Banking Institutions and History

Co-operation, self help and mutual help are the working principle of Co-operative bank.

The central co-operative banks are the federations of primary credit societies in a district.
The central co-operative banks are
of two types.
The state co-operative bank acts as a watchdog of co-operative banks operating in the state.

Microcredit is generally considered to have originated with the Grameen Bank founded in Bangladesh in 1983.

Muhammad Yunus is a Bangladeshi social entrepreneur, banker, economist, and civil society leader who was awarded the Nobel Peace Prize for founding the Grameen Bank and pioneering the concepts of microcredit and microfinance.

CIBIL (Credit Information Bureau (India) Limited) was the first credit information company established in India to maintain credit records of individuals.

The RBI has historically focused on strengthening Urban Cooperative Banks (UCBs) through various schemes, including liquidity support mechanisms like the Emergency Fund Facility.

Scheduled banks are those listed in the Second Schedule of the RBI Act. Moneylenders are informal and are not part of the scheduled banking structure.

Money market refers to the market where money is traded just as a commodity between two parties. It is a part of financial market where money is used as a financial assets for short term borrowing, lending, buying and selling which matures in less than a year. Since money is given and taken on credits in this market, therefore it is also known as credit market. 

Central bank is an apex bank that regulates and controls the entire banking system of a country. The central bank lends money to government and the commercial banks when they are facing liquidity crunch or any type of insolvency. The central bank are the last resort to provide loans to the government and commercial banks against any type of collateral. Since Reserve Bank of India(RBI) is the central bank of India, it is also known as the lender of the last resort in India. 

RBI is the official lender of the last resort in India. Lender of the last resort means Central bank coming to the rescue of other banks in times of financial crisis.

India nationalized 14 banks in 1969, bringing the total to 19 nationalized banks (including the earlier nationalized State Bank of India).

NABARD (National Bank for Agriculture and Rural Development) was established in 1982 as the apex regulatory body for overall regulation of regional rural banks and apex cooperative banks in India.

ICICI stands for Industrial Credit and Investment Corporation of India. It was originally established as a development finance institution to provide medium and long-term project financing to Indian businesses.

Punjab National Bank acquired New Bank of India in 1993. Thereafter, no other nationalized bank in India has been merged into another bank.

In a major process of nationalization, seven subsidiaries of the State Bank of India were nationalized via the State Bank of India (Subsidiary Banks) Act, 1959. In 1969, fourteen major private commercial banks were nationalized.

B.  14

With Mrs. Indira Gandhi’s taking over as the Prime Minister of India, the Indian National Congress rallied for a state takeover of some of the major banks in the country. In what can be deemed a rather hasty move, the government promulgated an ordinance - the Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969 - thereby nationalizing all the 14 banks that were under consideration with effect from the midnight of 19 July 1969. As a follow-up to passing the ordinance, the Banking Companies (Acquisition and Transfer of Undertaking) Bill was taken up by the Parliament for discussion. It received a clear majority as well as the assent of the President within a month of issuing the ordinance.