Type of Bank


In our childhood, we knew banking as an organization where money could be deposited and withdrawn as per requirement. In present days, we come across different types of bank in the financial market. Reserve Bank of India (RBI) has given different type of bank license to the financial institutions with the specific object to operate the banking/finance business in India. Every category of bank has different types of objective and target rule out by Reserve Bank of India.

Commercial Bank


Commercial Bank is a profit making organization which accept deposits and advance/lend money to individual, firm and corporate. Commercial Bank gives interest on deposit and charge interest from its customers on the lending amount. The difference between earned interest and given interest is the profit of the bank. Bank also earns fees & commission income for other services to its clients. Commercial Bank plays the major role in Indian Financial System.


Co-operative Bank

Co-operative Bank in India is integral part of Indian Financial Inclusion. Indian Co-operative Bank is the largest structure in world. Co-operative bank is initially set up  to supplant indigenous sources of rural credit, particularly money lenders, presently they mostly serve the needs of agriculture and allied activities, rural-based industries and to a lesser extent, trade and industry in urban centers. Co-operative banks reach those areas where commercial bank can’t reach and provide the credit to the society where people depend on money lenders only. 

National Bank for Agricultural and Rural Development (NABARD)   

NABARD was established on the recommendations of Shivaraman Committee, (by act 61, 1981 of Parliament) on 12 July 1982 to implement the National Bank for Agriculture and Rural Development Act 1981. It replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC). It is one of the premier agencies to provide credit in rural areas. NABARD is India's specialized bank for Agriculture and Rural Development in India.

International associates of NABARD ranges from World Bank-affiliated organizations to global developmental agencies working in the field of agriculture and rural development. These organizations help NABARD by advising and giving monetary aid for the upliftment of the people in the rural areas and optimizing the agricultural process. 

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Exchange Bank  

Exchange Banks are mainly deals in foreign exchange and they are specialized in foreign tread financing. These banks also provide the services of collecting & supplying information about the foreign customer and remittance services etc.  

Exim Bank  

Exim Bank is Export Import Bank of India. It is established in 1982 with the object to provide the service to exporter & importer. Exim Bank provides the services like Marketing Advisory Service, Export Advisory Service etc and also offers the financial products like Lines of Credit, Project Export finance, Buyer’s Credit etc.

Payment Bank  

Payment Bank is a special category bank which can offer selective banking service to their customer. These services include acceptance of deposit, payment and remittance service, internet banking, the payment bank can issue the debit/ATM card but can’t issue the credit card or can’t offer any loans. They can functions as business correspondent of other bank. Initially they can accept deposit upto 1 Lac maximum from an individual. Reserve Bank of India has given license to 11 entities to open payment bank –
Aditya Birla Nuvo
Airtel M Commerce Services
Cholamandalam Distribution Services
Dilip Shanghvi, (founder of Sun Pharmaceuticals)
Department of Posts
FINO PayTech
National Securities Depository
Reliance Industries
Tech Mahindra
Vijay Shekhar Sharma, (CEO of Paytm)
Vodafone M-Pesa   

Small Bank  

Reserve Bank of India has given license to 10 entities mainly micro finance companies to set up small bank and provide advance to unbanked, small business, farmers, micro & small business units which don’t access the finance from larger banks. Small bank are similar to the commercial bank but they need to generate 75% of business from the priority sector and 50% of their loan should within the ticket size of INR 25 Lac. 
Au Financiers (India) Ltd
Utkarsh Microfinance
RGVN (North East) Microfinance
Disha Microfin
Capital Local Area Bank
Equitas Holdings
ESAF Microfinance

Janalakshmi Financial

Suryoday Microfinance
Ujjivan Financial