Banking in India

Banking in India was born in the last decade of the 18th century. At that time, the first banks were Bank of Hindustan, and the General Bank of India, which were later liquidated or failed. The largest bank in the history of India that is still into existence is the State Bank of India, which was born as the Bank of Calcutta in 1806. But, in 1921, it was merged with Bank of Bombay and Bank of Madras, to form the Imperial Bank of India. It was renamed as the State Bank of India in 1955.

In 1839, Indians made an effort to establish a bank known as Union Bank, which failed within a decade. Later came Allahabad Bank in 1865, which is India’s one of the oldest Joint Stock Banks. The first bank, purely managed by Indians was the Punjab National Bank, which was established in Lahore in 1895. Not only is it surviving till date, but also it is one of the largest banks of India. The first commercial bank which was entirely managed and owned by Indians was the Central Bank in 1911. Hence it is the first true Swadeshi Bank of India.

Generally, banking in India was going good in terms of supply, but reaching out to rural India was still a difficulty. Hence the National Bank for Agriculture and Rural Development was launched to extend the banking network to rural India.

Scheduled banks are those banks which are included in the Second Schedule to Reserve Bank of India Act. These banks include commercial and co-operative banks both. Scheduled commercial banks are of 5 types, depending upon their ownership or nature of operation: State Bank of India and its associates, Nationalised banks, Private Sector Banks, Foreign banks, ad Regional Rural Banks.

Click here for government certification in Accounting, Banking & Finance