Origin and growth of commercial banks in india

* According to the EY 2021 NextWave Global Consumer Banking Survey explored consumers’ primary financial relationships and found that FinTechs and neobanks are gaining ground. * That demand seems particularly strong when it comes to the critical need of protecting consumer data, where incumbent banks have a trust advantage. Some super apps may also turn to banks for access to banking licenses and to meet other regulatory requirements. * In the recent period, technological innovations have led to marked improvements in efficiency, productivity, quality, inclusion and competitiveness in extension of financial services, especially in the area of digital lending. * Digitalization of Agri-finance was conceptualized jointly by the Reserve Bank and the Reserve Bank Innovation Hub (RBIH). This will enable delivery of Kisan Credit Card (KCC) loans in a fully digital and hassle-free manner. All material, information, data, images or content on this website is subject to copyright or other applicable intellectual property laws and no part of it can be reproduced in any form (including paper or electronic form) without prior written consent and approval from IBEF. Infringements are subject to prosecution under the applicable laws. For consent related queries and conditions, please write to [email protected]

History of Banking History of banking in India has many evidences that banking system was in practice of human beings since prehistoric age. Study of banking system in India reveals the story of evolution of banking in India. A vast chronicle of Indian banking history describes that people was banking on concept of barter system. In trade, Barter system is a system of exchange of goods and services in opposition of other goods and services. Barter system depends on double coincidence of wants, in which both participants do direct trade as per their needs. Barter for the exchange to occur, people started to keep record of need, requirements of other people and started to keep stock of particular goods like salt, metal etc. As per barter system, ancient type of money was grain money, food money, cattle money. Barter system had limitations like difficulty in identifying the coincidence bilateral / multilateral wants, there was not any standard unit for valuation, Lack of universal standards, lack of resources. Such limitations in barter system automatically forced the economy towards monetary system. Now banking system transformed from barter system to monetary system. Definition of Bank The word “bank” comes from Italian word banca. Banca means “bench, counter, and table”. In ancient age merchants of the world, who used to give grain loans to farmers and traders who carried goods between cities, were used to do banking on benches. Italy was the country who gave the name “Ban...

The banking sector in India plays a vital role in this country’s economic development. Over the centuries, numerous changes have taken place within this industry, starting from technological advancement to the diversification of financial services and products. Currently, the Indian banking system includes commercial banks, small finance banks, and co-operative banks. Banks operating within the boundaries of India abide by the Banking Regulation Act, 1949. Let’s understand India’s banking system in three phases. Phase 1 (1786-1969) This is the pre-independence phase which lasted nearly 200 years. During this period, there were close to 600 banks. At the same time some of the major developments for the banking industry also took place. Bank of Hindustan, is the first bank to come into existence, and it marked the foundation of India’s banking system. But it ceased to exist in 1932. Presidency banks The East India company founded three key presidency banks. These include Bank of Bombay (1840), Bank of Madras (1843) and Bank of Calcutta (1806). These three banks merged together and became the Imperial Bank of India. In 1955, it was renamed to the State Bank of India. Besides these, more banks, including Punjab National Bank and Allahabad Bank, came into existence. Between 1913 and 1948, there was a stagnation in India’s banking space as growth was slow. Multiple banks encountered periodic failures. The lack of confidence in the country’s banking system played a part in the sl...

DEVELOPMENT OF COMMERCIAL BANKING 1950–1990 DEVELOPMENT OF COMMERCIAL BANKING 1950–1990 When India attained independence in 1947, it inherited a weak and unwieldy banking structure. The rudimentary nature of the legal framework had allowed the haphazard growth of indigenous banking institutions, with the number of banks mushrooming in some periods, followed by sizable numbers of bank failures, especially during The stresses and strains faced by the Indian banking system during the immediate postwar years were compounded by the postpartition travails, particularly in The subject of the inadequacy of banking laws had received probing attention in the report of the Central Banking Enquiry Committee (1931), which recommended a full-fledged bank act, but this could be implemented only with the passage of a regular Banking Companies Act (1949). After these early steps, the Indian banking system experienced far-reaching changes in the post-1950 period. These changes have been primarily influenced by public policies that evolved over different phases, which may be broadly described as: consolidation of banking and strengthening of banking regulations (1950–1967); credit initiatives and social control over banking (1955–1967); bank nationalization and significant structural and institutional changes (1969–1990); and the current period of banking reforms (1991 onward). Banking Consolidation The task of consolidation and strengthening of the banking system, which the Reserve Bank of ...

Overview 6 • Premium Statistic Number of banks in India 2022, by type • Premium Statistic Value of bank assets in India FY 2013-2022 • Premium Statistic Reserves to debt ratio in India FY 2015-2022 • Premium Statistic Gross non-performing loan ratio SCBs India FY 2008-2021, with estimates for FY 2022 • Premium Statistic Value of foreign exchange reserves in India FY 2010-2021 • Premium Statistic Financial conditions index India Q4 FY 2022, by category Gross non-performing loan ratio SCBs India FY 2008-2021, with estimates for FY 2022 Gross non-performing loan ratio of scheduled commercial banks across India from financial year 2008 to 2021, with estimates until September 2022 • Premium Statistic Value of foreign exchange reserves in India FY 2010-2021 Sectors 7 • Premium Statistic Distribution of number of banks in India FY 2020, by sector • Basic Statistic Public sector bank assets in India FY 2013-2022 • Basic Statistic Private sector bank assets in India FY 2013-2022 • Basic Statistic Assets of foreign banks in India FY 2013-2022 • Basic Statistic Loan to deposit ratio of public sector banks in India FY 2012-2022 • Premium Statistic Loan to deposit ratio of private sector banks in India FY 2017-2022 • Premium Statistic Loan to deposit ratio of foreign sector banks in India FY 2019-2021 Key players 7 • Premium Statistic Leading public sector banks in India 2022, by market cap • Premium Statistic Leading private sector banks in India 2022, by market cap • Premium Statisti...