BPS PO Banking Notes – Banking and Finance related

Committees
Sr No. Name of the committee Focus Area

For Reforms Relating To Non-Banking Financial

1 A C Shah Committee Companies (NFBC)

2 A Ghosh Committee Frauds & Malpractices in India

3 A K Khandelwal Committee HR issues of public sector banks

4 Abid Hussain Committee For Small Scale Industries

5 Aditya Puri Committee For Dissemination of Credit Information

6 Ajay Shankar Committee To review the functioning of PPP cell

Coordination between term lending institutions and

7 AK Bhuchar Committee commercial banks

Analysis the existing framework of IRDA-linked and

8 Amitabh Chaudhry Committee non-linked insurance product regulations

For giving clear definitions to Foreign Direct

Investment (FDI) and Foreign Institutional Investment
9 Arvind Mayaram Committee (FII)

10 Basel Committee For Banking Supervision

11 Bhandari Committee For Reconstruction of RRBs

12 Bhide Committee Coordination between commercial banks and SFC’s

13 Bimal Jalan panel To scrutinize applications for new bank licenses

14 C Rangarajan committee For poverty scale estimates in the country

15 Cook Committee For Capital adequacy of banks

16 Damodaran Committee For improvement of customer services in banks

17 Dave Committee (2000) For Pension Scheme For Unorganized Sector

18 Deepak Mohanty Committee Data and information management in the RBI

19 Deepak Parekh committee For Financing Infrastructure sector

To propose new regulation related to digital currencies

20 Dinesh Sharma Committee or virtual currencies

21 H R Khan Committee To evaluate unclaimed PPP and post office saving

To monitor and review the functioning of shell

companies to prevent their misuse for money laundering
22 Inter- departmental Tax Force and tax evasion

23 James Raj Committee Functioning of public sector banks

24 Janakiraman Committee To investigate the security transactions of the bank

25 Justice M B Shah Commission On black money

26 K M Chandrasekhar committee For rationalization of foreign investment norms

To examine the financial architecture for Micro, small

27 K.V.Kamath Panel and medium enterprises

28 Kelkar Committee For Tax Structure Reforms

29 M L Dhantwala Committee Regional Rural Banks

30 MBN Rao Committee To prepare the blueprint of India’s first women’s bank

31 N Rangachary committee To examine taxation policies for IT Sector

To review the fiscal responsibility and budget

32 N. K Singh Committee management act

33 Nachiket Mor Committee For comprehensive financial services for small

 businesses and low-income households

34 Narasimham Committee For Banking Sector Reforms

35 Naresh Chandra committee For 14 member task force on security issues

36 P J Nayak Committee Governance of Boards of Bank in India

37 Parthasarathi Shome For Tax Administration Reform Commission

For Implementation of GAAR (General Anti Avoidance

38 Parthasarathi Shome Committee Rule)

To study the feasibility of Aadhaar as an additional

39 Pulak Kumar Sinha Committee factor for authentication of card present transactions

40 R V Gupta Committee For Small Savings

41 R. Jilani Committee Inspection System in Banks

42 R.H. Khan Committee Harmonization of role of financial institution in banks

43 Raghuram Rajan Committee For Financial Sector Reforms

44 Raja Chelliah Committee For Tax Reforms

45 Rakesh Mohan Committee Small Savings

46 Rattan P Watal Committee To boost digital payment system in India

47 Rekhi Committee For Indirect Taxes

48 RS Gujral Committee To Suggest measures to boost MSME exports

49 S P Talwar Committee For Restructuring Of Weak Public Sector Bank

50 Shyamala Gopinath Committee For Suggestions on Post office Small saving schemes

51 SN Verma Committee (1999) For Restructuring The Commercial Banks

52 SS Nadkarni Committee Trading in public sector banks

To study regulatory issues relating to financial

53 Sudharshan Sen Committee technology and digital banking in India

To update, and revise the Banking Ombudsman

54 Suma Verma Committee Scheme, 2006

55 Tandon Committee Follow up for bank credit

56 UK Sharma Committee For NABARD’s Role In RRB

57 Urjit Patel Committee To examine the current monetary policy framework

58 Vaghul Committee For Money Market In India

59 Vipin Malik Committee Consolidated Accounting by banks

General Awareness section plays an important role if you have to score well in the Main
Examination. Generally, it is seen that students give less importance to this section as
compared to the other sections. Aspirants start preparing for the GA section only a few days
before the exam. To help you prepare for this section effectively, we are here discussing
some Important Banking Acts that are relevant and important for Bank exams.

Important Acts of Banking Sector

Negotiable Instrument act, 1881

Co-operative Societies Act, 1912
Reserve Bank of India Act, 1934
The Industrial Finance Corporation of India Act–1948
The Banking Companies (Legal Practitioner Clients’ Accounts) Act–1949
The Industrial Disputes (Banking and Insurance Companies) Act–1949
The Banking Regulation(Companies) Rules–1949
The Banking Regulation Act–1949
The State Bank of India Act–1955
The State Bank of India (Subsidiary Banks) Act-1959
The Subsidiary Banks General Regulation–1959
The Deposit Insurance and Credit Guarantee Corporation Act–1961
Banking Companies (Acquisition and Transfer of Undertaking) Act, 1969
The Regional Rural Banks Act–1976
The Banking Companies (Acquisition and Transfer of Undertakings) Act–1980
The National Bank for Agriculture and Rural Development Act–1981
NABARD General Regulations 1982
Banking Companies (Period of Preservation of Records) Rules, 1985
Banking Companies (Regulation)Rules,1985
The National Housing Bank Act–1987
SIDBI General Regulations, 1990
Securities and Exchange Board of India Act, 1992
The Industrial Finance Corporation (Transfer of Undertakings and Repeal) Act–1993
Recovery of Debts due to Banks and Financial Institutions Act,1993
Industrial Reconstruction Bank (Transfer of Undertaking & Appeal) Act–1997
Insurance Regulatory and Development Authority Act, 1999
Foreign Exchange Management Act, 1999
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest Act (SARFAESI-2002)
Prevention of Money Laundering Act, 2002
Fiscal Responsibility and Budget Management Act, 2003
Industrial Development Bank (Transfer of Undertaking & Repeal) Act–2003
Credit Information Companies (Rules & Regulation) Act–2005
Government Securities Act, 2006
The above mentioned Banking Acts are of utmost importance, but below, we have dealt with
only those Acts that are frequently asked in the examination and are totally important
from the exam's perspective.

Negotiable Instrument act, 1881

The Negotiable Instruments Act was introduced by the Imperial Legislative Council of
India and was enacted on 9th December 1881 to define laws related to negotiable
instruments. This act has been amended a lot many times and the last amendment done was
in 2002. As perSection 13 of this Act, "A negotiable instrument means a promissory note,
bill of exchange or cheque payable either to order or to bearer.Negotiable Instruments
may include Inland Instruments, Foreign Instruments and Bank Drafts.

Reserve Bank of India act, 1934

The RBI Act, 1934 is a legislative act under which the Reserve Bank of India was
established. Along with the Companies Act, it was amended in 1936 to provide a framework
for the supervision of banking firms in India. The act also defines Scheduled Banks.

Here are some of the highlights of this act:

 Section 17 of the Act defines the manner in which the RBI can conduct business.
 Section 18 defines emergency loans to banks.
 Section 21 states that the RBI must conduct the banking affairs for the central government and
manage public debt.
 Section 22 states that only the RBI has the exclusive rights to issue currency notes in India.
 Section 24 states that the maximum denomination of a note can be ₹10,000.
 Section 26 describes the legal tender character of the Indian bank notes.
 Section 28 allows the RBI to form rules regarding the exchange of damaged and imperfect
notes.
 Section 31 states that in India only the RBI or the central government can issue and accept
promissory notes that are payable on demand.
 Section 42(1) states that every scheduled bank must maintain an average daily balance with
the RBI.

Banking Regulation Act, 1949

This act regulates all banking firms in India i.e. it provides a framework via which commercial
banking in India is supervised and regulated.

Here are some of the highlights of this act:

 Primary Agricultural Credit Society and Cooperative land mortgage banks are not included
under this act.
 The act gives the RBI the power to issue new bank licences; have regulations over
shareholding and the voting rights of shareholders.
 It also allows RBI to supervise the appointment of the boards and regulate the operations of
banks.
 It also lays down the instructions for audits to be conducted by the RBI, control moratorium,
mergers, and liquidation issue directives in the interests of public good and on banking policy.
 Cooperative Banks were included in this act under the 1965 amendment.
 State Bank of India Act, 1955
Under the State Bank of India Act of 1955, the Reserve Bank of India acquired a controlling
interest in the Imperial Bank of India. On 1 July 1955, the Imperial Bank of India became the
State Bank of India. In 2008, the Government of India acquired the Reserve Bank of India's
stake in the SBI to remove any conflict of interest between the two as the RBI is the country's
topmost banking regulatory authority.

Deposit Insurance and Credit Guarantee Corporation Act,

1961
Under this Act, Deposit Insurance and Credit Guarantee Corporation(DICGC), a
subsidiary of the RBI was set up on 15th July 1978 to provide insurance of deposits and
guaranteeing of credit facilities. DICGC insures saving deposits, fixed deposits, current
deposits and recurring deposits up to a limit of Rs. 100,000. As per this act, all new
commercial banks are required to be registered as soon as they are granted a license by the
Reserve Bank of India.

Regional Rural Banks Act, 1976

Under this act, Regional Rural Banks were established to create an alternative channel to
the cooperative credit structure and to ensure sufficient institutional credit for the rural and
agriculture sector. This act was recommended by M. Narasimham. They are jointly owned
by the Government of India, the concerned State Government and Sponsor Banks with
the issued capital shared in the proportion of 50 per cent, 15 per cent, and 35 per cent
respectively.

Securities and Exchange Board of India Act, 1992

Under this act, the Securities and Exchange Board of India (SEBI) was given Statutory
powers on 30th January 1992. The Act was enacted for the regulation and development of
the securities market in India. It wasamended in the years 1995, 1999 and 2002 to meet the
ever-evolving needs of the securities market.

Foreign Exchange Management Act, 1999

This act was enacted to consolidate and amend the law relating to foreign exchange in order
to facilitate external trade and to promote orderly development and maintenance of foreign
exchange market in India. This Act replaced the Foreign Exchange Regulation Act
(FERA),which had become incompatible with the pro-liberalization policies of the Government
of India. The act paved the way for a new foreign exchange management regime that was
consistent with the emerging framework of the World Trade Organisation (WTO).
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act
(SARFAESI-2002)
SARFAESI Act, 2002 enables banks and other financial institutions to auction residential or
commercial properties to recover loans. ARCIL, the first Asset Reconstruction Company
(ARC) of India was set up under this act. The law does not apply to loans below ₹100,000
or where the remaining debt is below 20% of the original principal amount.

Prevention of Money Laundering Act, 2002

The act was enacted in order to prevent Money Laundering as well as to provide provisions
for the confiscation of properties obtained from money laundering. This act was amended in
2005, 2009 and 2012. It involves the following -

 Punishment for Money laundering

 powers of attachment of tainted property
 adjudicating authority
 the presumption in interconnected transactions
 Special court and FIU - Ind (Financial Intelligence Unit – India)

Fiscal Responsibility and Budget Management Act, 2003

FRBMA Act was introduced to eliminate the revenue deficit of the country. It also aims to
reduce India's fiscal deficit, improve economic management and the overall management of
public funds by moving towards a balanced budget.

This was all about some of the Important Banking Acts. Further, as we know that we have a
number of upcoming exams, so below we are providing you the link of test series for