I n India banks are classified into scheduled banks and non scheduled banks. Scheduled banks are those institutions which are listed in the second schedule of RBI act, 1934 satisfying the criteria laid down wide section 42(6)(A) of RBI act. Non scheduled bank means banking company as defined in the section 5 clause (C) of banking regulation act, 1949.
Scheduled banks:
All scheduled banks must fulfil the criteria under sec 42(6)(A) of RBI Act 1934. The criteria is the institution carries on business of banking in India and satisfies the Bank that its affairs are not being conducted in a manner detrimental to the interests of its depositors. Schedule banks are further classified into cooperative banks and commercial banks. All commercial banks, Regional Rural Banks, and state co-operative banks are scheduled banks. Most recently added bank under this
schedule is Bharatiya Mahila Bank (BMB) on 21st May, 2014.
Co-operative banks:
Co-operative banks are organized under provision of the co-operative society laws of states. Hence these banks are called as state cooperative banks. These banks are established with the primary aim of rural development and in particular agricultural and agricultural allied development in the state.
Commercial banks:
These are Banks which deals in money and credit. The primary objective is profits. Commercial banks have a wide range of activities and functions which covers the complete banking service system.
★ Commercial banks are further classified into public sector banks, private sector banks, regional rural banks and foreign banks. Public sector banks are again classified into nationalized banks and SBI and it's associated. There are 27 nationalised banks in which 6 are SBI and its associates.
The major functions of Commercial banks are .....
★ Receiving money in the form of deposits from public and business units. The deposits are of like savings accounts, current accounts, fixed deposits and lend money, generally for short periods, in the form of loans, overdrafts, bills discounting, money market, term loans, consumer credit and cash credits. The difference between the rate of interest allowed on deposits and the rate charged on the Loans is the income source and cycle of money flow in economy. This generates money in the economy.
★ They provide foreign trade and services.
★ Promotes the usage of banking services with a aim of mobilizing financial transactions form un-organized sector to organized banking sector with the help of clearing system and instruments like cheques, drafts which are cheaper way of medium of exchange.
Scheduled banks:
All scheduled banks must fulfil the criteria under sec 42(6)(A) of RBI Act 1934. The criteria is the institution carries on business of banking in India and satisfies the Bank that its affairs are not being conducted in a manner detrimental to the interests of its depositors. Schedule banks are further classified into cooperative banks and commercial banks. All commercial banks, Regional Rural Banks, and state co-operative banks are scheduled banks. Most recently added bank under this
schedule is Bharatiya Mahila Bank (BMB) on 21st May, 2014.
Co-operative banks:
Co-operative banks are organized under provision of the co-operative society laws of states. Hence these banks are called as state cooperative banks. These banks are established with the primary aim of rural development and in particular agricultural and agricultural allied development in the state.
Commercial banks:
These are Banks which deals in money and credit. The primary objective is profits. Commercial banks have a wide range of activities and functions which covers the complete banking service system.
★ Commercial banks are further classified into public sector banks, private sector banks, regional rural banks and foreign banks. Public sector banks are again classified into nationalized banks and SBI and it's associated. There are 27 nationalised banks in which 6 are SBI and its associates.
The major functions of Commercial banks are .....
★ Receiving money in the form of deposits from public and business units. The deposits are of like savings accounts, current accounts, fixed deposits and lend money, generally for short periods, in the form of loans, overdrafts, bills discounting, money market, term loans, consumer credit and cash credits. The difference between the rate of interest allowed on deposits and the rate charged on the Loans is the income source and cycle of money flow in economy. This generates money in the economy.
★ They provide foreign trade and services.
★ Promotes the usage of banking services with a aim of mobilizing financial transactions form un-organized sector to organized banking sector with the help of clearing system and instruments like cheques, drafts which are cheaper way of medium of exchange.
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