Learning outcome

• Familiarity with Indian banking

• Origination of banking
• Exploring different phases of banking
Transfer of money from those
who save it to those who need it.

Banks are playing role of

mediocre between people who
save money and people who
need money
Money is transferred as per the
need of the person which include
Total amount, Time, Repayment
conditions
 What is bank
• A financial institution whose primary activity is to act as
a payment agent for customers and to borrow and lend
agent for customers.

• An institution where one can place and borrow money

and take care of financial affairs

• In simple terms, a bank is an institution that accepts

various types of deposits and then advances money in
form of loans to people requiring it.
 Brief History- World banking
• Formal bank was established in 1157 named
Bank of Venice
• 1st public sector bank was established in 1336
in Barcelona, Florance.
• Bank of Amsterdam in 1609
• Bank of England 1694
 Brief History- Indian banking
• Bank of Hindustan, established in 1770 and
liquidated in 1829-32; and the General Bank of
India, established 1786 but failed in 1791.

• PNB was the 1st bank managed by Indians and

established in 1895.
 Evolution of banking in India
Phase I
Pre-Independence Stage – Before 1947

• The first bank of India was established in 1770 with the name of Bank of
Hindustan.

• Top three banks were merge during this phase – Bank of Bengal, Bank of
Bombay & Bank of Madras and came into being as  Imperial Bank, which
was later taken over by SBI in 1955

• Some other banks were also established during this period like Allahabad
Bank 1865, Punjab National Bank 1894, Bank of India 1906, Bank of
Baroda 1908, Central Bank of India 1911
 Cont…
Phase II – 1947 to 1991

• Nationalization of 14 Banks took place in 1969 and 6

more banks nationalized in 1980 during this period.

• Central bank of India was also nationalised during this

period on 1st January 1949.

• Regional Rural Banks were formed on 2nd October 1975.

14 Banks nationalised in 1969 and 6 were nationlised 1980

State Bank of India Bank of India Allahabad Bank

Bank of Maharashtra Canara Bank Indian Overseas Bank

Punjab & Sind Bank Punjab National Bank Syndicate Bank

Corporation Bank Andhra Bank UCO Bank

Bank of Baroda Union Bank of India United Bank of India

Vijaya Bank Dena Bank Indian Bank

Oriental Bank of Commerce Central Bank of India

 Cont…
Phase III – 1991 onwards

• Liberalized economic policies were in the year 1991 to

develop banking

• This phase was of expansion, consolidation, and

increment in many ways in the banking sector.

• RBI also gave license to 10 private entities which

include – ICICI, Axis Bank, HDFC, DCB, Indusland Bank.
 Indian Banking System- Important

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

• First Bank managed by Indians was  Oudh Commercial Bank
• First Bank with Indian Capital was Punjab National Bank (Founder of the Bank is Lala
Lajpat Rai)
• First Foreign Bank in India is HSBC
• First bank to get ISO certificate is Canara Bank
• First Indian bank outside India  is Bank of India
• First Bank to introduce ATM  is HSBC (1987, Mumbai)
• First Bank to have a joint-stock public bank (Oldest)  is Allahabad Bank
• First Universal bank  is ICICI (Industrial Credit and Investment Corporation of India)
• First bank to introduce saving account  is Presidency Bank (1833)
• First Bank to Introduce Cheque system  is  Bengal Bank (1833)
 Cont..
• First bank to give internet banking facility is ICICI
• First bank to sell mutual funds  is  State Bank of India
• First bank to issue credit cards  is Central Bank of India
• First Digital Bank  is Digibank
• First Rural Regional Bank (Grameen Bank)  is  Prathama Bank
(sponsored by Syndicate Bank)
• First bank to get ‘in principle’ banking license  is  IDFC and Bandhan
Bank
• First Bank to introduce merchant banking in India is  Grind lays bank
• First bank to introduce blockchain technology  is  ICICI
• First bank to introduce voice biometric  is Citi Bank
• First bank to introduce robot in banking service is HDFC
 Self test questions
• What is Bank?
• What was the first bank in the world?
• Name the first bank established in India?
• How many banks were nationalised in 1969?
• How many phases of banking growth in India?
Any doubts