Description
Describes the origin and growth of banking, commercial banking in India, functions of commercial banks, banking in the new millennium and CRM in Banking.
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Origin of Banking system Development of Banking in India Present Indian Banking System Commercial Banking in India Functions of Commercial Bank Challenges & Trends in Banking in India Universal banking CRM
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Originated from temples and royal palaces around 1000 B.C. in Babylon , Greece .Also functioning as treasuries against a receipt. Later, coins made of precious metals like gold and silver commonly accepted . Goldsmiths were the initial bankers and their receipts for money received – “guaranteed payments” or “goldsmith’s receipts” were the earliest forms of “bank instruments”. In the Middle Ages, the first bank in Italy called the “Bank of Venice” was established in 1157. Commercial banking has started only after 1640 when the goldsmiths started receiving deposits from the public for safe custody and issued receipts as acknowledgements, which were later used as bearer demand notes.
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Evidence of Banking system in Aryan Age- Mentioned in Rig Veda, Dharma Shastras The emergence of Vaishyas - Every town, big or small, had a Seth, a Shah, a Shroff or a Chettiar, who performed a number of banking functions The Hindustan Bank was the first bank to be established in 1779. Many came on later By 1913, due to the Swadeshi movement large number of Banks like The Punjab National Bank Ltd., Bank of India Ltd., Canara Bank Ltd., Indian Bank Ltd etc came up The Reserve Bank, which acts as the Central Bank was created in 1935 by passing of The Reserve Bank of India Act 1934. By the State Bank of India Act in 1955 the undertaking of the Imperial Bank of India was taken over by the newly constituted State Bank of India
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Public Sector Banks State Bank of India and its 7 associate banks called the State Bank Group, Twenty nationalized banks (now 19), Regional Rural Banks sponsored by public sector banks Private Sector Banks Old Generation Private banks, New Generation Private banks , Foreign banks in India ,Scheduled Co-operative banks ,Non-Scheduled banks Co-operative Sector Banks Central Co-operative banks ,State Co-operative banks ,Primary Agricultural Credit societies etc Development Banks IFCI , SIDBI , IIFC etc
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Transaction Services a) Banks convert deposits into notes and coins to enable holders of deposits to carry out transactions in cash (b) Bank deposits are used as a means of settling debts (c) In the absence of exchange controls, banks exchange cash and deposits from one currency into cash and deposits of another currency Intermediation Funds or savings of the surplus sectors are channeled to deficit sectors
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Payment & settlement system
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Real Time Gross settlement Transformation Services a) they enable liability, asset and size transformation (eg provision of large loans on the basis of numerous small deposits) b) maturity transformation (short maturities to long
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maturities) c) Risk transformation by transforming and reducing the
risk involved in direct lending by acquiring more diversified portfolios
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New non-banking organizations enter the fray No geographic barriers The amazing growth of e-banking Further delivery channels being launched Concept of Universal Banking Changing Customer Relationship Management
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Narrow banking - Banks to back their liabilities with safe assets, such as government securities. Benefits like :- Bank assets in high-quality instruments- minimize bank liquidity and credit risk. Prohibits from supplying risky loans and - confidence in the value of their liabilities is high Payment-system access restricted to narrow banks, payments would be protected against liquidity, credit, and settlement risks Universal banks are those banks that offer a wide range of financial services, beyond commercial banking and investment banking, insurance etc Benefits - higher output and better products What is actually required – A mix
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Changing in Banking outlet to Customers Traditionally, banking was “Personal” where the customer knew the bank employee who in turn knew the customer. By tracking the previous business done by the customer, the employee could anticipate his or her needs Complexity and volumes of transactions have increased There is lack of personal touch and a customer can be lured by other Financial Institutions Use of Media & Technology Technology provides the customer information, which he/she wants, the place, time and how he/she gets it However customer loyalty is still an issue
doc_622633407.pptx
Describes the origin and growth of banking, commercial banking in India, functions of commercial banks, banking in the new millennium and CRM in Banking.
? ? ? ? ?
?
? ?
Origin of Banking system Development of Banking in India Present Indian Banking System Commercial Banking in India Functions of Commercial Bank Challenges & Trends in Banking in India Universal banking CRM
?
Originated from temples and royal palaces around 1000 B.C. in Babylon , Greece .Also functioning as treasuries against a receipt. Later, coins made of precious metals like gold and silver commonly accepted . Goldsmiths were the initial bankers and their receipts for money received – “guaranteed payments” or “goldsmith’s receipts” were the earliest forms of “bank instruments”. In the Middle Ages, the first bank in Italy called the “Bank of Venice” was established in 1157. Commercial banking has started only after 1640 when the goldsmiths started receiving deposits from the public for safe custody and issued receipts as acknowledgements, which were later used as bearer demand notes.
?
?
?
? ?
? ?
?
?
Evidence of Banking system in Aryan Age- Mentioned in Rig Veda, Dharma Shastras The emergence of Vaishyas - Every town, big or small, had a Seth, a Shah, a Shroff or a Chettiar, who performed a number of banking functions The Hindustan Bank was the first bank to be established in 1779. Many came on later By 1913, due to the Swadeshi movement large number of Banks like The Punjab National Bank Ltd., Bank of India Ltd., Canara Bank Ltd., Indian Bank Ltd etc came up The Reserve Bank, which acts as the Central Bank was created in 1935 by passing of The Reserve Bank of India Act 1934. By the State Bank of India Act in 1955 the undertaking of the Imperial Bank of India was taken over by the newly constituted State Bank of India
?
Public Sector Banks State Bank of India and its 7 associate banks called the State Bank Group, Twenty nationalized banks (now 19), Regional Rural Banks sponsored by public sector banks Private Sector Banks Old Generation Private banks, New Generation Private banks , Foreign banks in India ,Scheduled Co-operative banks ,Non-Scheduled banks Co-operative Sector Banks Central Co-operative banks ,State Co-operative banks ,Primary Agricultural Credit societies etc Development Banks IFCI , SIDBI , IIFC etc
?
?
?
?
Transaction Services a) Banks convert deposits into notes and coins to enable holders of deposits to carry out transactions in cash (b) Bank deposits are used as a means of settling debts (c) In the absence of exchange controls, banks exchange cash and deposits from one currency into cash and deposits of another currency Intermediation Funds or savings of the surplus sectors are channeled to deficit sectors
?
?
Payment & settlement system
?
Real Time Gross settlement Transformation Services a) they enable liability, asset and size transformation (eg provision of large loans on the basis of numerous small deposits) b) maturity transformation (short maturities to long
?
maturities) c) Risk transformation by transforming and reducing the
risk involved in direct lending by acquiring more diversified portfolios
? ? ? ? ?
?
New non-banking organizations enter the fray No geographic barriers The amazing growth of e-banking Further delivery channels being launched Concept of Universal Banking Changing Customer Relationship Management
?
?
? ?
Narrow banking - Banks to back their liabilities with safe assets, such as government securities. Benefits like :- Bank assets in high-quality instruments- minimize bank liquidity and credit risk. Prohibits from supplying risky loans and - confidence in the value of their liabilities is high Payment-system access restricted to narrow banks, payments would be protected against liquidity, credit, and settlement risks Universal banks are those banks that offer a wide range of financial services, beyond commercial banking and investment banking, insurance etc Benefits - higher output and better products What is actually required – A mix
? ?
?
? ?
? ?
?
Changing in Banking outlet to Customers Traditionally, banking was “Personal” where the customer knew the bank employee who in turn knew the customer. By tracking the previous business done by the customer, the employee could anticipate his or her needs Complexity and volumes of transactions have increased There is lack of personal touch and a customer can be lured by other Financial Institutions Use of Media & Technology Technology provides the customer information, which he/she wants, the place, time and how he/she gets it However customer loyalty is still an issue
doc_622633407.pptx