Section 11: Requirement as to minimum paid-up capital and reserves.

Q: What does Section 11 of The Banking Regulation Act, 1949 (BR Act) deal with?

Section 11 BR Act pertains to "Requirement as to minimum paid-up capital and reserves.". It is part of the The Banking Regulation Act, 1949, a legislation enacted by the Parliament of India. Section 11 of The Banking Regulation Act, 1949 (BR Act) governs requirement as to minimum paid-up capital and reserves. As verified on 22 May 2026.

Q: Is Section 11 BR Act still in force?

Yes, Section 11 of the The Banking Regulation Act, 1949 is currently in force across the Republic of India.

Q: What is धारा 11 BR Act?

धारा 11 BR Act is the Devanagari Hindi reference for Section 11 of the The Banking Regulation Act, 1949. Section 11 of The Banking Regulation Act, 1949 (BR Act) governs requirement as to minimum paid-up capital and reserves. As verified on 22 May 2026.

Q: What is Dhara 11 BR Act?

Dhara 11 BR Act is the Roman Hindi reference for Section 11 of the The Banking Regulation Act, 1949. "Dhara" means "Section" in Hindi. Section 11 of The Banking Regulation Act, 1949 (BR Act) governs requirement as to minimum paid-up capital and reserves. As verified on 22 May 2026.

Q: How to cite Section 11 of The Banking Regulation Act, 1949?

Cite as: "Section 11, The Banking Regulation Act, 1949 (BR Act)" in legal briefs. For academic writing, use the BlueBook format: The Banking Regulation Act, 1949, 1949, § 11 (India).

Law on Tips Editorial Board

(1) Notwithstanding anything contained in 1[section 149 of the Companies Act, 1956 (1 of 1956)], no banking company in existence on the commencement of this Act, shall, after the expiry of three years from such commencement or of such further period not exceeding one year as the Reserve Bank, having regard to the interests of the depositors of the company, may think fit in any particular case to allow, carry on business 2[in India], and no other banking company shall after the commencement of this Act, commence or carry on business 2[in India], 3[unless it complies with such of the requirements of this section as are applicable to it].

4[(2) In the case of a banking company incorporated outside India—

Provided that any such banking company may at any time replace—

7[(2A) Notwithstanding anything contained in sub-section (2), the Central Government may, on the recommendation of the Reserve Bank, and having regard to the adequacy of the amounts already deposited and kept deposited by a banking company under sub-section (2), in relation to its deposit liabilities in India, declare by order in writing that the provisions of sub-clause (ii) of clause (b) of sub-section (2) shall not apply to such banking company for such period as may be specified in the order.]

(3) In the case of any banking company to which the provisions of sub-section (2) do not apply, the aggregate value of its paid-up capital and reserves shall not be less than—

Provided that no banking company to which this clause applies shall be required to have paidup capital and reserves exceeding an aggregated value of five lakhs of rupees:

Provided further that no banking company to which this clause applies and which has only one place of business shall be required to have paid-up capital and reserves exceeding an aggregate value of fifty thousand rupees:

8[Provided further that in the case of every banking company to which this clause applies and which commences banking business for the first time after the commencement of the Banking Companies (Amendment) Act, 1962 (36 of 1962), the value of its paid-up capital shall not be less than five lakhs of rupees;]

Provided that no banking company to which this clause applies shall be required to have paid-up capital and reserves exceeding an aggregate value of ten lakhs of rupees.

Explanation.—For the purposes of this sub-section, a place of business situated 9[in a State] other than that in which the principal place of business of the banking company is situated shall, if it is not more than twenty-five miles distant from such principal place of business, be deemed to be situated within the same State as such principal place of business.

(4) Any amount deposited and kept deposited with the Reserve Bank under 10*** sub-section (2) by any banking company incorporated 11[outside India] shall, in the event of the company ceasing for any reason to carry on banking business 12[in India], be an asset of the company on which the claims of all the creditors of the company 12[in India] shall be a first charge.

13[(5) For the purposes of this section,—

(6) If any dispute arises in computing the aggregate value of the paid-up capital and reserves of any banking company, a determination thereof by the Reserve Bank shall be final for the purposes of this section.1. Subs. by Act 95 of 1956, s. 14 and the Schedule, for "section 103 of the Indian Companies Act, 1913 (7 of 1913)" (w.e.f. 14-1-1957). 2. Subs. by Act 20 of 1950, s. 3, for "in any State " (w.e.f. 18-3-1950). 3. Subs. by Act 33 of 1959, s. 7, for certain words (w.e.f. 1-10- 1959). 4. Subs. by s. 7, ibid., for sub-section (2) (w.e.f. 1-10-1959). 6. The word "calendar " omitted by Act 66 of 1988, s. 7 (w.e.f. 30-12-1988). 7. Ins. by Act 36 of 1962, s. 2 (w.e.f. 16-9-1962). 8. Ins. by Act 36 of 1962, s. 2 (w.e.f. 16-9-1962). 9. Subs. by Act 62 of 1956, s. 2 and Sch., for "in India " (w.e.f. 1- 11-1956). 10. The words "the proviso to " omitted by Act 33 of 1959, s. 7 (w.e.f. 1-10-1959). 11. Subs. by Act 20 of 1950, s. 3, for "elsewhere than in a State " (w.e.f. 18-3-1950). 12. Subs. by s. 3, ibid., for "in the States "(w.e.f. 18-3-1950). 13. Subs. by Act 33 of 1959, s. 7, for sub-section (5) (w.e.f. 1-10- 1959).