International Journal of Multidisciplinary Research and Development

International Journal of Multidisciplinary Research and Development

Online ISSN: 2349-4182, Print ISSN: 2349-5979, Impact Factor: RJIF 5.72
www.allsubjectjournal.com
Volume 4; Issue 6; June 2017; Page No. 366-368

A study of Indian banking sector

Pooja Antil, Prerna Antil, Kamal Aggarwal
Department of Commerce, SRM University, Sonipat, Haryana, India

Abstract
Finance and banking is the life blood of trade, Commerce and industry. Now-a-days, banking sector acts as the backbone of
modern business. Banking industry is a piece of the economy in the world. The Indian financial sector underwent a sweeping
change during the nineties. The banking sector in India has come upon a speedy transformation. As banks rely increasing on
information technology and the internet to carry on their work and interact with the market, technology risk will increase, both for
the financial industry at large and individual banks. Bank plays an important role in the economic development of developing
countries. The banking system in India is dominated by nationalized banks. The banking is one of the most important parts of the
human life. This research paper totally focused on growth of Indian banking sector and it’s totally focused on performance of
Indian banks.

Keywords: banking sector, Indian economy, financial sector

Introduction History of Banking Industry

Banks receive deposits from public and also borrow money a) History of Banking has been divided into Stages like:
from other sources for increasing working capital funds. They  Pre-independence stage
have to pay cost by way of interest on the funds raised. The  Post Independence stage
symptoms of the banking activities are found from Vedic era  Nationalization of Banks
to till date. Indian banking sector has undergone rapidly major  Introduction of Financial Sector Reforms
changes during the period. These changes not only functioning  IT revolution in Banks
of the banks but it also impacted highly on the efficiency, b) There were three oldest Banks:
effectiveness and the productivity of all the Indian banks.  Bank of Bengal
Banking sector is treated as to be the back bone of the  Bank of Bombay
economy. A bank is a financial institution that provides  Bank of Madras
banking and other financial services to their customers. A These banks were called Presidency Banks. They merged in
banking system also referred as a system provided by the bank 1925 to form the Imperial Bank of India, which after
which offer cash management services for customers, independence became State Bank of India. Reserve Bank of
reporting the transactions of their accounts and portfolios, India came into existence in 1935 which took the
throughout the day. responsibility of regulating Banking sector as Central Bank in
India. The Indian banking sector is distinctive from the rest of
Banking Structure in India the world’s banking system because of the distinctive
Banking which are integrated in the 2nd phase of the RBI are geographic, social and economic characteristics of the country.
called schedule banks. These banks comprise into two banks, India had 20 banks within the top 1000 out of which only 7
which are known as Scheduled Co-operative banks and were within the top 500 banks.
Scheduled Commercial banks. There are 13 types of banks
available in India. Table 1: The table below depicts the evolution of the banks
These are following banks: Sr. Starting
 Central banks No
Name of Bank
Year
 Investment banks 1 General Bank of India 1786
 Merchant banks 2 Bank of Bombay 1840
 Savings banks 3 Bank of Madras 1843
 Offshore banks 4 Allahabad Bank 1865
 Commercial banks 5 Punjab National Bank 1894
 Retail banks 6
Bank of India, Central Bank of India, Bank of 1906 to
 Universal banks Baroda, Indian Bank, Bank of Mysore 1913
 Public sector banks 7 Reserve Bank of India 1935
 Private sector banks
 Foreign banks Objective of the Study
 Co-operative banks 1. To study the Indian banking sector and performance of
 Development bank Indian banks.

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2. To understand the significance of banks in India. Data Collection Method

In this research paper we used two types of data.
Importance or Need of the Study
Before the establishment of banks, the financial activities were a) Primary Data
handled by money lenders and individuals. The organized Primary data is also known as first hand data which is
banking sector works with in the financial system to provide collected by researcher. The main tools which used collected
loans, accept deposits and provide other services to their the data was investigation and observation.
customers.
Following functions of the bank explain the need of the bank: b) Secondary Data
1. To control the supply of money and credit. Secondary data which has already been collected by someone
2. To provide the security to the savings of customers. else not researcher itself. It provides reliable, suitable,
3. To decide equal norms and conditions to all types of adequate and specific knowledge.
customers.
Nationalised Banks in India
Research Methodology Nationalised banks dominate the banking system in India. The
This paper is the outcome of a secondary data on Indian history of nationalised banks in India dates back to mid-20th
banking sector with special reference to Indian context. To century, when Imperial Bank of India was nationalised (under
complete this paper we focus various journals, books, papers the SBI Act of 1955) and re-christened as State Bank of India
(SBI) in July 1955. Then on 19th July 1960, its seven
and periodicals have been consulted and internet searching has
subsidiaries were also nationalised with deposits over 200
also been done. The research methodology not only talks crores. These subsidiaries of SBI were State Bank of Bikaner
about the research methods but also consider the logic behind and Jaipur (SBBJ), State Bank of Hyderabad (SBH), State
the method used in the context of the research study. Research Bank of Indore (SBIR), State Bank of Mysore (SBM), State
methodology is a way to systematically study and solve the all Bank of Patiala (SBP), State Bank of Saurashtra (SBS), and
the problem of research. State Bank of Travancore (SBT)

Private Banks in India

Conclusions to banking sector because of the money market has always

Today the banking sector in India is fairly mature in terms of down.
supply, product range and reach. The world economy
witnessed that a large number of banks have been failed. In Limitations of the Study
this government of India play a vital role through 1. It’s very difficult in data collection.
implementation of the recommendations made by various 2. It’s very difficult to conduct any study or research work.
committees? The role of banks is not only directly important, 3. Branch manager was not giving financial data of the bank.
but also it is very needful in the precise conduct of the 4. Very few knowledge about the bank in the initial stages.
programs projected by government. So that it may
revolutionize in the provision of loans from time to time. A References
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sector researcher found that different problems are increasing 3. Reserve Bank of India Report of the Working, 2010.
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4. Alpesh Shah. Indian banking 2020: Making the Decade’s

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11. www.banknetindia.com/banking/boverview.htm

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