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introduction: A bank is afinancial intermediarythat acceptsdepositsand channels thosedeposits intolendingactivities, either directly or throughcapital markets. A b a n k c o n n e c t s c u s t o m e r s w i t h c a p i t a l d e f i c i t s t o c u s t o m e r s w i t h c a p i t a l surpluses.

B a n k i n g i s g e n e r a l l y a highly regula tedi n d u s t r y , a n d g o v e r n m e n t restrictions on financial activities by banks have varied o v e r t i m e a n d locationT h e w o r d bank w a s b o r r o w e d i n Middle EnglishfromMiddle Fr ench banque, from OldItalianbanca, fromOld High German banc, bank "bench,c o u n t e r " . B e n c h e s w e r e u s e d a s d e s k s o r e x c h a n g e c o u n t e r s d u r i n g t h e RenaissancebyF lorentinebankers, who used to make their transactions atopdesks covered by green tablecloths. HISTORY OF BANKING Before we look into the knittyg r i t t y o f b a n k i n g s e c t o r r e f o r m s process , we must have a proper perspective of what i s t h e h i s t o r y o f o u r banking system in India

and also understand the rationale of why reform isnecessary and what reforms are essential. Like in many other aspects, Indiahad a long tradition of banking. Evidence regarding the existence of moneylending operations in India is found in the literature of the Vedic times, i.e.2000 to 1400 B.C. The literature of the Buddhist period, for e.g., the jatakas,and recent archaeological discoveries supply evidence of the existence of sresthis, or bankers. Form the laws of menu. It appears that money-lendingand allied problems had assumed considerable importance in ancient India.What were the interests? They were prescribed by almost all Hindulaw-givers, Menu, Vasistha, Yajnavalkya, Gautama and Baudhayana as alsoKautilya. A common base number was 15 per cent annum what the banker economist Dr. Thingalaya calls Hindu rate of interest. Incidentally, this isc l o s e t o c u r r e n t P r i m e L e n d i n g R a t e ( P L R ) o f m a n y b a n k s . H o w e v e r , Chanakya gives a different approach. The interest works out for 15 percenta n n u m f o r g e n e r a l a d v a n c e s . The traders are charged a rate of 60 % p . a . Where the merchandise has to pass through forests, the traders have to pay120 % while those engaged in the export-import business handling seabornec a r g o h a v e t o p a y 2 4 0 % p . a . Chanakyas interest rate structure is

risk w e i g h t e d ; t h e r a t e o f i n t e r e s t i n c r e a s e s w i t h t h e r i s k i n v o l v e d i n t h e borro wers business. Again, it is not everyone who could take up banking business. The Dharmashastra laid down the rates according to the castes of the borrowers, and the eligibility of men belonging to Vaishya caste alonec o u l d t a k e u p t h e m o n e y lending profession. In other words, in ancie n t times, your caste gives you license to banking; not RBI!!! TYPES OF BANKS

UBLIC SECTOR BANK Public sector banks are those banks r u n u n d e r t h e c o n t r o l o f government and their prime motive is the welfare of the general public. A public sector bank also looks for funding developmental work in the countryas the government has a majority share in it.T h e f i r s t o b j e c t i v e w o u l d a l w a y s b e t o m a k e p r o f i t . e v e r y organization whether private or public is here to make profits so that it could justify their existence. but public sector banks involves public also. Public here means common people like us. This refers to banks that have their shares listed in the stock exchanges NSE and BSE and also the government of India holds majoritystake. It is as good as the government running the bank. Since the publicdecide on who runs the government.All the nationalised banks are public sector but all public sector banksare not nationalized The following are the list of Public Sector Banks in India

Central Bank is a government-owned bank, is one of the oldest andlargest commercial banks in India based in Mumbai. The bank currently has3,168 branches and 270 extension counters across 27 Indian states RESERVE BANK OF INDIA Reserve Bank of India is also known as India's Central Bank. It wasestablishe d on 1st April 1935. Although the bank w a s i n i t i a l l y o w n e d privately, it has been taken up the Government of India ever since, it wasn a t i o n a l i z e d . T h e b a n k h a s b e e n v e s t e d with immense responsibility of reviewing a nd reconstructing the economic stability of t h e c o u n t r y b y formulating economic policies and ensuring a proper exchange of currency.I n t h i s regard, the Reserve Bank of India is also k n o w n a s t h e b a n k e r o f banks. PRIVATE SECTOR BANK

Private Banks in India started way back. Private banking in India was practiced since the beginning of banking system in India. In India the year of 1935 the reserve bank of India was build and it became the centreof all the other banks taking the imperial responsibilities that includes thetransfer of commercial banking completelyThe first private bank in India to be set up in Private Sector Banks inIndia was IndusInd Bank. It is one of the fastest growing Bank PrivateSector Banks in India. IDBI ranks the tenth largest development bank inthe world as Private Banks in India.The first Private Bank in India to receive an in principle approvalf r o m t h e R e s e r v e B a n k o f I n d i a w a s H o u s i n g D e v e l o p m e n t F i n a n c e Corporation Limited, to set up a bank in the private sector banks in Indiaas part of the RBI's liberalisation of the Indian Banking Industry. It was i n c o r p o r a t e d i n August 1994 as HDFC Bank Limited with r e g i s t e r e d office in Mumbai and commenced operations as Scheduled CommercialBank in January 1995. List of Private Sector Bank

Documentation

Latest 3 month Bank Statement 3 Latest Salary slips Proof of Continuity current job(Form 16/ Company appointmentletter) Proof of Identity Passport/ Driving Licence/ Voters ID. Proof of Residence Ration Card/ LIC Policy Receipt Proof of Qualification Highest Degree. IDBI PERSONAL LOAN

Key Features Loan upto Rs. 10 lakhs Attractive Interest Rate Low Processing Fees & Documentation Charges Faster Approval & Minimum Documentation Repayment period up to 60 months No collateral/ security Eligibility Salaried IndividualsE l i g i b i l i t y M i n i m u m M a x i m u m A m o u n t ( I N R ) R s 5 0 0 0 0 R s 1 0 , 0 0 , 0 0 0 R e p a y m

e t n o g 2 r t d

n h t n e y 3 s

t 1 h t

M 2 6 h 2 r ( e o o 0 s

o m A 3 s y A n f a

n o m

l n ) Documentaion

Salaried Individuals Photograph Age Proof Identity and Signature proof Salary slip Latest form 16 Credit Card statemnt or repayment track record Interest Rate and Other Charges Interest Rate: 16% to 18% Processing Fees: 1.5% Documentaion Charges: 0.5% FIELD STUDY What are the principal types of loans made by your bank?

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