Topics covered (18)

1. History of Banking in India: Detailed Phases — Phase 1: Pre-Independence (1770-1947) - First Bank: Bank of Hindustan (1770) in Calcutta (failed later). - Presidency Banks: Bank of Bengal (1806), Bank of Bombay (1840), and Bank…
2. RBI: Structure, Functions and Acts — Introduction - Established on April 1, 1935 , under the Reserve Bank of India Act, 1934. - Based on the recommendation of the Hilton Young Commission . - Initial capital: ₹5…
3. Monetary Policy Committee & Tools — Monetary Policy Committee (MPC) - Formed in 2016. Total 6 members (3 from RBI, 3 from Govt). - Meets at least 4 times a year. - Goal: Maintain price stability while keeping growth…
4. Banking Products: Deposits and Accounts — 1. Demand Deposits - Savings Account: For individuals. Earns interest. Withdrawals allowed via cheques/ATMs. - Current Account: For businesses. No interest earned (usually). No…
5. Negotiable Instruments & Cheques — Negotiable Instruments Act, 1881 - Defines documents that are transferable by delivery or endorsement. - Section 4: Promissory Note (Promise to pay). - Section 5: Bill of Exchange…
6. NPAs and Recovery Mechanisms — What is an NPA? A loan or advance for which the principal or interest payment remained overdue for a period of 90 days . Classification of NPAs 1. Sub-standard Assets: NPA for le…
7. Basel Norms: Capital Adequacy — Introduction International banking regulations issued by the BCBS (Basel Committee on Banking Supervision) based in Basel, Switzerland. The Three Pillars of Basel II & III 1.…
8. Financial Inclusion & Government Schemes — What is Financial Inclusion? The process of ensuring access to financial services (Banking, Insurance, Pension) at an affordable cost to the underprivileged. Key Schemes 1. PMJDY…
9. Priority Sector Lending (PSL) — What is PSL? RBI mandates banks to lend a part of their credit to sectors that are essential for the economy but often lack funding. Targets - Domestic Commercial Banks: 40% of…
10. RBI Subsidiaries & National Institutions — Fully Owned Subsidiaries of RBI 1. DICGC: Deposit Insurance and Credit Guarantee Corporation. Insures bank deposits up to ₹5 lakh per account in case of bank failure. 2. BRBNMPL:…
11. Digital Banking: Payment Systems — NPCI (National Payments Corporation of India) Established in 2008 by RBI and IBA. It is the umbrella organization for all retail payments in India. Major Payment Modes 1. RTGS…
12. Cards: Debit, Credit & RuPay — Types of Cards 1. Debit Card: Linked to bank account; money deducted instantly. 2. Credit Card: A form of unsecured loan; "Buy now, pay later". 3. Prepaid Card: Loaded with a…
13. Banking Ombudsman & KYC Norms — Banking Ombudsman Scheme (1995) - A senior official appointed by RBI to redress customer complaints against deficiency in banking services. - Integrated Ombudsman Scheme (2021):…
14. NBFCs and Shadow Banking — What is an NBFC? Non-Banking Financial Company. Registered under the Companies Act . They provide banking-like services but don't hold a banking license. Difference between Bank…
15. Financial Market Instruments — Money Market (Short-term) - Call/Notice Money: Overnight to 14 days inter-bank loans. - Commercial Paper (CP): Unsecured promissory note by corporates. - Certificate of Deposit…
16. A-Z Exhaustive Banking Terminology — Essential Terms - Amortization: Systematic repayment of a loan in installments. - Arbitrage: Profit from price difference of same asset in different markets. - Balloon Payment:…
17. Monetary Policy: Rate Toolkit & Transmission — 1. Monetary Policy Committee (MPC) - RBI's Monetary Policy Committee (MPC) has 6 members : 3 from RBI and 3 appointed by the Government of India . - It meets roughly every 2…
18. Priority Sector Lending, NBFCs & Basel Norms — 1. Priority Sector Lending (PSL) - Domestic commercial banks and foreign banks with 20 or more branches must lend 40% of ANBC (Adjusted Net Bank Credit) to priority sectors. -…

History of Banking in India: Detailed Phases

Phase 1: Pre-Independence (1770-1947)

• First Bank: Bank of Hindustan (1770) in Calcutta (failed later).
• Presidency Banks: Bank of Bengal (1806), Bank of Bombay (1840), and Bank of Madras (1843).
• Imperial Bank of India (1921): Merged the three presidency banks. It later became the State Bank of India in 1955.
• First Bank with Indian Management: Oudh Commercial Bank (1881).
• First Purely Indian Bank: Punjab National Bank (1894), founded by Lala Lajpat Rai.
• Oldest Joint Stock Bank: Allahabad Bank (Now merged with Indian Bank).

Phase 2: Post-Independence & Nationalization

• RBI Nationalized: Jan 1, 1949.
• SBI Formed: July 1, 1955, based on the AD Gorwala Committee recommendation.
• 1st Wave of Nationalization (July 19, 1969): 14 major commercial banks with deposits > ₹50 crore nationalized (Indira Gandhi govt).
• 2nd Wave of Nationalization (April 15, 1980): 6 more banks with deposits > ₹200 crore nationalized.

Phase 3: Banking Sector Reforms (1991-Present)

• Narasimham Committee (1991 & 1998): Recommended LPG reforms, entry of private banks, and reduction of CRR/SLR.
• New Private Sector Banks: HDFC, ICICI, Axis, IDBI (set up in the 1990s).

Key points

• State Bank of India is the largest Public Sector Bank in India.
• Nationalization aimed at "Social Control" over banks to support agriculture and small industries.
• India currently has 12 Public Sector Banks (PSBs) after the 2020 mergers.

Frequently asked questions

Is this Banking & Financial Awareness (Comprehensive) material free?

Yes — all Banking & Financial Awareness (Comprehensive) notes and practice on Siksha Sarovar are completely free.

Is the content available in Hindi?

Yes. Lessons are bilingual (English and Hindi) so you can study in whichever language you are comfortable with.

Which exams does this help with?

It is aligned to IBPS PO/Clerk, SBI PO/Clerk, RBI Grade B, RBI Assistant, RRB PO/Clerk, Insurance Exams and similar government exams.