India is governed by many banking laws and regulations. Some of them are:

1) The Reserve Bank of India Act, 1934: This act along with the Indian Companies Act, 2002 provides a framework for all banking firms in India. This act covers all functions and powers of the RBI. Section 42 talks about the regulation of the Cash Reserve Ratio and Section 18 talks about the discounting of Bills of
Exchange. Other than these two sections, no other sections deal with the regulation of the Banking system in the entire act.

2) Banking Regulation Act, 1949: This Act is concerned with providing guidelines to the bank. Guidelines are with regards to deposits repayable on demand, cheques, drafts, order etc. It also prohibits certain activities, such as trading of goods, prohibiting banks from holding any immovable property etc.

3) Prevention of Money Laundering Act, 2002 (PMLA): Laundering is the process of acquiring, owning, transferring any proceeds of money related to
crime or being involved in such transactions with the knowledge of where these proceeds come from. PMLA prevents such money laundering and hols that anyone involved in such kind of proceeds is guilty of offences. Like these acts there are many more acts which are related to banking laws and regulations.
The Banking Laws in India has evolved tremendously in the last two centuries. The decision to set up Reserve Bank of India was a landmark event in the evolution of banking laws and regulations in India. This happened in the year 1934. The other major events involve, nationalisation of 14 largest
commercial banks in the year 1969 through the Banking Companies (Acquisition and Transfer Undertakings) Ordinance, 1969 and the other was merging of another 4 banks and at this point, 90% of the banks were controlled by the Government of India. Due to all these changes and the evolution, India’s economy and financial conditions is far better than those of other countries across the world.