Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 11 Types of Banks Notes
→ According to Banking Regulation Act 1949, “Banking means the accepting for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdrawable by cheque, draft, pay order or otherwise”.
→ There are different types of banks performing different sets of functions.
→ Banks which accept deposits from the public and grant loans to traders, individuals, agriculture, industries, transport, etc. in order to earn profit.
→ Huge finance required for investment, expansion and modernisation of big industries and others are granted by a separate type of banks called development Banks. They are also called industrial banks.
→ All cooperative banks in India are owned by its customers or members who are farmers, small traders and others.
→ National Cooperative Development Corporation (NCDC) established in 1963 is providing loans and grants to State Governments for financing cooperative societies.
→ In 1920, first Land Mortgage Bank (LMB) was established in India.
→ First Cooperative Societies Act was passed in 1961 by Tamil Nadu Government.
→ Primary Agricultural Credit Societies (92,789 – refer chart) in India do not carry the name banks and they are not recognised by the RBI as banks.
→ Banks which have registered office in a foreign country and branches in India are called foreign banks.
→ The RRBs were formed under the Regional Rural Bank Act 1976, jointly by the Central Government, State Government, and a sponsor bank.
→ EXIM Bank provides finance for import of technology, export product development, pre-shipment and post-shipment and overseas investment.
→ Local Area Bank (LAB) scheme was introduced by the RBI in August 1996.
→ Small Finance Banks (SFBs) are private sector banks set up in unbanked and underbanked regions of the country to achieve financial inclusion.
→ In September 2015, RBI granted provisional licenses to 8 Non-Banking Finance Companies (NBFCs) already engaged in microfinance to be converted into SFBs and 2 others.
→ Payment banks are formed to widen the spread of payment and financial services to small businesses, low-income households, and migrant labourers.
→ A Multilateral Development Bank is formed by the Governments of a group of countries.
→ All banks which satisfied the norms and included in the Second Schedule to the RBI Act, 1934 are called scheduled banks.
→ Any bank in which not less than 51 percent of shares are owned by the Government are called Government banks or public sector commercial banks.
→ In 1969, Government of India nationalised 14 private banks.