Banking Sector in India today
Banking Sector in India
History, Evolution, Opportunities & Challenges
Submitted by
Mayank Kishore B039
Vivek Manjarekar B041
Anshu Kumar Sinha B064
Table of Contents
Evolutionary Phase 3
Foundation Phase 3
Nationalization of Banks 4
Effect of nationalization 5
Reformatory Phase 5
First generation reforms 5
Impact of first generation reforms 6
Second generation reforms 7
Review of second generation reforms 10
Opportunities & Challenges 11
New banking licenses & key guidelines 11
Banking Sector in India- History, Evolution, Opportunities & Challenges
In order to understand structure of banking sector in India and its evolution over the decades, it is necessary to look at its development in a somewhat larger historical perspective. The last six decades and particularly the last two decades (post 1991) have witnessed seismic change in the nature of commercial banking.
In over five decades since dependence, banking system in India has passed through four distinct phase, viz.
(1) Evolutionary Phase (prior to 1950)
(2) Foundation phase (1950-1968)
(3)Nationalization: Expansion & Consolidation phase (1969-1990)
(4) Reformatory phase (since 1991)
Evolutionary Phase (prior to 1950)
From 1901-1914, 12 banks were established, among which were the Bank of Baroda in 1906, Canara Bank in 1906, Indian Bank in 1907, Bank of India in 1908 and Central Bank of India in 1911. During the First World War in 1914, the Indian Bank faced many serious crises. Also several banks succumbed to these crises. No commercial bank was established during this period. In 1921 need was felt to have a State Bank with all support and resources of the Government with a view to help industries and banking facilities to grow in all parts of the country. To accomplish this objective the three Presidency Banks were amalgamated to form the Imperial Bank of India. The role of the Imperial Bank was to extend banking facilities and to render the money resources more accessible to the
History, Evolution, Opportunities & Challenges
Submitted by
Mayank Kishore B039
Vivek Manjarekar B041
Anshu Kumar Sinha B064
Table of Contents
Evolutionary Phase 3
Foundation Phase 3
Nationalization of Banks 4
Effect of nationalization 5
Reformatory Phase 5
First generation reforms 5
Impact of first generation reforms 6
Second generation reforms 7
Review of second generation reforms 10
Opportunities & Challenges 11
New banking licenses & key guidelines 11
Banking Sector in India- History, Evolution, Opportunities & Challenges
In order to understand structure of banking sector in India and its evolution over the decades, it is necessary to look at its development in a somewhat larger historical perspective. The last six decades and particularly the last two decades (post 1991) have witnessed seismic change in the nature of commercial banking.
In over five decades since dependence, banking system in India has passed through four distinct phase, viz.
(1) Evolutionary Phase (prior to 1950)
(2) Foundation phase (1950-1968)
(3)Nationalization: Expansion & Consolidation phase (1969-1990)
(4) Reformatory phase (since 1991)
Evolutionary Phase (prior to 1950)
From 1901-1914, 12 banks were established, among which were the Bank of Baroda in 1906, Canara Bank in 1906, Indian Bank in 1907, Bank of India in 1908 and Central Bank of India in 1911. During the First World War in 1914, the Indian Bank faced many serious crises. Also several banks succumbed to these crises. No commercial bank was established during this period. In 1921 need was felt to have a State Bank with all support and resources of the Government with a view to help industries and banking facilities to grow in all parts of the country. To accomplish this objective the three Presidency Banks were amalgamated to form the Imperial Bank of India. The role of the Imperial Bank was to extend banking facilities and to render the money resources more accessible to the