Phase 3 of Indian Banking

This phase has introduced many more facilities and changes in the banking sector in its reforms measure. In 1991, under the chairmanship of M Narasimham, a committee was set up by his name which worked for the liberalization of banking practices.

The country is rushed with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to customers. Phone banking and net banking are introduced.

The entire system became more convenient and speedy. This face has given more importance to time than money. The financial system of India has shown a great deal of flexibility. It is sheltered from any crisis triggered by any external macroeconomics shock as other East Asian Countries faced. This is all due to a flexible exchange rate system, the foreign reserves are high, the capital account is not yet fully convertible, and banks and their customers have restricted foreign exchange exposure.

For the past three decades India's banking system has several outstanding achievements in its credit. The most striking is its widespread reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners of the country, this is one of the main reasons of India's growth process.

The government's regular policy for Indian bank has paid rich dividends with the nationalization of 14 major private banks of India. Years ago an account holder had to wait for hours at the bank counters or for withdrawing his own money for getting a draft. Today, he has a choice. In those days the most efficient bank transferred money from one branch to other in two days. But now it is very simple as instant messaging. Money has become the order of the day.

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