bank vs nbfi
TRANSCRIPT
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Financial intermediariesClassifcation: Bank vs NB
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P S L r u l e a p p l i e s M S F g i v e n
N O P S L
N O
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Commercial
CRR, SLR: yes yes
Cooperati
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Commercial
PSL: yes PSL: Nope
Cooperati
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Commercial
Proft motive No proft no
motive
Cooperati
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Commercial
Voting poeras per
s!are!olding
" person "
Cooperati
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Commercial #anksP$#lic sector: %% & %' (P) Nayak *%+"-
i#a.org.in/viemem#anks.asp0id1"
Private sector: %2i#a.org.in/viemem#anks.asp0id12
Foreign #anks: "
i#a.org.in/viemem#anks.asp0id1
F3I (in Indian #anks-1 45 a$tomatic & '5 Fapproval
F3I (6oreign #anks-1 "++5 i6 !olly oned s$
http://www.iba.org.in/viewmembanks.asp?id=1http://www.iba.org.in/viewmembanks.asp?id=3http://www.iba.org.in/viewmembanks.asp?id=4http://www.iba.org.in/viewmembanks.asp?id=4http://www.iba.org.in/viewmembanks.asp?id=4http://www.iba.org.in/viewmembanks.asp?id=4http://www.iba.org.in/viewmembanks.asp?id=3http://www.iba.org.in/viewmembanks.asp?id=3http://www.iba.org.in/viewmembanks.asp?id=3http://www.iba.org.in/viewmembanks.asp?id=1http://www.iba.org.in/viewmembanks.asp?id=1http://www.iba.org.in/viewmembanks.asp?id=1
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Narsim!an:17y#rid (Comm.Bank 8 Coop. soc.-
9!e Sponsor #ank: 7R, 9raining
;ll India 6e district
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st
9!is isan RRB 9!is is its
Sponsor
#ank
Payment @ateay
C
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Pr
".?r#aniation 1 Private#anks, SCB
%.3epositD lo> N;B;R3depend.
2.3e#t Eaiver 1NP;
.Sol$tion : ;malgation %++AG
C
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;lloedHem to raise morecapital
@ave e=i#ility tos!are!olding
Imposed term limits ondirectors
!ttp://mr$nal.org/%+"/"%/#ankingDrr#DamendmentD#illDregionalDr$ral
D#anks.!tml
;m
http://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.htmlhttp://mrunal.org/2014/12/banking-rrb-amendment-bill-regional-rural-banks.html
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P S L , M S F
4 0 % | 3 2 %
D e p e n d i n g o n
B r a n c e s
S ! i6 0
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3esi (8Foreign %+- Foreign #ank
Remaining KK to RI3F 9o S3F
R$ral in6ra.3evelopment 6$nd small enterpridevelopment 6N;B;R3 manages SI3BI manag
N;B;R3 pays interest to
#ank
Same #y SI3
State governmentsget in6ra. Loan
Similar case: sind$strial fn.c
PSL: E!at i6 targets not met0
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State registrar:Cooperative society.
HMM: Banking reg$lation;ct.
NoDproft, noDloss>
one mem#er one vote.
;ll India0 No
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SLR, CRR yes.
PSL: no. (only
Sc!.coom.B-Pro#lems
politiciation,Scandals: ad!$p$ra:etan Parek!,
Visnagar/al$p$r: NP;
Fe
B
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".?r#an (omen-
%.R$ral
".State CooperativeBanks
%.3istrict: Central Cooperative #anks
2.Village: P;CS.Land Development Bank:
ClaB
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; l l I n d i
a f
i n s t i t $
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". =portDImport Bank o6India
%. loan/credit/fnance toe=porters and importers.
2. promotes cross #order
trade and investment. Boss: @overnment o6
India ("++5-
Q
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; l l I n d i
a f
i n s t i t $
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National Bank 6or ;gric$lt$re andR$ral 3evelopment
BOSS: @oI (44.25- 8 RBI (+.'5-
reg$latory a$t!ority: Coop 8 RRBR$ral in6ra. 3evelopment 6$nd(RIF3- i6 PSL not met
7elps State cooperative #anks(SCB-, (RRBs-, FI, cooperative societies etc.
6armers, Cottage/!andicra6t, (S7@-
N
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; l l I n d i
a f
i n s t i t $
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National 7o$sing Bank
Boss: RBI ("++5-
ape= instit$tion 6or !o$singfnance in India
Finance to #anks and NBFCs 6or!o$sing proects
RSI3Q inde= (!o$sing sectorDination-
N
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; l l I n d
i a f
i n s t i t $
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Small ind$stries development#ank o6 India
BOSS: SBI, LIC, I3BI ot!er p$#lic
sector #anks, ins$rance companiesetc.
SI3BITs S3F1 small enterprises
development 6$nd. (Foreign #anksill J%+ #ranc!es, PSL-
S sector, fnance to StateInd$strial 3evelopment
Corporation (SI3C-, State fnance
S
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Fi6t! FI 1 Ind$strial InvestmentBank o6 India (IIBI-
Closed in %+"%
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3FI/3B> @onea6ter Narsim!an II "44
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P S L r u l e a p p l i e s
ock U$estion %++' (?PSC-
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" Skip % ;ttempt
9!e national !o$sing #ank (N7B- aset$p in India as a !olly oned
s$#sidiary o6 !ic! o6 t!e 6olloing
;.State #ank o6 India
B.Reserve Bank o6 India
C.ICICI
3.LIC
ock U$estion %++' (?PSC-
ock U$estion %++D fnd corre
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" Skip % ;ttempt
;.N7B, t!e ape= instit$tion o6 !o$singfnance in India, as set$p as a !o
oned s$#sidiary o6 RBIB.Small ind$stries development #ank o
India as esta#lis!ed as a !olly os$#sidiary o6 t!e Ind$strial developm#ank o6 India
C.Bot! ; and B
3.Neit!er ; nor B
ock U$estion %++D fnd corre
ock U$estion %++D fnd corre
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" Skip % ;ttempt
Find Correct Statement(s-
;.(RIGHT- N7B, t!e ape= instit$tion o6 !o$s
fnance in India, as set$p as a !olly ons$#sidiary o6 RBI
B.(ERON@- Small ind$stries development #aIndia as esta#lis!ed as a !olly oned
s$#sidiary o6 t!e Ind$strial development #India
C.Bot! ; and B
3.Neit!er ; nor B
ock U$estion %++ fnd corre
ock U$estion
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E!ic! o6 t!e 6olloing grant(s- direct credit assito r$ral !o$se!olds0 (%+"2-
".RRB%.N;B;R3
2.Land development Banks
Choice:
;.Only " and %B.Only %
C.Only " and 2
3.", % and 2.
ock U$estion
ock U$estion CS;9 %+"2
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" Skip % ;ttempt
E!ic! o6 t!e 6olloing grant(s- direct credit assito r$ral !o$se!olds0
".RRB%.N;B;R3
2.Land development Banks
Choice:
;.Only " and %B.Only %.
C.Only " and 2
3.", % and 2.
ock U$estion CS;9 %+"2
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! " B i l l
Fres #"Sec
Fres securi$ies
Sor$ $er% Long $
Securi$ies resold
ere
" deal in primary market N
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". deal in primary market.directly #$y @Dsec via a$ction.
%. Can Participate in OO
2. $st get license 6rom RBI.
. organ Stanley , @oldmanSac!s, )P organ C!ase,
Standard C!artered Bank, 7SBC(7ongkong and S!ang!aiBanking Corpn. Ltd-
A. ven: SBI, BoB, otak a!indra
etc
P3
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NBFI: 9ype W2 NBFC
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yp
NBFI: 9ype W2 NBFC1 Not Ban
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Bank NonDBanking FinancialCompany
RBI gave t!em license$nder Bankingreg$lation ;ct.
No. 9!ey take license $nderCompany ;ct.
;ll s$pervised #y RBI. NO9 all. e.g. Ins$rance cos1IR3;erc!ant Banking Cos.1SBI.
deposit 6rom p$#lic". time deposit(F3R3-
%. demand deposits(C;S;-
• 9!ey can accept 9ime depos(s$c! NBFC are called 3epotaking NBFC-
• B$t 9!ey cannot accept demdeposits.
• Not part o6 Payment settlem
C9S.
yp
Bank NBFC
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Bank
RBI gave t!emlicense $nderBanking reg$lation;ct.
Registered $ndCompanies ;c
NBFC
Bank NBFC
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Bank
RBI s$pervisest!em all.
3ependsIR3;: Ins$ranc
erc!ant BanSBI
icrofnance:State8RBI
NBFC
Bank
NBFC
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Bank
deposit 6rom p$#lic
time deposit(F3R3-
demand deposits(C;S;-
9!ey can acce 9ime deposit.
NBFC are calle3eposit takingNBFC-
B$t 9!ey cann
accept demandeposits (C;S;
Not part o6 Paysettlement, C9
NBFC
Bank NBFC
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Bank
5 CRR,%%5 SLR
No.Only 3eposit tNBFC. "A5 SL
C
Bank NBFC
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Bank
PSL: +5 & 2%5 PSL doesnHt ap
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Bank NBFC
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Bank lendsdeposited moneyto someone.
B$t cannot investin s!aremarket
9!ey also lend
money to som(1FinanceCompanies-
C;N invest in
s!aremarket. F, PF, Ins$raCos.
Bank NBFC
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Loan rateslinked it!Base Rate
system
3epends•
@old Loans1 r6actor ("A5, %•Not all directly•S!ares: divide
9CS , Coal In%4.•Bonds: /"%/"
Bank NBFC
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S;RF;SI:loan recovery
poers
S;RF;SI On
6or 7o$singfnance comp• @old loan:a$ction
• Bonds: frst• S!ares: last
NBFIYNBFCY So$rce o6 6$nd0
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".From clients: ins$rance, m$t$al 6$n
%.Borro 6rom #anks
2.@et fnance 6rom N;B;R3, Nationa7o$sing #ank, SI3BI etc ape=instit$tions
.Can iss$e o6 #ondsA.Very 6e permitted =ternal Comm
Borroing (CB-
%+"+: Find correct statement
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". Skip %. ;ttempt
". 9!ey cannot engage in t!e acX$isition osec$rities iss$ed #y government.
%. 9!ey cannot accept demand deposits liksavings acco$nt.
Find Correct statement(s-0
;.Only "
B.Only %C.Bot! " and %
3.Neit!er " nor %
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ock U$estion (%+"+-
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". Skip %. ;ttempt
Eit! re6erence to Non #anking fnancial companies(NBFCs- in India, Consider 6olloing statements
". 9!ey cannot engage in t!e acX$isition o6 sec$riti
iss$ed #y government.
%. 9!ey cannot accept demand deposits like savingacco$nt.
Find Correct statement(s-0
;.Only "B.Only %
C.Bot! " and %
3.Neit!er " nor %
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&lassi'ica$ion
NBFI→NBFC→Classification
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9ype W" Reg$lated #y RBI
;sset FinanceCompany(;FC-
• loan to #$y economically prod$ctive assets e
tr$ck, tractor, p$mpset, #$lldoer, eart!move• %+"2: K%++mn CB, a$tomatic indo.• SRI X$ipment Finance (E7I9 L;BL ;9-
In6rastr$ct$reFinance
Company
• @ives loan 6or in6ra. Proects. (I3FC got separa#ank license-
• R$ral lectrifcation Company (RC-• Raiv @and!i @ramin Vid!y$tikaran (Poer i• Rs.2,A++ crore t!ro$g! ta=D6ree #onds.
In6rastr$ct$re3e#t F$nd(I3FDNBFC-
)$st like a#ove, #$t t!ey give very long term loaCan even raise money 6rom a#road.
Core InvestmNBFIYNBFCYRBI controlled
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Investment Cos
Invest in sec$rities
$t!oot fnance
LZ9 fnance.
Same. 9!ey too sec$rities
Investment long(spec$lative, aa=-
;ccept p$#lic 6$
(NBFCD3.-Cannot enter in
.g. 9ata CapitaCapital
Core InvestmCos
NBFIYNBFCYRBI controlled
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LoanCompany
• $t!oot gold loan,annap$ram @old
• L9V.FactorCompany
• Factoring #$siness• 7SBC
isc. C!itF$nd•RBI 8 Registrar o6 C!it 6$n
Resid$ary • DD
NBFIYNBFCYClassifcation
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RBI re!"lated
;FCIn6ra. Finance
I3F
Investment Co.
Core investment
Loan Company
Factor Company
C!it F$nd, isc.
Other than
9 k i LIC B ;lli
NBFIYNBFCYClassifcation (not reg$l
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Ins$rance
companies
9ake premi$m6rom yo$,invest It in
s!ares/#onds.
LIC, Baa ;llian
I
7o$sing
FinanceCompanies
9!ey arrangemoney 6rom
variety o6so$rces, lend itto !omeDloanseekers
37FL, $t!oot7o$sing fnance
etc. N
9!ey !elp
#$ying selling
".India#$lls
% S!erk!an
NBFIYNBFCYClassifcation (not reg$late
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InvestmentBanks(?Sterm-
erger,acX$isition,Eealt!anagement>erc!ant Banker:?nderriting
otak a!indra,Citigro$p,Bank o6;merica
S
erc!ant
BankingCompanies(?
term-
?nderriting,Corporateadvising, 9!eylend money tocompany via#$ying itss!ares
3SP errill Lync!,organ Stanley,Canara Bank, SBIcapital (separatelicense- S
NBFIYNBFCYClassifcation (not reg$late
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Nid!i
One type o6Tcl$#T. Borromoney 6rom
mem#ers, lendit among t!emem#ers.m$t$al #eneft6$nds
SO?97;3R;S
BNFI9 F?N3ltd.
3epartmt o6Compan
a[airs
icrofnance
companie
s
NonDBankingFinancialCompany Dicro FinanceInstit$tion(NBFCDFI-
".SS(;nd!ra-,
%.Cas!por(?P-,
2.?ivan
3epartmt o6Compana[airs
3 6 [ i
NBFIYNBFCYFI
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3epartment o6 company a[airs.
ntry capital A cr.
Individ$al person not given loan a#oveRs.A++++
Foc$s on poor people, omen clients, S7@
Loan it!o$t collateral.
Borroer given e=i#ility to decide I anrepayment
;ct$al interest rate: %M5
SS (;nd!ra-, Cas!por (?P-, ?ivan (arn
3?RIN@ i S (C! A FI-
Pending
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3?RIN@ conomic S$rvey (C!.A FI-
P ) Nayak CommitteeD re6orms in p$#
sector #ank oners!ipBi6$rcation o6 C3 posts in PSB
B;SL norms
Ins$rance amendment