Download - History and Development of Banks
HISTORY AND DEVELOPMENT OF BANKS IN INDIA
Bulomine Regi.SAsst. Prof. of Business Administration,St. Xavier’s College (Autonomous),Palayamkottai-627002Email id: [email protected]
HISTORY
AND
DEVELOPMENT
OF
BANKS IN IN
DIA
STAGES IN HISTORY OF BANKING IN INDIA
History of Banking has been divided intoStages like:• Pre-independence stage• Post Independence stage• Nationalisation of Banks• Introduction of Financial Sector Reforms• IT revolution in Banks
History of Banking in IndiaPhase- I ( Early Phases from1786-1969 of
Indian Banks)Phase- II (1949 Nationalisation of
IndianBanks and upto 1991 prior to Indian Banking Sector Reforms)
Phase-III (New Phase of Indian Banking System with the advent of Indian Financial and Banking Sector Reforms after 1991)
PHASE- I
(EARLY PHASES FROM 1786-1969 OF INDIAN BANKS)
In the mid of 19 century East India Company
IMPERIAL BANK OF INDIA(1920)
Bank of Bengal(1809)
Presidency Banks
Later in
1865 Allahabad Bank1894 Punjab National Bank
1906-1913 Bank of India, Central Bank of
India, Bank of Baroda, Canara
Bank, Indian Bank, Bank of Mysore
1935 RESERVE BANK OF INDIA
During First Phase• The growth of banks was very slow.• Banks experienced periodic failures
between 1913-1948.• 1100 Banks (Approx.) mostly small.• To streamline that the Government of
India came up with THE BANKING COMPANIES ACT,1949.
THE BANKING COMPANIES ACT, 1949
BANKING REGULATION ACT,1949(as per amending Act of 1965- Act
No. 23 of 1965)
RBI was vested with extensive powers for the supervision of banking in India as the Central Banking Authority.
PHASE- II
(1949 Nationalisation of IndianBanks and upto 1991 prior
to Indian Banking Sector Reforms)
After Independence,
Imperial BankState Bank India Act,
1955
State Bank of India
1949 ---- Banking Regulation Act1955 ---- Nationalisation of SBI1959 ---- Nationalisation of SBI subsidiaries
(7 Banks)1961---- Insurance cover extended to
deposits1969 ---- Nationalisation of 14 major Banks1971---- Credit Guarantee Corporation1975 ---- Regional Rural Banks1980 ---- Six Banks with deposits over 200
crores were nationalised
PHASE- III
(New Phase of Indian Banking System with the advent of Indian
Financial and Banking Sector Reforms after 1991)
In 1991 Government opened the gate of
Liberalisation of banking practices as per the report of a banking committee set up under the chairmanship of Mr.M.Narasimham
(Narasimham Committee for the development and growth of the Indian
Banking System)
In 1993
• The Government merged New Bank of India with Punjab National Bank.
• It was the only merger between nationalised banks and resulted in the reduction of the number of nationalised banks from 20 (14+6= 20) to 19.
Till nowBanking industry has changed
tremendously with retail banking shifting to universal banking.
The country is flooded with foreign banks.ATM, Phone Banking, Internet Banking
etc., was introduced.The entire banking system became more
convenient and swift.The financial system of India shown a
great deal during this phase.