of people listen
to them as an alternative to radio. They are more or less like online radio stations and
are generating increasing popularity.

Information is usually shared during podcasts, and listeners can use it as a source of
data collection.

Some other sources of data collection include:

• Letters
• Radio station
• Public sector records.

Chapter- 4 : Conclusion
The banking system of a country has the capability to heavily influence the
development of a country’s economy. It is also instrumental in the development of
rural and suburban regions of a country as it provides capital for small businesses and
helps them to grow their business. The organized financial system comprises
Commercial Banks, Regional Rural Banks (RRBs), Urban Co-operative Banks
(UCBs), Primary Agricultural Credit Societies (PACS) etc. caters to the financial
service requirement of the people. The initiatives taken by the Reserve Bank and the
Government of India in order to promote financial inclusion have considerably
improved the access to the formal financial institutions. Thus, the banking system of a
country is very significant not only for economic growth but also for promoting
economic equality
 Chapter - 5 : Suggestions.

1. Structure of the banking sector should be revamped so as to have 3 or 4 large banks

which could become international in character.

2. Eight to ten national banks with a network of branches throughout the country
should be engaged in universal banking.

3. Local bank operations should be confined to a specific region.

4. Rural banks, including RRBs, should operate only in rural areas and their business
should be predominantly to engage in financing of agriculture and allied activities,
but based on profitability considerations.

5. One or more rural banking subsidiaries by each public sector bank should be set up
to take over all its rural branches.

6. RRBs should be allowed to engage in all types of banking business.

7. Abolition of branch licensing and opening or closing of branches should be left to the
individual banks.

8. Foreign banks should be permitted to open offices in India as branches or as

subsidiaries.

9. Foreign banks should be subject to the same requirements as applicable to Indian

banks.
 Chapter - 6 : Bibliography.

Websites
1) www.statebankofindia.com
2) www.bankofbaroda.com
3) www.denabank.com
4) www.canbankindia.com
5) www.citibank.com
6) www.hsbc.co.in/in
7) www.bankinq.state.nv.us/bdd.htm
8) www.mbamap.com/business-historv/finance-historv/bank-
bankrupt.htm
9) www.britannica.com/eb/article-21524
10) www.firstresearch.com/lndustrv-Research/Banks-and-
CreditUnions.html?Ovmkt=T012FD05DEUMM8EF13F0EH5O8K&OVRAW=Ban
king%20lndustrv&OVKEY=banking%20industrv&OVMTC=standard
11) www.bankers.asn.au/default.aspx
12) www.here4business.co.uk/blvny/salesmarketing/promotionalmix/
index.asp
13) www.indiamart.com
14) www.banknetindia.com
15) www.banknetindia.com
16) www.banknetindia.com
17) www.banknetindia.com/banking/bitpresentlevel.htm