FINANCIAL INSTITUTION

TABLE OF CONTENTS

•MEANING•FUNCTION OF FINANCIAL

INSTITUTION•TYPE OF FINANCIAL INSTITUTION•BANKING INSTITUTION•NON BANKING INSTITUTION•CONCLUSION•BIBILOGRAPHY

MEANING

F inancial institution   is an institution or organization that provides fi nancial services for its cl ients, members and society. Probably the most important fi nancial service provided by fi nancial institutions is acting as fi nancial intermediaries. Most fi nancial institutions are regulated by the government

FUNCTION OF FINANCIAL INSTITUTION•Financial institutions include

banks, credit unions, asset management fi rms, bui lding societies, and stock brokerages, among others. These institutions are responsible for distr ibuting fi nancial resources in a planned way to the potential users.

•These function performed in fol lowing ways……

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A. Accepting DepositsB. Providing Agricultural LoansC. Providing Commercial LoansD. Providing Real Estate LoansE. Providing Mortgage LoansF. Issuing Share Certificates

TYPE OF FINANCIAL INSTITUTION

We can divide financial institution in two major parts as following….1. Banking financial company(BFCs) 2. Non banking financial company(NBFCs) Banking institution can use banking instruments like cheque ,draft ,pay order but non banking institution can not use these instruments.

BANKING INSTITUTION

•Banking institution are those institution who is provide banking and other financial services to their customers and society such as …..

•Accept deposits•Provide loans •Cash management services•Portfolio management services

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•We can divide Indian banking system in following ways

•Commercial bankA)Public sector bank1) State bank2) Nationalized bankB)Private sector banka)Indian private bankb)Foreign private bank

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C)Co-operative bank1)Urban cooperative banks2) State cooperative banks3) Central cooperative banksD)Regional rural banks

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A)Public sector bank- public sector bank is divided into two groupState bank of India- State bank of India was established under SBI act 1955,initialy 100% stake of SBI owner was Reserve bank of India .Nationalized banks- Nationalized bank was established under banking company act 1970,1980, initially 100% ownership of 20s nationalized bank was hold by government of India

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B)Private sector bank- Private bank can be divided into two parts1)Indian private bank- This type of bank governed by Indian financial institution like ICICI bank ,HDFC bank2)Foreign private bank- this type banks governed by foreign institution like STANDARD CHARTED(USA) bank , HSBC

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C)Co-operative bank- These type bank are governed by co-operative societies1)Urban co-operative societies- These type bank are governed by urban co-operative society.2)State co-operative banks- These type bank work on state level,3)Central co-operative banks- These type bank work on district level

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D)Regional rural banks- RRB banks were established under RRB act 1976 these bank are closely related with the commercial bank which are specified by the central government with lead bank scheme.

Non banking financial company(NBFCs)

NBFIs at present consist of a heterogeneous group of institutions that cater to a wide range of financial requirements. These type company are involved in promoting new company ,expansion and meeting the financial requirement of the company for economic developmentNABARD (National bank for agriculture and rural development) – Nabard is working in India to promote agriculture and rural development.

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Industrial development bank of India(IDBI)- It is apex institution in the field of long term industrial finance it was set in 1964 as wholly subsidiary of RBI Industrial finance corporation of India(IFCI)-It was established in 1948, it provide assistance in long term loan, underwriting of equity and guarantee of loans in foreign exchange. Export Import Bank of India (EXIM Bank)-it facilitates export and import trading in India.

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Small Industries Development Bank ofIndia (SIDBI)-It provide assistance in small scale industryLife insurance corporation of India(LIC)-It provide all type insurance.Security and exchange board of India(SEBI)- It regulate all the activity in the Indian capital market

CONCLUSION….

•Financial institution is very essential part of financial system.

•Financial institution play a vital role in economic development

• Indian financial institutions are very strong but its operation is very poor quality we, Indian make very good plan but in implication we are lacking in somewhere.

•We have full range of financial institution bur we can not use in effective manner.

BIBILOGRAPHY

•WWW.WIKIPEDIA.COM•THE INDIAN BANKING SECTOR ON THE

ROAD TO PROGRESS- G. H. DEOLALKAR•COUNCIL ON FOREIGN RELATIONS, IIG

G INTERACTIVE GUIDE TO GLOBAL FINANCE –ARTICLE

•NON BANKING INSTITUTION –PROJECT REPORT