Major Financial Institutions of India - Short Notes
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Now lets have a look at Indian Financial Institutions in Detail
Reserve Bank of India (RBI)
As we have discussed a number of times in this blog, RBI is the central
bank of India, which was established in 1st April 1935 accordance with
the provisions of the Reserve Bank of India Act, 1934. All of us know
that it issues currency notes. Apart from this, It acts as the
regulatory authority with regard to the functioning of the various
commercial bank and the other financial institutions in India. It also
formulates different rates and policies for the overall improvement of
the banking sector.
Commercial Banks
Both public and private sector banks comes under this category. The
commercial Banks are usually categorized into Scheduled Commercial Banks
and Unscheduled Commercial Banks. So, we can divide commercial banks as
under,
- Scheduled Commercial Banks : Those banks who have been listed under the Second Schedule of the Reserve Bank of India Act, 1934.
- Public Sector Banks : Those banks in which majority of stake is held by the government. All nationalized banks (for which IBPS conducts common exam) and SBI comes under this category.
- Private Sector Banks : Those banks in which majority of stake is held by private indivisuals. Axis Bank, ICICI Bank, HDFC Bank etc., comes under this category.
- Non scheduled commercial banks : The Banks which are not included in the Second Schedule of RBI Act 1934.
Credit Rating Agencies :
The main aim of Credit Rating Agencies is to assess the condition of the
financial sector and to find out avenues for more improvement. CIBIL,
Credit Environment India, CRISIL, SME Rating Agency of India, ICRA Ltd,
High Mark Credit Information Services, Equifax and Experian are the
examples of the Credit Rating Agencies of India.
Some of the services offered by Credit Rating Agencies are,
- Operation Up gradation
- Training to Employees
- Scrutinize New Projects and find out the weak sections in it
- Rate different sectors.
SEBI
The SEBI (Securities and Exchange Board of India) is the regulator for
the securities market in India. It was established in the year 1988 and
given statutory powers on 12 April 1992 through the SEBI Act, 1992.
Specialized Financial Institutions
Specialized Financial Institutions in India make an important segment
amongst all the financial institutions in India. The Indian financial
institutions are governed under the regulations of both the state and
central governments.
The governments on the other hand use them in structuring the planning and development of the country. The main target of Specialized Financial Institutions is to provide assistance to the different sectors and thereby cause overall development of the Indian economy.
The governments on the other hand use them in structuring the planning and development of the country. The main target of Specialized Financial Institutions is to provide assistance to the different sectors and thereby cause overall development of the Indian economy.
Some of the Specialized Financial Institutions of India are
- Export-Import Bank Of India : It is the premier export finance institution of the country, established in 1982 under the Export-Import Bank of India Act 1981.
- Small Industries Development Bank of India : It is an independent financial institution aimed to aid the growth and development of micro, small and medium-scale enterprises (MSME) in India. Set up on April 2, 1990
- National Housing Bank : It is a state owned bank and regulation authority in India, created on July 8, 1988[2] under section 6 of the National Housing Bank Act (1987).
- Board for Industrial & Financial Reconstruction : It is an agency of the government of India, part of the Department of Financial Services of the Ministry of Finance. It was established in 1987.
Insurance Companies
Insurance companies are the companies of rick management. They provide
us the equitable transfer of the risk of a loss, from one entity to
another in exchange for payment.
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