In this article, we’re taking a look at non-scheduled banks in India.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Non-Scheduled Banks in India
- Difference Between Scheduled and Non-Scheduled Banks in India
- Frequently Asked Questions
- Ready to Explore Your Options?
Non-Scheduled Banks in India
Non-scheduled banks in India refer to small community banks that do not qualify to access funds directly from the Reserve Bank of India (RBI). This is due to a lack of reserve capital, which makes them ineligible except in extraordinary circumstances. In general, banking with non-scheduled banks in India should only be considered when very localized needs require it. Otherwise, national or foreign scheduled banks should be used for Indian banking activities instead.
Difference Between Scheduled and Non-Scheduled Banks in India
The main difference between scheduled and non-scheduled banks in India is the size of their capital reserves. Non-scheduled banks maintain capital reserves of less than 5 lakh while scheduled banks generally maintain significantly larger reserves.
That said, there is a wide range of other differences between scheduled and non-scheduled banks in India. This includes differences in their ability to access state reserves, frequency and accuracy of auditing practices, availability of banking products and services, and much more.
Unfortunately, the vast majority of banks in India fall into the category of non-scheduled banks. In fact, in the category of Urban Commercial Banks (UCBs), there are a total of 2,084 banks, of which 2,033 are non-scheduled banks. In other words, only 51 or 2.4% of all Urban Commercial Banks in India are scheduled banks with access to borrowing directly from the Reserve Bank of India.
Scheduled Banks in India
Scheduled banks in India include large national and foreign banks. However, these banks are divided into several key categories, which include (1) Public Sector Banks, (2) Private Sector Banks, (3) Small Finance Banks, (4) Payment Banks, (5) Regional Rural Banks, (6) and Foreign Banks.
Here’s a look at some of the scheduled foreign banks that are active in India:
- Abu Dhabi Commercial Bank Ltd.
- ANZ Banking Group Ltd.
- Barclays Bank Plc.
- Bank of America
- Bank of China
- Bank of Nova Scotia
- BNP Paribas
- DBS Bank India Limited
- Deutsche Bank
- Emirates Bank NBD
- First Abu Dhabi Bank PJSC
- HSBC Ltd
- Industrial & Commercial Bank of China Ltd.
- J.P. Morgan Chase Bank N.A.
- KEB Hana Bank
- Mashreq Bank PSC
- Mizuho Bank Ltd.
- NatWest Markets Plc
- Standard Chartered Bank
Non-Scheduled Banks in India
As mentioned, non-scheduled banks in India are those with less than 5 lakh. While this may seem low, there are more than 2,000 non-scheduled banks active in the country.
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Frequently Asked Questions
Below are two of the most common questions that we receive from people looking into non-scheduled banks in India. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
How Many Non-Scheduled Banks Are There in India?
How many non-scheduled banks are in India depends on the specific category of non-scheduled banks that you are referring to. For example, in the Category of Urban Commercial Banks (UBC) there are over 2,000 non-scheduled banks, or 97.6% of all the Urban Commercial Banks in the country.
Is SBI a Non-Scheduled Bank?
SBI (State Bank of India) is a Scheduled Bank. More specifically, SBI is one of the 12 scheduled public sector banks that operate in India. The other banks include Bank of Baroda, Bank of India, Central Bank of India, Indian Overseas Bank, Punjab National Bank, Union Bank of India, and more.
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