Scheduled commercial banks are those banks which are included in the Schedule II of RBI Act, 1934. Scheduled commercial banks carry out the normal business of banking activities such as accepting deposits, giving loans and other banking services.
Scheduled commercial banks are those which are included in the second schedule of the RBI Act 1934 and which carry out the normal business of banking such as accepting deposits, giving out loans and other banking services. The main difference between scheduled commercial banks and scheduled corporative banks is their holding pattern as co-operatives are registered under the co-operatives society act as co-operative credit institutions.
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Scheduled Commercial Banks can be divided as follows:
These are the banks where more than 50% stake is held by the government. At present there are 27 public sector banks in India including SBI and its associates along with 19 other nationalised banks and other public sector banks such as IDBI and Bhartiya Mahila Bank.
Listed below are the nationalised banks in India that come under the category of scheduled commercial public sector banks:
There are two banks that have been categorised as other public sector banks:
As of now, India has 27 Public Sector Banks. This number includes SBI, its 5 associates and 19 other nationalized banks. Two other banks, namely IDBI and Bhartiya Mahila Bank are two banks which have been categorized by RBI as “Other Public Sector Banks”.
State Bank of India (SBI) is India’s largest bank by assets. It has around 17,000 branches and around 200 foreign offices. It is the banker to millions of Indians and has over 2 Lakh employees. SBI was formed in the British Era. It is the child of three presidency banks, namely, Bank of Calcutta (which was later renamed as Bank of Bengal), Bank of Bombay and the Bank of Madras. In 1921, these three presidency banks were merged and the entity was called as the Imperial Bank of India. After about 35 years, in 1955, the Imperial Bank of India was nationalized and renamed as the State Bank of India. This makes SBI the oldest Bank in India.
In 1959, SBI had 8 associate banks. Currently, it has 5 associate banks. They are:
In addition to the above, SBI also has 7 non-banking subsidiaries. They are SBI Capital Markets Ltd., SBI Funds Management Pvt. Ltd., SBI Factors & Commercial Services Pvt. Ltd, SBI Cards & Payments Services Pvt. Ltd. (SBICPSL), SBI DFHI Ltd, SBI Life Insurance Company Limited and SBI General Insurance.
Although SBI comes under the definition of a nationalized bank, RBI puts State Bank of India and its 5 associate banks under a separate category ‘SBI & Associates’).
Private sector banks are those whose majority stake is in private hands. Indian has two types of private sector banks:
There are 12 old private sector banks:
Of the above banks, Nainital Bank is a subsidiary of the Bank of Baroda. 98.57% stake in Nainital Bank is held by Bank of Baroda. There were also other old private sector banks which have now merged with other banks. For instance:
In 1993, RBI issued revised guidelines regarding the entry of private sector banks. Therefore, new private sector banks are the ones which were incorporated as per such revised guidelines. Currently, there are 7 new private sector banks:
RBI policy towards the presence of foreign banks in India is based on two cardinal principles viz. reciprocity and single mode of presence. As of now, there are 45 foreign banks which are operating as branches in India. They are as follows:
As of now, there are 45 foreign banks which are operating as branches in India.
The cooperative bank is also regulated by the RBI. They are governed by the banking regulations act 1949 and banking laws (Co-operative Societies) act, 1965. These banks provide most services such as savings and current accounts, safety deposit lockers, loan or mortgages to private and business customers.
Regional Rural Banks were started in the 1970s as even after nationalization, there were cultural issues which made it difficult for commercial banks to lend money to farmers. The regional rural banks (RRBs) are as follows:
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