BANKING SECTOR REFORMS AND DEVELOPMENT OF BANKING INDUSTRY IN INDIA

Beeralaguddada Srinivas Veerappa

Abstract


Indian banking industry emerged strongest emerging way for economic growth and development to face of Global Banking is undergoing a transition. Reforms  in  the  financial  sector,  covering  banking,  insurance,  financial  markets, trade, taxation etc. have been a major catalyst in strengthening the fundamentals of  the  Indian  economy.  The  broad  objective  of  the  financial  sector  reform  has thus  been  to  create  a  viable  and  efficient  banking  system.  Performance of the banking sector has impact across the length and breadthof  the  economy.  The  major  banking  sector reforms  comprises  of  modifying  the  policy  framework;  improving  the  financial soundness  and  credibility  of  banks;  creating  a  competitive  environment,  and strengthening of the institutional framework. The banking sector reform measures to  enhance  efficiency  and  productivity  through  competition  were  initiated  and sequenced to create  an enabling environment for banks  to overcome  the external constraints  which  were  related  to  administered  structure  of  interest  rates,  high levels of pre-emption  in  the form of reserve requirements,  and credit  allocation  to certain sectors.

An  attempt  has  been  made  in  this  paper  to  provide  a brief  overview  on performance of the Banking industry in India. It also includes a critical review of the performance  as  well  as  impact  of  Banking  Sector  Reforms  in  India.   It  has  also explained the models of swot analysis and Porter’s Five Forces Model, and  covered  the  role  and  measures  initiated  by  the  Reserve  Bank  in  India  [RBI]  in order to implement the Banking Sector Reforms in India. 


Keywords


Banking industry, Banking Sector Reforms, Swot Analysis, Porter’s Five Forces Model, India

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References


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