Commercial Banks In India


Commercial banks are an important component of the country's financial system. Commercial banks are profit-making institutions that accept public deposits and lend money (loans) to individuals such as households, enterprises, and businessmen. The primary goal of these institutions is to make money through interest, commissions, and other means. The Reserve Bank of India, India's central bank and supreme financial authority, regulates all of these commercial banks' operations.
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The difference between these two rates, which they charge borrowers and pay depositors, is a commercial bank's principal source of income. ICICI Bank, State Bank of India, Axis Bank, HDFC Bank, Punjab National Bank, and the Central Bank of India are some of India's commercial banks.
 

FUNCTIONS OF COMERCIAL BANKS IN INDIA

Commercial banks have the following functions:

Commercial banks' functions can be divided into two categories.
 
Commercial Banks In India
(a) Basic functions
Deposits are accepted at the bank in the form of savings, current, and fixed deposits. Surplus funds received from businesses and people are lent to meet the short-term needs of commercial operations.
 
Another important duty of this bank is to provide loans and advances to entrepreneurs and business persons, as well as collect interest. It is the most important source of earnings for any bank. A bank keeps a small amount of deposits as a reserve and gives (lends) the rest to borrowers through demand loans, overdrafts, cash credit, short-term loans, and other types of loans.
 
Credit cash: When a customer is given credit or a loan, he or she is not given liquid cash. The customer's bank account is opened first, and then the funds are sent to the account. The bank is able to manufacture money through this technique.
 
(b)Secondary functions 
Discounting bills of exchange: A discount bill of exchange is a written agreement that acknowledges the amount of money to be paid against items acquired at a future date. A commercial bank's discounting strategy can also be used to clear the payment before the quoted period.
 
Overdraft facility: This is a loan offered to a customer in exchange for keeping their current account open and allowing them to overdraw up to a certain limit.
 
Purchasing and selling securities: The bank provides you with the option of buying and selling securities.
 
Customers can use a bank's locker facilities to store their valuables or papers discreetly. This service is charged at least once a year by the banks.
 
It uses various tools such as a promissory note, cheques, and bills of exchange to pay and collect credit.
 

CLASSIFICATION OF COMMERCIAL BANKS IN INDIA

Commercial banks are divided into four categories.

 
•    Banks listed in the Second Schedule of the RBI Act 1934 are referred to as Scheduled Banks. They are divided into the following categories:
 
•    Public Sector Banks: These are banks in which the government owns the majority of the stock. SBI, PNB, Syndicate Bank, Union Bank of India, and others are examples.
 
•    Banks in the private sector are ones in which private persons own the bulk of the stock. For example, ICICI Bank, IDBI Bank, HDFC Bank, AXIS Bank, and others.
 
•    Foreign Banks: These are banks that have their headquarters outside of the country in which they operate. Citibank, Standard Chartered Bank, Bank of Tokyo Ltd., and other financial institutions are examples.
 
•    Commercial banks that are not included in the Second Schedule of the RBI Act 1934 are known as non-scheduled commercial banks.
 

LIST OF COMMERCIAL BANKS IN INDIA

SBI & Associates:

•    State Bank of India
 
Commercial Banks In India
Nationalized Banks:
•    Allahabad Bank
•    Andhra Bank
•    Bank of Baroda
•    Bank of India
•    Bank of Maharashtra
•    Canara Bank
•    Central Bank of India
•    Corporation Bank
•    Dena Bank
•    Indian Bank
•    Indian Overseas Bank
•    Oriental Bank of Commerce
•    Punjab & Sind Bank
•    Punjab National Bank
•    Syndicate Bank
•    UCO Bank
•    Union Bank of India
•    United Bank of India
•    Vijaya Bank
 
Foreign Banks:
•    ABN Amro Bank
•    Abu Dhabi Commercial Bank
•    American Express Banking Corporation
•    AB Bank
•    Bank International Indonesia
•    Bank of America
•    Bank of Bahrain & Kuwait
•    Bank of Ceylon
•    Barclays Bank
•    BNP Paribas
•    Chinatrust Commercial Bank
•    Citibank
•    DBS Bank
•    Deutsche Bank
•    Hongkong & Shanghai Banking Corporation
•    JP Morgan Chase Bank
•    Standard Chartered Bank
•    UBS AG

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