This document outlines the roles and functions of various types of banks in India. It discusses commercial banks that accept deposits and provide loans and financial services. It notes that commercial banks can be public sector banks that are majority government owned or private sector banks that are privately owned. It also describes regional rural banks that provide credit to small farmers and laborers, cooperative banks that finance rural development, and the central bank that issues currency, regulates foreign exchange, and develops the financial system.

1. ROLES & FUNCTIONS OF
VARIOUS TYPES OF
BANKS

2. BANKS
Commercial
Banks
Schedule
Banks
Indian Banks
Public Sector
Banks
Private
Sector
Banks
Foreign Banks
Non-Schedule
Banks
Regional
Rural
Banks
Co-
operative
Banks
Central
Bank
Specialized
Banks

3. Commercial Banks
 Accepting deposits.
 Providing financial services to businesses.
 Includes credit & debit cards.
 Bank accounts.
 Loans
 Secured
 Unsecured
 Commercial Banks due to deregulations competing with investment banks
by bond underwriting, & financial advisory work.
 There are two types of commercial banks
 Public sector banks
 Private sector banks

4. Public Sector Banks
Public sector banks are banks in which
the government has a major holding.
At least 51% ownership is vested with
the government.
The shares of these banks are listed
on stock exchanges.
Private Sector Banks
Private sector banks are owned,
managed & controlled by private
promoters & they are free to operate
as per market forces.

5. Regional Rural Banks
 Set up on the recommendation of Narasimham Committee in 1975.
 To provide credit and other facilities to small and marginal farmers,
agricultural labours and artisans.
 The lending rates would be some what lower than the commercial
banks.
 These are intended to eliminate money lenders.
 These banks are to supplement the effort of cooperative banks.

6. Co-operative Banks
 Engaged in financing rural and agricultural development
 They function on “no profit no loss” basis.
 Perform limited banking functions.
 Some of them are scheduled banks but most are non- scheduled banks.
 Cooperative banks are financial intermediaries only because a
significant amount of their borrowings is from the RBI, NABARD,
central and state government .

7. Central Bank
 The main functions of central bank of a country are functions of note
issue, bankers to government, bankers bank etc.
 Provides currency for the government and banks.
 Regulates foreign exchange transactions.
 Developing the Indian financial system
 Encourages the extension of the commercial banking system in the
rural areas.