Strengthening Indian Banking Industry through NPA Management

Since ancient times, an indigenous banking industry had prevailed in India with some communities being traditionally involved. These communities mostly ran huge businesses apart from their small banking business. They dealt mainly in money lending, did not accept deposits from customers, and discouraged savings.

The western type of banks came into the picture in the late 18th century in India when the Bank of Hindustan was established in 1770 in Calcutta (now Kolkata) in eastern India. Calcutta became the center of banking activities mainly due to the trading activities of the British Empire. In the 19th century, the major development in the Indian banking industry was the establishment of three presidency banks by the British East India Company. In 1935, the RBI was established under the provisions of the Reserve Bank of India Act, 1934...