- 3.1 - Functions of Commercial Bank
- 3.2 - Primary Functions of Banks
- 3.3 - Secondary Functions of Bank
- 4.1 - Cooperative Banks
- 4.2 - Primary central state co operative banks
- 4.3 - Indigenous Banker
- 5.1 - RBI and its Objectives
- 5.2 - Functions of RBI
- 5.3 - Credit Control Functions
- 6.1 - Internet Banking
- 6.2 - Cheque
- 6.3 - Crossing of Cheque and its different kinds
- 6.4 - Endorsement and its types
- 6.5 - Dishonour of Cheque
Scheduled Banks in India refer to those banks which have been included in the Second Schedule of Reserve Bank of India Act, 1934. RBI in turn includes only those banks in this Schedule which satisfy the criteria laid down vide section 42(6)(a) of the said Act. Banks not under this Schedule are called Non-Scheduled Banks.
Every Scheduled bank enjoys two principal facilities: it becomes eligible for debts/loans at the bank rate from the RBI; and, it automatically acquires the membership of clearing house.
In urban areas, they mainly serve small industry and self-employed workers. They are registered under the Cooperative Societies Act, 1912. They are regulated by the Reserve Bank of India under the Banking Regulation Act, 1949 and Banking Laws (Application to Co-operative Societies) Act, 1965.
answered by Twenty19Expert Team, [ Mar, 2017 ]
Discounting of Bills of exchange:
An accepted draft or bill of exchange sold for early payment to a bank or credit institution at less than face value after the bank deducts fees and applicable interest charges. The bank or credit institution then collects full value on the draft or bill of exchange when payment comes due.
answered by Twenty19Expert Team, [ Mar, 2017 ]
negotiable means, it is transferable by endorsement and delivery.
Endorsement means signing of a document which allows for the legal transfer.
Eg: When an employer signs a check, they are endorsing the transfer of money from the business accounts to the account of the employee
Bearer cheques will not have any name written on it, but just the amount authorized to withdraw. Any one in possession of the same can produce it to the bank and withdraw the mentioned amount.
While on the other hand, Order cheques will require you to mention a person or a company’s name to whom you authorize the withdrawal of the amount mentioned. On producing this type of cheques, banks generally ask for ID proof of the producer, so that the money only go to right hands. You can make Order cheques more secure by crossing them. Two cross lines are normally drawn at the top left of cheque which indicates that the cheque is A/C payee only. In other words, the amount mentioned on the cheque should be deposited to the A/C of person (whose name is mentioned on the cheque) and no physical cash be given.
Thank you sir. This has cleared my doubt.
answered by YashKothari, [ Jul, 2015 ]
The RBI acts as the custodian of the country’s foreign exchange reserves due to following:
The foreign exchange regulations under the law required that all foreign exchange receipts whether on account of export earnings, investment earnings, or capital receipts, whether oh private account or on government account, must be sold to the RBI either directly or through authorized dealers (mostly major commercial banks).
This resulted in centralisation of country’s foreign exchange reserves with the RBI and facilitated planned utilization of these reserves, because all payments in foreign exchange were also controlled by the authorities.
2. The Reserve Bank of India serves as a banker to the Central Government and the State Governments:
It provides a full range of banking services to these governments, such as:
(i) Maintaining and operating of deposit accounts of the Central and State Governments.
(ii) Receipts and collection of payments to the Central and State Governments.
(iii) Making payments on behalf of the Central and State Governments.
(iv) Transfer of funds and remittance facilities to the Central and State Governments.
(v) Managing the public debt and the issue of new loans and Treasury Bills of the Central Government.
(vi) Providing ways and means advances to the Central and State Governments to bridge the interval between expenditure and flow of receipts of revenue. Such advances are to be repaid by the government within three months from the date of borrowal.
(vii) Advising the Central and State Governments on financial matters, such as the quantum, timing and terms of issue of new loans. For ensuring the success of government loan operations, the RBI plays an active role in the gilt-edged market.
(viii) The bank also tenders advice to the government on policies concerning banking and financial issues, planning as well as resource mobilisation.
(ix) The Reserve Bank represents the Government of India as member of the International Monetary Fund and the World Bank.
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