Podcast
Questions and Answers
Which act governs the Indian banking system?
Which act governs the Indian banking system?
- Companies Act 1956
- Reserve Bank of India Act 1934
- Indian Financial Act 1950
- Indian Banking Regulation Act 1949 (correct)
Commercial banks primarily focus on lending to businesses and do not accept deposits from the public.
Commercial banks primarily focus on lending to businesses and do not accept deposits from the public.
False (B)
What is the main role of the central bank within a country's financial system?
What is the main role of the central bank within a country's financial system?
supervising, controlling, and regulating commercial banks
The Reserve Bank of India functions as the __________ bank of the country.
The Reserve Bank of India functions as the __________ bank of the country.
Match the following types of banks with their sector:
Match the following types of banks with their sector:
What is the primary function of commercial banks related to money?
What is the primary function of commercial banks related to money?
Central banks directly provide financial services to the general public.
Central banks directly provide financial services to the general public.
Besides supervising banks, what other role does a central bank typically play?
Besides supervising banks, what other role does a central bank typically play?
Commercial banks provide loans and in return, they receive __________.
Commercial banks provide loans and in return, they receive __________.
From whom do commercial banks accept deposits?
From whom do commercial banks accept deposits?
E-banking requires a physical branch visit to complete transactions.
E-banking requires a physical branch visit to complete transactions.
What are two benefits customers get from e-banking?
What are two benefits customers get from e-banking?
E-banking enables you to connect to the bank's services via a __________ or __________.
E-banking enables you to connect to the bank's services via a __________ or __________.
Which of the following is a key feature of e-banking?
Which of the following is a key feature of e-banking?
Cheque facility is not an essential function of commercial banks.
Cheque facility is not an essential function of commercial banks.
Briefly explain the term 'Remittance of Funds'.
Briefly explain the term 'Remittance of Funds'.
Allied services offered by banks include bill payment, locker facility and __________ services.
Allied services offered by banks include bill payment, locker facility and __________ services.
What do banks provide to their borrowers?
What do banks provide to their borrowers?
As borrowers, customers pay interest to the bank for the loans they receive.
As borrowers, customers pay interest to the bank for the loans they receive.
Apart from borrowers, __________ are also both borrowers and lenders.
Apart from borrowers, __________ are also both borrowers and lenders.
Flashcards
Commercial Banks
Commercial Banks
Institutions that deal in money and are governed by the Indian Banking Regulation Act 1949.
Banking
Banking
Accepting deposits of money from the public for lending or investment purposes.
Central Bank
Central Bank
Supervises, controls, and regulates the activities of all commercial banks in a country and acts as a government banker.
Reserve Bank of India (RBI)
Reserve Bank of India (RBI)
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Banks’ Core Activity
Banks’ Core Activity
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Remittance of Funds
Remittance of Funds
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Allied Services
Allied Services
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E-banking
E-banking
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E-banking Benefits
E-banking Benefits
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E-banking Transactions
E-banking Transactions
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Study Notes
- Banking: Central and Commercial
Commercial Banks
- Institutions dealing in money.
- Governed by the Indian Banking Regulation Act 1949.
- Banking means accepting deposits of money from the public for lending or investment purposes.
- Commercial banks are divided into public sector and private sector banks.
- Examples of public sector banks include SBI, PNB, and IOB.
- Examples of private sector banks include HDFC, ICICI, and Kotak Mahindra.
Central Banks
- Central Bank (CB) of any country supervises, controls, and regulates the activities of all commercial banks in the country.
- It also acts as a government banker.
- It controls and coordinates currency & credit policies of any country.
- Reserve Bank of India is the central bank of India.
Functions of Commercial Banks
- Acceptance of deposits is the basis of loan operations, since banks are both borrowers and lenders.
- Borrowers: pay interest.
- Lenders: grant loans and get interest.
- Lending of funds.
- Cheque facility.
- Remittance of funds provides facility for fund transfer from one place to another.
- Allied services include bill payment, locker facility, underwriting services.
New Generation Banking (E-banking)
- E-banking: any user with a PC and a browser can connect to the bank's website.
- They can perform any of the virtual banking functions.
- No human operator is needed.
- Benefits: Provides 24-hour, 365 days a year service to customers.
- Customers can make transactions from home, office, or while traveling via mobile.
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