History · Banking awareness

Banking history of India

The dates and names that come up in IBPS, SBI, RBI and NABARD exams, in order.

Early banks

1. 1770Bank of Hindustan

   Set up in Calcutta; regarded as the first bank in India. It closed in 1832.

2. 1786General Bank of India

   Another early Calcutta bank; it failed in 1791.

3. 1806 · 1840 · 1843The three Presidency banks

   Bank of Calcutta (1806, renamed Bank of Bengal in 1809), Bank of Bombay (1840) and Bank of Madras (1843).

4. 1865Allahabad Bank

   Oldest joint-stock bank in India. Merged into Indian Bank in 2020.

5. 1894Punjab National Bank

   Founded in Lahore, with Lala Lajpat Rai among its founders.

6. 1921Imperial Bank of India

   Formed by merging the three Presidency banks.

RBI and SBI

1. 1926Hilton Young Commission

   Recommended a central bank for India.

2. 1 April 1935Reserve Bank of India begins work

   Set up under the RBI Act, 1934. Its headquarters was in Calcutta, moved to Bombay in 1937. First Governor: Sir Osborne Smith; first Indian Governor: C. D. Deshmukh.

3. 1 January 1949RBI nationalised

   The RBI became fully government-owned.

4. 1949Banking Regulation Act

   Passed as the Banking Companies Act, 1949; renamed in 1966.

5. 1 July 1955State Bank of India

   Formed by taking over the Imperial Bank of India under the SBI Act, 1955, on the advice of the All India Rural Credit Survey Committee (Gorwala Committee).

Nationalisation and rural credit

1. 19 July 1969First nationalisation: 14 banks

   Banks with deposits of ₹50 crore or more were nationalised.

2. 15 April 1980Second nationalisation: 6 banks

   Banks with deposits of ₹200 crore or more.

3. 2 October 1975Regional Rural Banks

   First RRBs set up (Prathama Bank, Moradabad was the first); the RRB Act followed in 1976, based on the Narasimham Working Group.

4. 1978DICGC

   Deposit Insurance and Credit Guarantee Corporation formed by merging DIC (1962) and CGC (1971).

5. 12 July 1982NABARD

   Set up on the recommendation of the CRAFICARD (B. Sivaraman) committee.

Reforms, mergers and digital payments

1. 1991 · 1998Narasimham Committees I and II

   Banking sector reforms after 1991.

2. 2002SARFAESI Act

   Lets banks recover bad loans by taking over secured assets.

3. 2008NPCI

   National Payments Corporation of India set up to run retail payment systems.

4. 2016UPI and the Insolvency and Bankruptcy Code

   UPI launched in April 2016; the IBC was passed the same year.

5. 1 April 2017SBI merges its associates

   Five associate banks and Bharatiya Mahila Bank merged into SBI.

6. 1 September 2018India Post Payments Bank

   Launched nationwide.

7. 1 April 2019Bank of Baroda merger

   Vijaya Bank and Dena Bank merged into Bank of Baroda.

8. 1 April 2020Ten public sector banks become four

   Oriental Bank of Commerce and United Bank of India into PNB; Syndicate into Canara; Andhra and Corporation into Union Bank; Allahabad into Indian Bank.

Quick revision

• RBI established1 April 1935
• RBI headquartersMumbai
• SBI formed1 July 1955
• First bank nationalisation19 July 1969 (14 banks)
• Second nationalisation15 April 1980 (6 banks)
• RRBs2 October 1975
• NABARD12 July 1982
• NPCI2008, Mumbai
• UPI launchedApril 2016