Commercial Banks: Commercial Banks are banking institutions that accept deposits and grant short-term loans and advances to their customers.
Types of commercial banks:
(i) Public Sector banks : These are banks where majority stake is held by the Government of India or Reserve Bank of India. Examples of pubic sector banks are : State Bank of India, Corporation Bank, Bank of Baroda, Dena Bank, etc.
(ii) Private Sector banks : In case of private sector banks majority of share capital of the bank is held by private individuals.
For example : The Jammu and Kashmir Bank Ltd., Bank of Rajasthan Ltd., Development Credit Bank Ltd., Lord Krishna Bank Ltd., Bharat Overseas Bank Ltd., Global Trust Bank, Vysya Bank, etc.
(iii) Foreign banks: These banks are registered and have their headquarters in a foreign country but they operate their branches in our country. Some of the foreign banks operating in our country are Hong Kong and Shanghai Banking Corporation (HSBC), Citibank, American Express Bank, Standard & Charted Bank, Grindlay’s Bank, etc.
3. Development Banks : Business often requires medium and long-term capital for purchase of machinery and equipment, for using latest assistance is provided by Development Banks. They also undertake other development measures like subscribing to the shares and debentures issued by companies, in case of under subscription of the issue by the public.
Industrial Finance Corporation of India (IFCI) and State Financial Corporations (SFCs) are examples of development banks of India.
4. Co-operative Banks : People who come together to jointly serve their common interest often form a co-operative Societies Act. When a co-operative society engage itself in banking business it is called a Co-operative Bank.
Types of Co-operative banks :
(i) Primary Credit societies
(ii) Central Co-operative banks
(iii) State co-operative banks
5. Specialized banks : There are some banks, which cater to the requirements and provide overall support for setting up business in specific areas of activity. Export- Import Bank (EXIM Bank), Small Industries Development Bank of India (SIDBI) and National Bank for Agriculture & Rural Development (NABARD) are examples of such banks.