You are on page 1of 1

In India as we know the apex body for the banking sector is RBI-(Reserve Bank of India), which was formed

in the year 1935. But it was nationalized on 1st January 1949 bring all the banks under its regime, and the banking regulation was passed. Giving RBI the power to regulate and control the banks in India, and this act was also said that no two banks should have the same director. Also the existing banks or the new banks could open a branch without the permission of RBI. In India out of the total assets under the banking sector around 70% of it is under the public sector bank where as the remaining is under the private sector banks. Also as we see during the tenure of Congress government under the leadership of our late prime minister Indira Gandhi, who had nationalized 14 banks on 19th July 1969 bringing the major banks under one roof, and thus improving the service of the banking sector. Also in the year 1980, six more commercial banks joined in thus improving the service of the banking sector in India. But the main turning point in the game was in the year 1991 during liberalization when the government approved the license of small banks as well as allowed FDI in banking sector this increased the competition in the market as the consumers now had more options and also the interest and the other services given by them were more then the public sector bank, this created a major challenge as the consumers now had options and could switch on easily. But when we look towards the statistics we see that the total banking sector has the asset value of Rs 82,99,220 crore (US $ 1564.8 bn) also in a decade the revenues of the banking sector was $ 46.9 bn . Also when we have a look at the individual banks the highest assets under the banks are owened by SBI (Rs 7,567 bn) followed by Punjab National Bank (Rs 2421 bn), also the growth for the banking sector was majorly because of the reforms brought in by RBI but the few current reforms include, deregulating the saving accounts interest rate where in RBI has removed the cap of interest on saving account, as it would help banks to attract more funds and also people would not hold back cash, also there is now a relaxation on the bank branch policy where in banks can now open branches in the cities having population more 50,000 to 99,999 without the approval of RBI. Also the latest trend of the mobile banking which first has a cap of transaction of only Rs 50,000 but the cap has been removed and RBI has told banks to make their limits keeping in mind the risk factor associated with it, where as RBI used to issue license to few private institution but now it has eased the norms and offers license to institutions who ever fulfill the banking norms. Also the finance minister has said that village with a population with more than 2000 will have a bank branch so as to spread the availibility of financial system to each and every part of India.

You might also like