PRIVATE SECTOR BANK

The private-sector banks in India represent part of the Indian Banking

Sector that is made up of both private and public sector banks. The "private-
sector banks" are banks where greater parts of stake or equity are held by the private
shareholders and not by government. Banking in India has been dominated by public
sector banks since the 1969 when all major banks were nationalised by the Indian
government. However since liberalisation in government banking policy in 1990s, old
and new private sector banks have re-emerged. They have grown faster and bigger over
the two decades since liberalisation using the latest technology, providing
contemporary innovations and monetary tools and techniques.
The private sector banks are split into two groups by financial regulators in
India, old and new. The old private sector banks existed prior to the nationalisation in
1969 and kept their independence because they were either too small or specialist to be
included in nationalisation. The new private sector banks are those that have gained
their banking license since the liberalisation in the 1990s.
Private sector banks are owned by the private lenders. The private banks are
also managed and controlled by private promoters and these promoters are free to
operate according to the market forces. The interest rates of private banks are generally
slight costly as compared to public sector banks. Banking has been originated in the
form of private banking. Generally, the private banks are looked as a large organization
with global operations. A private bank may have retail banking facilities for their
clients. They are known for better customer services and investment opportunities.
Shareholders of the private banks generally seek short-term profits as their highest
priority. The private banks are known for being well equipped with all kinds of
contemporary tools and techniques.
Government holds a major share in public sector banks and thus, important
decisions are made by the government. The decisions are generally in the interest of the
public. Their main aim is to carry out the banking activities that cater to all the sections
of the society. On the other hand, a private bank mainly focuses on short term interest.
These banks do not have much interference of the government but at the same time
these banks lack the administrative support of the government. To sustain in the
competitive banking sector, the private sector banks have been using the best and latest
software's.
Today you can find lots of foreign bank that are engaged to serve the customers
in the best possible manner and made its stand strong by offering 24 x 7 hour service.
Private banks in India have a great history and started their service way back. In 1920s,
imperial bank of India formed by the great cooperation by Bank of Madras, Bank of
Bengal and Bank of Bombay. After that Reserve Bank of India came into existence in
1935 and got authority to look after the other banks.
It became centre body and got power to introduce making policy and several
new schemes. After the establishment of Reserve Bank of India, the Imperial Bank of
India was blessed with new identity and became popular as State Bank of India.
In 1969 the Government of India offered a new ordinance and approx 14
commercial banks got certification of nationalized banks. Some of them were Central
Bank of India, Allahabad Bank, Punjab National Bank and Canra Bank.
In 1994, the Reserve Bank of India opened the door for private banks and
handed out the policy to control the private banks. The policy also included the
liberation for Private Banks in terms of their free and independent operation. The first
private bank came in India as Trust Bank later it became popular as Oriental Bank of
Commerce.
After that Housing Development Finance Corporation limited that got consent
from Reserve Bank of India. It became a large private bank and still popular for
offering wonderful service. Today India is a swamped with many private banks such as
International Bank, ING Vyasya Bank, Kotak Mahindra Bank, SBI Commercial Bank,
Karnataka Bank, Kashmir Bank, ICICI Bank and more. Private Banks in India achieved
a milestone for serving people and showed its great commitment. Private Banks in
India have earned great response for its skin tight service and also known for bringing
revolution for serving millions of customers.
It offers best option for saving and also offers various schemes with maximum
return. It offers its service 24 hours and made the job of fund transfer easier by offering
new banking service. Besides, there are lots of ATM machines have been set up by such
private banks and made the task of withdrawing liquid money easier.