Indian banking, both commercial and central banking have undergone sea change, ever since they were established. Commercial banks were only serving affluent class to start with. Gradually it changed its perception and started looking at other sections of the society. Change started taking place by introducing the concept of socialisation in commercial banks. Nationalisation was the next step to reach the weaker sections of the society. As it did not reach the expected level, revolutionary step as that of “Financial inclusion” took place to extend banking facility to the last person of the country.
Several for reaching structural and policy changes took place in Reserve Bank of India, the central bank of the country, to make banking user savy.
On the operational side, information technology solutions were introduced beyond imagination relegating traditional banking to the back. Whole banking sector of the country is revolutionised after 2014. The proposal to establish “Bad Bank” to wash out NPAs and introduction of “Digital rupee” to smoothen the payment system are the latest developments in Indian banking.
In this backdrop, universities of Karnataka have prescribed “Banking Law and Practice” syllabus for B.Com fifth semester, covering both theory and operations. The topics include origin of banking, Reserve Bank of India, commercial banking types and operations, banking legislations related customer relationship, banking products, Negotiable instruments and recent developments. Such a vast subject is compressed to be taught in one semester. However, all care is taken to present all essential aspects in a simple and understandable style. We earnestly hope that teachers and the taught feel good by reading this books.
Contents –
UNIT – 1 INTRODUCTION TO BANKING
Banking: Meaning, Need and Importance; Primary, Secondary & Modern functions of banks; Origin of banking; Banker and Customer Relationship (General and special relationship); Types of Banks in India, RBI- History, Role & Functions. Banking Laws (Amendment) Bill-2024.
UNIT – 2 PAYING AND COLLECTING BANKER
Paying banker: Introduction, Meaning, Duties and Responsibilities, Precautions and Statutory Protection and rights; Dishonor of Cheques – Grounds of Dishonor, Consequences of wrongful dishonor of Cheques. Collecting Banker: Introduction, Meaning, Legal status of collecting banker- Holder for value, Holder in due course, Duties & Responsibilities, Precautions and Statutory Protection to Collecting Banker.
UNIT – 3 CUSTOMERS AND ACCOUNT HOLDERS
Introduction-Types of Customers and Account Holders; Procedure and Practice in opening and operating accounts of different customers Minors, Joint Account Holders, Partnership Firms, Joint Stock Companies, Executors and Trustees, Clubs and Associations and Hindu Undivided Family.
UNIT – 4 NEGOTIABLE INSTRUMENTS
Negotiable Instruments- Meaning, Definition & Features; Types of Negotiable Instruments- Promissory Notes, Bills of Exchange, Cheques; Crossing of Cheques- Types of Crossing; Endorsements- Meaning, Types and Essentials of Valid Endorsement.
UNIT – 5 RECENT TRENDS IN BANKING PRACTICES
Introduction-New technology in Banking- E-services-Debit and Credit cards-Internet Banking -Electronic Fund Transfer- MICR- RTGSNEFT- ECS-Small banks-Payment banks-Digital Wallet-Crypto currency-KYC norms-Basel Norms- Mobile banking-E- payments – E-money. Any other recent development in the banking sector.