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FIVE FINANCIAL INSTITUTIONS

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IN INDIA
 INTRODUCTION 2

A financial institution (FI) is a company engaged in the

business of dealing with financial and monetary
transactions such as deposits, loans, investments, and
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currency exchange.
The major categories of financial institutions include
central banks, retail and commercial banks, internet banks,
credit unions, savings, and loans associations, investment
banks, investment companies, brokerage firms, insurance
companies, and mortgage companies.
 Reserve Bank of India 3

The Reserve Bank of India is the Central Bank of the

country and it started operating since April 1, 1935.

The Reserve Bank of India is empowered to control, regulate,

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guide and supervise the financial system of the country through its
monetary and credit policies.

Traditionally, it is the bankers’ bank, and banker to State and Central

Governments. It is also a banker to the commercial banks, State co-
operative banks and financial institutions of the country. It is the only bank
engaged in the issue of legal tender currency.

RBI also performs development functions and controls the monetary policy
of the country.
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• Life Insurance Corporation of India (abbreviated as LIC) is an

Indian state-owned insurance group and investment corporation
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owned by the Government of India.

• The Life Insurance Corporation of India was founded in 1956
when the Parliament of India passed the Life Insurance of India
Act that nationalized the insurance industry in India.
• Over 245 insurance companies and provident societies were
merged to create the state-owned Life Insurance Corporation of
India
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• General Insurance Corporation of India (GIC Re) is a state owned

enterprise in India.
• It was the sole reinsurance company in the Indian insurance market
until the insurance market was open to foreign reinsurance players
by late 2016 including companies from Germany, Switzerland and
France.
• GIC Re has its registered office and headquarters in Mumbai.
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• Unit Trust of India is a significant financial institution in India.

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• The objective of setting up UTI was to encourage savings and to

make available the benefits of equity investments to small
investors to enable them to get a fair return on their investments
with the benefit of having trustees to manage their investments
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• Regional Rural Banks are Indian Scheduled Commercial Banks

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operating at regional level in different States of India.

• They have been created with a view of serving primarily the rural
areas of India with basic banking and financial services.
• The area of operation of RRBs is limited to the area as notified by
Government of India covering one or more districts in the State.
 CONCLUSION 8

Banks are a very important part of our economy. They are the
centre of finance. The main role of a financial institution is to
transfer financial resources from those who save it to those
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who are in need of financial resources for economic activity

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