Types of Banks

The major type of banks are two

1. Scheduled Banks

2. Non-Scheduled Banks

They are further classified into sub types with respect to their nature.

the following diagram will help you better understand it:

Structure of Types of Banks

Banking system in India starts with the Central Bank called RBI. RBI has specific functions to do than any other banks. such as they act as a regulating body of all banks. they also print and issue currency of the country yearly.

lets talk about Scheduled Banks.

they are classified into two:

1. Commercial banks

2. Co operative Banks.

Commercial banks are basically involved in profitable business. These basic function of this bank is to accept deposit from the public and use it to provide loans and advances to the needy people by charging certain interest rate, henceforth making profit.

Co-operative Banks on the other hand different from commercial banks and they do not lend higher amount of money. These banks are made by the bankers and promote habit of saving and investing in peoples. they are classified into two categories namely Urban & Rural Co-operative Banks.

The Commercial Banks are further classified as per the figure above but the number of banks have been changed in 2019 when the big decision by the govt came in: yes' Merging of banks made super changes in banking sector. Soon the merging list will be added here.

a. Public Sector Banks:

                                    The public sector Bank means the bank which have more than 50% of share is from govt side. In simple words they are the larger banks prevailing in the market and most trust able for the public because of governmental interference. the major bank of Public sector is SBI (State Bank of India)

b. Private Sector Banks:

                                    Private banks are established by private entities for making profit. but banks have to be registered as bank under banking Act 1949. though there are few additions were amended into banking regulations but this basic Act is necessary for any bank to qualify. these banks are more profitable as they charge high interest rate than public sector banks.

c. Foreign Banks:

                        these banks are specifically made for the purpose of business peoples. separate rules are made by RBI to regulate this bank. It is a type of international bank who are bound to follow home as well as host country. Foreign Banks are present in India either as representative offices or as branches.