History · Structure · RBI · Monetary Policy · NBFC · Financial Institutions — BPSC / BSSC
| Organised | Unorganised |
|---|---|
| Reserve Bank of India | Native Banker |
| Commercial Bank | Money Lender |
| Financial Institution | Private Person — deals on own terms |
| Follows Banking Rules | Does not follow banking rules |
SBI is the largest commercial bank of India. Bank Sakhi: Women SHG members appointed as banking agents.
| Bank | Founded / Founder | HQ | Branches |
|---|---|---|---|
| Punjab National Bank | 19 May 1894, Lahore, as Dayal Singh Bank; public sector status by Majithia & Lala Lajpat Rai, 12 April 1895 | New Delhi | 12,248 India, 1 Abroad |
| Canara Bank | 1 July 1906, Mangalore, by Ammembal Subba Rao Pai | Bengaluru | 9,877 India, 6 Abroad |
| Bank of India | 7 September 1906, by Ramnarayen Rujhyo | Mumbai | 5,089 India, 23 Abroad |
| Indian Bank | 5 March 1907 (opened 15 Aug 1907), Founder: M.S. Ramaswami Chettiar | Chennai | 5,770 India, 3 Abroad |
| Punjab & Sind Bank | 29 June 1908, by Bhai Veer Singh, Sundar Singh Majithia, Sardar Trilochan Singh | New Delhi | 1,526 India |
| Bank of Baroda | 20 July 1908, by Maharaja Sayajirao Gaikwad III | Vadodara (Corp. Office: Mumbai) | 3,454 India, 82 Abroad |
| Central Bank of India | 21 December 1911, by Sir Sorabji Pochkhanwala | Mumbai | 4,695 India |
| Union Bank of India | 11 November 1919, by Seth Sitaram Poddar; formally opened by Mahatma Gandhi (1921) | Mumbai | 8,700 India, 3 Abroad |
| Bank of Maharashtra | 16 September 1935, by V.G. Kale and V.K. Sathe | Pune | 2,641 India |
| Indian Overseas Bank | 10 February 1937, by M. Ct. M. Chidambaram Chettiar | Chennai | 3,219 India, 4 Abroad |
| UCO Bank | 6 January 1943, by Ghanshyam Das Birla | Kolkata | 230 India, 2 Abroad |
Work: Provide loans to weaker sections at low interest rates; promote savings in rural areas.
Shree Mahila Seva Cooperative Bank: Established 1974, Founder Elaben Bhatt, HQ Ahmedabad.
Provide loans to Central/District Co-operative Banks.
Area of work limited to one district; acts as a bridge between State Co-operative Banks and Co-operative Credit Societies.
A group of at least 10 persons in a village/area formed to fulfill short-term loan requirements of the agriculture sector.
Scope limited to metros, semi-urban, urban centres; provides loans to micro/small/medium industries, small entrepreneurs, retail traders. Number of UCBs in India: ~1500.
Multi-State Co-operative Society: Registered under the Multi-State Co-operative Societies Act, 2002.
Major banks: ICICI Bank, Axis Bank, HDFC Bank, Kotak Mahindra Bank, Yes Bank
Self Help Group (SHG): Main contribution in improving the economic condition of poor women in rural areas; loans given by the bank to individual members of the community.
| Bank | Country |
|---|---|
| Standard Chartered Bank | Britain |
| HSBC | Hong Kong |
| Deutsche Bank | Germany |
| American Express Bank Limited | America |
| Bank of Nova Scotia | Canada |
RBI played the role of the central bank for Burma until 1947.
| Position | Name | Tenure |
|---|---|---|
| First Governor | Sir Osborne Smith | 1 April 1935 – 30 June 1937 |
| First Indian Governor (3rd Governor) | C.D. Deshmukh | — |
| Current Governor (26th) | Sanjay Malhotra | From 11 December 2024 |
Minimum Fund System (1957): ₹200 crore (Gold worth ₹115 crore + Foreign securities worth ₹85 crore). Clear Note Policy (1999): providing good quality currency notes and coins.
| Institute | Place | Material |
|---|---|---|
| Currency Notes Press (1928) | Nashik (Maharashtra) | Bank notes ₹1 to ₹100 |
| Security Paper Mill (1967–68) | Hoshangabad (Madhya Pradesh) | Bank and currency note paper |
| Banknote Press (1974) | Dewas (Madhya Pradesh) | Bank notes ₹20, ₹50, ₹100, ₹200, ₹500 |
| Security Printing Press (1982) | Hyderabad (Telangana) | Central excise stamp |
| India Security Press (1992) | Nashik (Maharashtra) | Postage stamps, postal orders |
| Modern Currency Note Press (1995) | Mysore (Karnataka) & Shalbani (West Bengal) | Modern currency notes |
Indian coins are minted in Mumbai, Kolkata, Hyderabad, and Noida.
Monetary Policy is formulated by RBI in consultation with the MPC; works to control money and credit in the economy; target is price stability in the economy.
| Tool | Key Facts |
|---|---|
| Bank Rate | RBI provides long-term loans on first-class securities of banks; decrease in bank rate during monetary contraction |
| Repo Rate | Rate at which RBI lends short-term loans to banks; increase → decreases bank liquidity; decrease → increases liquidity |
| Reverse Repo Rate | Opposite of repo rate; rate at which banks deposit excess money with RBI; increase → reduces liquidity; decrease → increases liquidity |
| SLR | Retention of NDTL by banks (min 0%, max 40%); minimum limit abolished in 2007; currently 18%; increase → decreases liquidity |
| CRR | Banks keep a portion of total deposits (NDTL) in cash with RBI; ranges 3–15% |
| Open Market Operations (OMO) | RBI buys/sells securities; selling absorbs excess liquidity, buying injects liquidity |
| Marginal Standing Facility | Short-term lending to banks by RBI |
| Standing Deposit Facility | Effective from 8 April 2022; short-term deposits by banks in RBI; rate 0.25% less than Repo |
| Liquidity Management Framework (LMF) | Commenced 2014, amended 2020; bank borrowing capped at 1% of NDTL per day |
| Liquidity Adjustment Facility (LAF) | Includes repo and reverse repo; adopted in 2000 |
| Base Rate | Implemented 2010 by RBI; banks cannot lend below this rate |
| External Benchmark Based Lending Rate (EBLR) | RBI mandated use of EBLR for bank lending rates in 2018; 4 benchmark options including Repo rate |
NDTL = Net Demand and Time Liabilities. Demand Liabilities: Savings account, Current account. Time Liabilities: Fixed deposit, Recurring deposit.
Sectors covered: Agriculture, Education, Housing, Micro and Small Enterprises, Export Credit, Social Infrastructure, Renewable Energy, etc.
Basel is a city in Switzerland; Basel Committee formed in 1974 with 10 member countries; joined by Bank for International Settlements (BIS) in 1930; objective is to give international character to banking and financial institutions.
| Norms | Details |
|---|---|
| Basel-I | Issued 1988; India adopted in 1999; CAR requirement 8% |
| Basel-II | Released in 2004 |
| Basel-III | Proposed 2009, implemented from 2010; Capital divided into Tier-1, Tier-2, Tier-3; CAR maintained at 8% |
Capital Adequacy Ratio (CAR), also known as Capital-to-Risk Weighted Assets Ratio (CRAR): measurement of a bank's available capital as a % of risk-weighted credit exposure.
All loans on which interest and principal have not been paid within 90 days.
Wilful Defaulter: Deliberately not repaying a loan despite being capable of doing so.
Indradhanush Yojana (2015): Improve functioning of public sector banks. Components: Appointment, Capitalisation, De-stressing, Empowerment, Framework of accountability, Governance.
Accept deposits, offer loans, no deposit limits.
Only accepts deposits (up to ₹2 lakh per customer); issues only debit cards.
Bandhan Financial Services: Established 2001, HQ Kolkata. India Post Payments Bank: Started 1 September 2018.
| Category | Loan Range |
|---|---|
| Shishu | Up to ₹50,000 |
| Kishor | Above ₹50,000 up to ₹5 lakh |
| Tarun | ₹5 lakh to ₹10 lakh |
| Tarun (Plus) | Valid for loans up to ₹20 lakh after previous payment |
Registered under the Companies Act, 1956 or 2013; main function is providing loans.
| Type | Key Facts |
|---|---|
| NBFC-D | Accepts deposits; requires registration with RBI; demand deposit not accepted |
| NBFC-ND | Does not accept deposits; regulated by RBI; registration in RBI not required |
NBFCs need not maintain SLR/CRR; do not form part of the payment and settlement system; no insurance facility by DICGC for depositors.
Dependence on donor funds; provides banking services to unemployed/low-income individuals or groups without access to financial services.
| Corporation | HQ | Objective |
|---|---|---|
| IFCI (1948) | New Delhi | Medium/long-term finance for industrial establishments |
| State Finance Corporation (1951) | — | Upgrade small and medium enterprises |
| ICICI (1955) | Mumbai | Development of small/medium industries in private sector |
| LIC (1956) | Mumbai | Providing insurance facility |
| IDBI (1964) | Mumbai | Financial assistance to industrial enterprises |
| Union Bank of India (1964) (Axis Bank) | — | Investment in small and medium industries |
| EXIM Bank (1982) | Mumbai | Financial needs of import-export |
| NABARD (1982) | Mumbai | Finance for agriculture and rural development; microfinance fund of ₹100 crore |
| NHB (1988) | New Delhi | Arranging housing-related finance |
| SIDBI (1990) | Lucknow | Facilities for small-scale industries |
| IRDA | Hyderabad | Regulating and licensing insurance industries |
| Assets | Liabilities |
|---|---|
| Bank's deposit with RBI | Demand Deposits (Savings account, Current account) |
| Loans given to people | Fixed Deposit (Fixed, Recurring) |
| Investment in government securities | Loan taken from RBI |
| Investment in share capital | — |
| Topic | Key Fact |
|---|---|
| First Bank in India | Bank of Hindustan, Calcutta (1770) |
| First Indian-owned Bank | Awadh Commercial Bank (1881) |
| First fully Indian-owned Bank | Punjab National Bank (1894) |
| Imperial Bank of India | 1921 → Nationalised 1955 → SBI |
| 14 Banks Nationalised | 19th July 1969 |
| 6 Banks Nationalised | 15th April 1980 (deposits ≥ ₹200 crore) |
| Public Sector Banks | 12 (11 Nationalised + 1 SBI) |
| RBI Established | 1 April 1935 (RBI Act 1934) |
| RBI Nationalised | 1st January 1949 |
| RBI HQ | Mumbai (formerly Calcutta before 1937) |
| First Governor of RBI | Sir Osborne Smith |
| First Indian Governor | C.D. Deshmukh (3rd Governor) |
| Current Governor (26th) | Sanjay Malhotra (from 11 Dec 2024) |
| RRBs Established | 2nd October 1975 (M. Narasimhan Committee) |
| Current RRBs | 28 (May 2025) — works in all states except Goa & Sikkim |
| Total Foreign Banks | 44 (May 2025) |
| Banking Ombudsman | Established 14th June 1995 |
| MUDRA Bank | Commencement 2015 | Shishu/Kishor/Tarun categories |
| SARFAESI Act | 2002 — To deal with wilful defaulters |
| Insolvency & Bankruptcy Code | 2016 — Cases settled within 180 days |
| SLR (Current) | 18% |
| CRR Range | 3–15% |
| Monetary Policy Committee | Formed 24 Sep 2016 (Urjit Patel Committee) | 6 members + 1 Governor |
| Basel Committee | Formed 1974 (10 member countries) |
| NPA (2024) | 2.6% |
| India Post Payments Bank | Started 1 September 2018 |
| Payments Bank — Deposit Limit | ₹2 lakh per customer |