Financial Intermediaries

Banking Industry

    • With the passage of time, the industry saw its nationalisation (1969 and 1980) and again opening up for private sector entry (1993–94) to emerge as the most dependable segment of Indian financial system—in a way its mainstay
    • By April 2020, there were a total of 163 scheduled commercial banks operating in India—18 public sector banks (PSBs), 53 RRBs (with over 13 under consideration for amalgamation with their parent PSBs), 41 Indian private sector banks (including 10 Small Banks, 7 Payment Banks and 3 Local Area Banks), 46 foreign banks except the scheduled and non-scheduled state co-operative banks—with 74 per cent foreign direct investment (FDI) allowed in the private sector banks (49 per cent under automatic route and above 49 per cent under non-automatic route)

Insurance Industry

    • After Independence, these did serve the purpose by providing safety net and nation-building
    • In the wake of the process of economic reforms a restructuring of the sector was started and the industry was opened for entry of private players in 1999 and an independent regulator was set up—the IRDA (domestic and foreign—with an FDI cap of 49 per cent).
    • By April 2020, a total of 57 insurance companies were operating in India