Rutuja Pathare, LLB, MIT WPU Faculty of Law, Pune
What is the meaning of ‘Banking’, ‘Bank’ and a ‘Banker’?
The term ‘Banker’ should be simplified as a person, company or a firm portraying itself as a ‘bank’ or ‘banker’ in its description and every such company accepting deposits of money, subject to withdrawal by order, cheque or draft.
Section 3 of the Negotiable Instruments Act, 1881 defines ‘Banker’ as, “banker includes any person acting as a banker and any post office savings bank”.
The term ‘Banker’ is defined under Section 7(1) of The Banking Regulations Act, 1949 as, “No company other than a banking company shall use as part of its name [or, in connection with its business] any of the words "bank", "banker" or "banking" and no company shall carry on the business of banking in India unless it uses as part of its name at least one of such words.” Section 5(b) of The Banking Regulation Act, 1949 defines ‘banking’ as, “banking” means the accepting, for the purpose of lending or investment, of deposits of money from the public, repayable on demand or otherwise, and withdrawal by cheque, draft, order or otherwise”
Section 5(c) of The Banking regulations Act, 1949 defines ‘Banking Company’ as, “banking company means any company which transacts the business of banking”.
