Classification of Indian Banking System
The Indian banking system can be broadly classified into two categories:
- Scheduled Banks: Scheduled Banks are those banks that are listed in the 2nd Schedule of the Reserve Bank of India Act, 1934. These banks are further classified into two categories:
- Public Sector Banks: Public Sector Banks are banks that are owned and controlled by the government of India. They are further categorized as Nationalized Banks, State Bank of India and its Associates, and other Public Sector Banks.
- Private Sector Banks: Private Sector Banks are banks that are owned and controlled by private individuals or entities. These banks are further categorized as Old Private Sector Banks and New Private Sector Banks.
- Non-Scheduled Banks: Non-Scheduled Banks are those banks that are not listed in the 2nd Schedule of the Reserve Bank of India Act, 1934. These banks are also further classified into two categories:
- Cooperative Banks: Cooperative Banks are banks that are owned and controlled by the members of the cooperative society. These banks are further categorized as State Cooperative Banks and Urban Cooperative Banks.
- Non-Banking Financial Companies (NBFCs): NBFCs are companies that are engaged in the business of providing financial services, such as loans, investments, and credit facilities. They are not authorized to accept deposits from the public.
This classification of the Indian banking system helps in understanding the different types of banks and their ownership structure.
