General Knowledge – Banking Awareness GK for Exams
Banking Awareness GK for Exams: Banking Awareness is the most important topic which is useful for the candidates preparing for bank exams.
Important & Latest Banking Awareness 2021-2022
- Early Banking History
- Reserve Bank of India Structure & Function
- Management, currency circulation & lending rates
- Monetary Policy
- Accounts of Non-Resident India
- Security Interest
- ATM’s in India
- Types of Debit & Credit Cards
- Banking Related Scheme
- Monetary Policy
- MCLR Rates
- Non-Performing Rates
- Types of Codes used in the Banking Sector
- Transfer System in India
- Banking Related Scheme
- Securities Mark in India
- Ratings of Banks
- Foreign Investments
- Rupee Denominated Bonds
- External Commerical Borrowings and Trade Credits
- Money Transfer Scheme
- Inflation-Indexed Bonds
International Banking Organizations
- World Bank
- Asian Infrastructure Investment Bank (AIIB)
- BRICS Bank
- International Monetary Fund (IMF)
- Asian Development Bank (ADB)
- Bank of International Settlement (BIS)
Reserve Bank of India Subsidiaries
- National Housing Bank (NHB)
- National Bank for Agriculture and Rural Development (NABARD)
- Bharatiya Reserve Bank Note Mudran Private Limited
- Deposit Insurance and Credit Guarantee Corporation (DICGC)
Banks in India | Banking Awareness
- Small Finance Banks
- Regional Rural Banks
- Payment Bank
- Exim Bank of India
- Co-operative Banks
- Central Bank – Reserve Bank of India (RBI)
- State Bank of India
- Commercial Banking in India
- Export Credit Guarantee Corporation of India Ltd. (ECGC)
Banking Financing Terms: Banking Awareness GK for Exams
- Repo Rate
- Reverse Repo Rate
- SLR –(Statutory Liquidity Ratio)
- Retail banking
- Call money
- Notice money
- Non Performing Assets
- Money Inflation
- Retail credit operations
- Cash Credit
- Money laundering
- Direct Debit
- Bill of Exchange
- Cash Reserves Ratio
- Bank Rate
- Marginal standing facility
- Minimum Reserve System of RBI
- Banking Ombudsman
- The Balance of Trade
- A Balance of Payments
- NOSTRO Account
- VOSTRO Account
- Mutual Fund
- Negotiable Instrument
- Types of Cheque
Early Phase of Indian Banks, from 1786 to 1969: History of Banking in India
- The first bank, namely Bank of Bombay took establishment in 1720 in Bombay.
- Later on, the Bank of Hindustan took establishment in Calcutta in 1770.
- General Bank of India took establishment in 1786.
- Bank of Hindustan is on the business till 1906.
- First Joint Stock Bank with limited liability established in India in 1881 was Oudh Commercial Bank Ltd.
East India Company established the three independently functioning banks, also known by the name of “Three Presidency Banks” – The Bank of Bengal in 1806, The Bank of Bombay in 1840, and Bank of Madras in 1843.
- These three banks were there in 1921 and they gave a new name as Imperial Bank of India.
- After Independence, in 1955, the Imperial Bank of India took the name “State Bank of India”.
- The establishment took under the State Bank of India Act, 1955.
- The first bank with fully Indian management was Punjab National Bank Ltd on 19 May 1894, in Lahore (now in Pakistan).
- The number of banks in India in 1951 was the highest – 566.
- In 1960, RBI gave the notice to merge the weak banks with the strong ones.
- This led to a reduction in the number of banks to 89 in 1969.
- On April 15, 1980, another six banks were nationalized and thus raising the number of nationalized banks to 20.
Types of Scheduled Commercial Banks: Banking Awareness GK for Exams
Public Sector Banks
These are banks where the majority stake is held by the Government of India.
Examples of public sector banks are SBI, Bank of India, Canara Bank, etc.
Private Sector Banks
These are banks majority of the share capital of the bank is held by private individuals. These banks are registered as companies with limited liability. Examples of private sector banks are ICICI Bank, Axis Bank, HDFC, etc.
These banks are registered and have their headquarters in a foreign country but operate their branches in our country. Examples of foreign banks in India are: HSBC, Citibank, Standard Chartered Bank, etc
Regional Rural Banks
- Regional Rural Banks were established under the provisions of an Ordinance promulgated on the 26th September 1975 and the RRB Act, 1976 with an objective to ensure sufficient institutional credit for agriculture and other rural sectors. The area of operation of RRBs is limited to the area as notified by GoI covering one or more districts in the State.
- RRBs are jointly owned by GoI, the concerned State Government, and Sponsor Banks (27 scheduled commercial banks and one State Cooperative Bank); the issued capital of an RRB is shared by the owners in the proportion of 50%, 15%, and 35% respectively.
Prathama Bank is the first Regional Rural Bank in India located in the city Moradabad in Uttar Pradesh.
- A co-operative bank is a financial entity that belongs to its members, who are at the same time the owners and the customers of their bank. Co-operative banks are often created by persons belonging to the same local or professional community or sharing a common interest.
New Phase of Indian Banking System: Banking Awareness GK for Exams
On the suggestions of Narasimha Committee, the Banking Regulation Act was made some changes in 1993 and the gates for the new private sector banks were open.
In 1993, New Bank of India got to combine with Punjab National Bank.
- Industrial Development Bank of India (IDBI) took establishment as a Development Bank in 1964 by an act of Parliament.
- It was given the status of a scheduled bank in September 2004 by RBI.
Bharatiya Mahila Bank
- Bharatiya Mahila Bank Ltd known as all women’s bank took establishment in 2013.
- It is in New Delhi. Its first branch started its operations on November 19, 2013.
- Indian Prime Minister S. Manmohan Singh made the Inauguration.
Reserve Bank of India
- RBI is India’s central banking institution, which controls the monetary policy of the Indian rupee.
- RBI started its operations on 1 April 1935.
- The RBI has 21-member Central Board of Directors.
- They are the Governor, 4 Deputy Governors, 2 Finance Ministry representatives, 10 government-nominated directors and 4 directors to represent local boards headquarters at Mumbai, Kolkata, Chennai and New Delhi.
- The Government of India appoints the directors for a 4-year term.
- The concept of RBI depends on the guidelines by Dr Ambedkar to the “Royal Commission on Indian Currency & Finance” in 1925.
- Dr B. R. Ambedkar’s book “The Problem of the Rupee- Its origin and Its Solution” is made as a reference tool.
- The RBI was also known as Burma’s central bank, excluding the years of the Japanese occupation of Burma (1942–45), till April 1947.
- After Partition of India, the bank served as the central bank for Pakistan until June 1948 when the State Bank of Pakistan commenced operations.
- In 1949 the RBI got a green signal to be a national bank.
Functions of the RBI
- Financial Supervision
- Regulator and supervisor of the financial system
- Fake currency detection
- Exchange control
- Currency Issue
- Banker’s bank
Types of Bank Accounts: Banking Awareness GK for Exams
- Saving accounts can open by individuals in banks to save some share of their earnings.
- These savings accounts are open in the name of individuals only.
- On saving the account, an individual earns some rate of interest, these rates of interest vary for each bank.
- The current account is opened for business transactions, in the name of the firm or company.
- Banks offer no rate of interest on money held in current account but provide extra features like no limit on deposit or withdrawal.
Recurring Deposit Account or R.D.
- A recurring deposit account is a saving feature that the bank offers to its customers.
- who can save the only small amount of money per month?
- In recurring deposit account, a person deposits a fixed sum of money for a fixed period for which the bank pays interest every month and pays back the money with the interest at end of the term.
Fixed Deposit Account or Term Deposit Account
- In a fixed deposit account, a person deposits a fixed sum of money for a fixed period.
- The bank pays interest on the deposit account based on the time period of deposit. After the completion of the period, the bank pays the amount along with the interest earned.
More Details about Bank Accounts: Banking Awareness GK for Exams
FCNR Deposit Account
- FCNR stands for Foreign Currency Non -Resident account.
- This account is opened by NRIs.
- An Individual invests a fixed sum of money for a period of minimum one year and a maximum of five years in any foreign currency in FCNR account.
- After the completion of a period, principal and interest are paid in foreign currency in which they the deposition is made.
NRO Deposit Account
- The Non-Resident Ordinary Account (NRO Account) is a Savings / Current /Recurring Deposit / Fixed Deposit bank account held in India, in Indian Rupees.
- NRO account can open by any person outside India if he wants to earn an attractive rate of interest in India and also have some earnings in India.
- The Non-Resident External Account (NRE Account) is a Savings / Current/Recurring
- Deposit / Fixed Deposit bank account held in India, in Indian Rupees.
- NRE account can open only by the NRIs. With effect from March 1, 2014, interest rates offered by banks on NRE deposits cannot be higher than those offered by them on comparable domestic rupee deposits.
Payment Systems in India: Banking Awareness GK for Exams
RTGS: Real-Time Gross Settlement
It is a central payment system, through which interbank payment instructions will take the process and settle in real-time on Gross basis.
NEFT: National Electronic Funds Transfer
- It is a nation-wide fund transfer system which facilitates fund transfer from any bank’s branch to any other bank’s branch.
- The difference between NEFT and RTGS is that NEFT settlements happen in batches, and on net settlement basis whereas RTGS is a real-time and gross settlement.
AEPS: AADHAR Enabled Payment System
- It is a payment system which uses Aadhar card number and an individual’s online UIDAI authentication, which will have a link to a customer’s Bank account.
- A customer should register his/her Aadhar number to their existing bank account, providing their bank is AEPS enable.
- Through AEPS, the customer can withdraw or deposit cash, make a balance enquiry, and transfer funds.
MTSS: Money Transfer Service Scheme
It is a system of money transfer for transferring personal remittances from abroad to beneficiaries in India. Only inward remittance into India is permissible.
Nepal Remittance Scheme
It is a cross-border one-way remittance facility scheme for remittance from India to Nepal.
TYPES OF CHEQUES: Banking Awareness GK for Exams
- The cheque owner is responsible for withdrawing the Bearer Cheque.
- These types of cheques are normally useful for a cash transaction.
Order cheque is the cheque that the payee will be withdrawing.
- A crossed cheque is a cheque that is a mark to specify an instruction.
- A common instruction is to specify that it must be deposit directly into an account with a bank.
- The writer can protect the cheques from being stolen by crossing it.
Account Payee Cheque
- Adding a crossing to a cheque increases its security.
- In that, it cannot be cash at a bank counter but must be paid into an account in the same name.
- which appears on the ‘payee’ line of the cheque.
If a holder issues a cheque to the payee which will not be withdrawing from the bank till three months, then that type of cheque is stale cheque.
Post Dated Cheque
If a holder issues a cheque to the payee for the upcoming withdrawing date, then these are the postdated cheque.
- It is a medium of exchange that we can use in place of hard currency.
- They can be deposited in any world currencies and are pre-printed.
- People can use this on vacation in foreign countries without using cash.
The article post on banking awareness 2021 will help you in gaining more important knowledge about the banking sector in India.