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Group membersNameAnand bhattAlka makwanaChandni parikhIshita shahParth voraRoll no.103119124134147Introduction to BankingContentsMeaning and DefinitionEvolution of BankingFunctions of BankDifferent Types of BankMeaning and DefinitionMeaning:A bank is an institution which deals in money and credit. Thus bank is an intermediary which handles other peoples money both for their advantage and to its own profit.Definition:Dr. L.Hart, says that the bankers as one who in the ordinary course of business honours cheque drawn upon him by person from and for whom he receives money on current accounts.Evolution Of BankingThe development of banking is evolutionary in nature.The word bank is derived from the French bancus or banque which means a bench.Thus, the origin of the word bank can be traced as follows:

Functions of banksDealing in money: The banks deals in money. They accept deposits from the public. There are different types of deposits such as saving, current, fixed, recurring, etc. banks advance money as loans to the needy people.Agency: banks act as an agents of the customer. They provide variety of agency services, besides the basic function of accepting deposits and lending money. Fund transfer, credit cards, telebanking, cheque clearing, bills collection are some of the services provided by the banks as an agent.Credit creation: creation of credit is an unique features of banking. Every deposits can create credit. Additional money cab be created for the purpose of lending. There is a limit for such credit.Commercial nature: all the banking function are carried out with the aim of making profit. They pay interest on deposits and these deposits are advanced to the needy persons at a higher rate of interest.Different banksCo-operative BanksRBIDevelopment bankCommercial bankPrivate BankNationalized BankShort term creditLong term creditEximAgricultureIndustrialAgriculture creditUrban creditReserve bank of IndiaThe reserve bank of India was originally constituted as a shareholders bank in 1935 under the reserve bank of India Act, 1934.The bank was nationalised on 1st January, 1949.The bank is vested with large powers of supervision, control, direction and inspection of scheduled and non-scheduled banks.

Role and function of RBINote Issuing AuthorityGovernment BankerBankers BankExchange Management And ControlSupervising AuthorityCredit ControlDevelopment And Promotion Export Finance

Commercial bankCommercial banks are the oldest and fastest growing banks in India.Commercial banks include scheduled, non-scheduled, Indian, foreign , public sector, private sector and regional rural banksThe commercial banks have undergone a major transformation with the introduction of new economic policy of Liberalization , Privatization and GlobalizationFunction of commercial bankAccepting depositsGiving loansCreation of creditBill discountingRemitting fundsMiscellaneous fundsAgency functionClassification of commercial banksScheduled banksA bank in order to be designated as a scheduled bank, should have a paid up capital and reserves as prescribed by the Act. As per section 42 (6) of the Reserve Bank has prescribed a minimum capital of Rs.100 crores.The scheduled banks are required to maintain with the Reserve bank a deposit in the form of Cash Reserve Ratio, based on its demand and time liabilities, at a prescribed rate.Non-Scheduled BanksThe commercial banks which are not included in the second schedule of the Reserve Bank of India Act, 1934 are called as Non-scheduled Banks.They are not entitled to facilities like refinance, and rediscounting of bills from the Reserve bank. They do not get the privileges that are available to the scheduled banks.Co-operative banksThe co-operative banking started in India in 1904, when official efforts were initiated to create new type of institution based on the principles of co-operation.Co-operative banks are managed by the board of directors on the principles of co-operation, self-help and mutual help. They function as per rule of one member- one vote.They also get financial help from Reserve Bank Of India.

Function of co-operative banksThe short term structure of co-operative banks like primary agriculture credit societies accept the deposit and provide timely adequate short term and medium term loans to member on reasonable rate of interest, terms conditions.To undertake educative, advisory and welfare functions for the benefit of farmers.To promote the economic interests of members.To provide a safe place for investing the reserves of primary societies.Regional rural banks (RRBs)Regional rural banks were set up under an of parliament in 1976, with the objective of developing rural economy through promotion of agriculture, trade, commerce, industry and extending credit, particularly to the small entrepreneurs.Objectives of RRBsTo provide credit facilitates to the farmers, agricultural labourers and others those engaged in rural activities.To develop agriculture, commerce, trade, industry and other productive activities in the rural areas.To encourage rural entrepreneurship.To increase employment opportunities in the rural areas.Development banksDevelopment banking was conceived as an instrument for achievement of national economic objectives.Government intervention to promote economic growth.High protection to domestic industry.Promotion of fixed capital assets through different subsidies.Function of development banksDevelopment banks play an important role in the promotion and development of the small scale sector. SIDBI provides direct finance to SSI units. It also refinances banks and financial institutions that provide seed capital equipment finance, etc.Govt. of India started the National Housing Bank (NHB) in 1988. It promises and develops housing and financial institutions.NABARD started in 1982 to provide refinance to banks which provide credit to the agriculture sector and also for rural development activities and also helps to conduct agricultural research.Govt. of India started EXIM Bank in 1982 t provide medium and long-term finance to exporters and importers from India. It provides overseas buyers credit to buy Indian capital goods.Thank you