Financial Institutions and Regulatory Bodies in India

Comprehensive vocabulary flashcards covering the roles, institutional types, and regulatory authorities within the Indian financial ecosystem.

Financial Institutions

Organizations that provide financial services to individuals, businesses, and governments by facilitating the flow of money through savings, investments, lending, and risk management.

Commercial Banks

Banking institutions that accept deposits and provide loans to serve both individuals and businesses.

Investment Banks

Financial entities that assist corporations in raising capital and offer specialized financial consultancy services.

Central Banks

National authorities responsible for managing a country's currency, money supply, and benchmark interest rates.

Microfinance Institutions (MFIs)

Institutions that deliver financial services to low-income individuals or groups lacking access to traditional banking facilities.

Credit Unions

Member-owned financial cooperatives that offer standard banking services, typically at lower interest rates.

Finance Companies

Institutions that grant credit and loans for purchases, leases, or installments to individuals and businesses without accepting customer deposits.

Financial Intermediation

The core function wherein financial institutions pool funds from savers with surplus capital and allocate them to borrowers in need of funds.

Reserve Bank of India (RBI)

The central bank and regulatory authority of India, established on April 1, 1935, under the Reserve Bank of India Act, 1934, and nationalized in 1949.

Repo Rate

The benchmark interest rate at which the Reserve Bank of India lends money to commercial banks.

Reverse Repo Rate

The monetary policy rate at which the Reserve Bank of India borrows funds from commercial banks.

Cash Reserve Ratio (CRR)

The mandatory proportion of total deposits that commercial banks must keep in reserve with the Reserve Bank of India.

Statutory Liquidity Ratio (SLR)

The mandatory percentage of liquid assets that commercial banks must maintain in the form of cash, gold, or government-approved securities.

Open Market Operations (OMO)

The buying and selling of government securities by the central bank to manage liquidity levels within the economy.

Deposit Insurance and Credit Guarantee Corporation (DICGC)

A subsidiary of the Reserve Bank of India that provides insurance coverage to bank depositors in the event of bank insolvency.

Bharatiya Reserve Bank Note Mudran Private Limited (BRBNMPL)

A specialized subsidiary of the Reserve Bank of India dedicated to printing Indian currency notes.

Non-Banking Financial Company (NBFC)

Financial entities regulated under the RBI Act, 1934, that offer lending and asset financing but cannot accept demand deposits or issue chequebooks.

Housing Finance Company (HFC)

A specialized category of NBFC regulated by the National Housing Bank under the National Housing Bank Act, 1987, focusing on loans for housing and real estate.

Authorized Dealer Category I

Commercial banks and designated financial institutions permitted by the RBI to conduct all forms of current and capital account foreign exchange transactions.

Authorized Dealer Category II

Entities like travel agents and hotels authorized by the RBI to handle specified, non-trade forex operations such as remittances and travel expenses.

Fixed Income Money Market and Derivatives Association of India (FIMMDA)

An industry association establishing trading standards, codes of conduct, and daily price benchmarks for India's money, debt, and derivative markets.

Foreign Exchange Dealers' Association of India (FEDAI)

An association formed in 1958 to regulate, set standards for, and coordinate inter-bank foreign exchange activities among authorized dealer banks.

Insurance Regulatory and Development Authority of India (IRDAI)

An autonomous regulatory body created under the IRDA Act, 1999, to oversee, promote, and protect policyholders in the Indian insurance industry.

Insurance Agents

Licensed intermediaries who directly represent specific insurance providers to market and sell their dedicated insurance products to clients.

Insurance Brokers

Independent professional intermediaries representing policyholders who assess individual risk profiles and arrange coverage across multiple insurance carriers.

Securities and Exchange Board of India (SEBI)

The primary regulatory authority established in 1988 and given statutory powers under the SEBI Act, 1992, to protect investors and regulate securities markets.

Insolvency and Bankruptcy Board of India (IBBI)

The regulatory authority established under the Insolvency and Bankruptcy Code, 2016, overseeing insolvency professionals, utilities, and corporate resolution.

Corporate Insolvency Resolution Process (CIRP)

A formal framework under the IBC for restructuring distressed corporate entities, generally slated for completion within 180 to 270 days.

Information Utilities (IUs)

Regulated entities under the IBBI that collect, authenticate, and provide accessible financial data essential for bankruptcy and resolution proceedings.

Pension Fund Regulatory and Development Authority (PFRDA)

The statutory body established in 2003 and governed by the PFRDA Act, 2013, to regulate and develop India's structured pension sector.

National Pension System (NPS)

A voluntary, government-backed defined contribution pension scheme regulated by the PFRDA for Indian citizens aged 18 to 70.

NPS Tier I Account

The non-withdrawable mandatory pension account under NPS providing tax deduction benefits up to Rs. 2 lakhs annually under Section 80CCD.

NPS Tier II Account

A voluntary savings facility within the NPS that permits unrestricted withdrawals at any time without qualifying for tax incentives.

Point of Presence (PoPs)

Authorized entities serving as the initial interface for subscribers to open, service, and register accounts under the National Pension System.

Central Recordkeeping Agency (CRA)

The designated institutional entity responsible for central administration, data storage, and recordkeeping of subscriber accounts under the NPS.

Annuity Service Providers (ASPs)

Financial entities responsible for delivering regular post-retirement pension payments purchased with a minimum of 40% of accumulated NPS corpus wealth.