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    The document summarizes the nationalization of banks in India. It explains that in 1969, Prime Minister Indira Gandhi nationalized 14 major private banks that had deposits over 50 crore rupees in order to ensure that banks worked for the development of the nation rather than private gain. It then lists the banks that were nationalized in 1969 and 1980. The reasons given for nationalization were that private banks created monopolies and neglected priority sectors like farmers and small industries. The advantages listed are equal distribution of credit, expanding banking services to rural areas, and fostering new entrepreneurs. The disadvantages mentioned are political interference, overstaffing, and lack of competition and regulation in nationalized banks.

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    31978400-National-vs-Private-Banking-in-India

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    The document summarizes the nationalization of banks in India. It explains that in 1969, Prime Minister Indira Gandhi nationalized 14 major private banks that had deposits over 50 crore rupees in order to ensure that banks worked for the development of the nation rather than private gain. It then lists the banks that were nationalized in 1969 and 1980. The reasons given for nationalization were that private banks created monopolies and neglected priority sectors like farmers and small industries. The advantages listed are equal distribution of credit, expanding banking services to rural areas, and fostering new entrepreneurs. The disadvantages mentioned are political interference, overstaffing, and lack of competition and regulation in nationalized banks.

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    48 views8 pages

    Nationalization Merits & Demerits

    Uploaded by

    kwin_shah2010
    The document summarizes the nationalization of banks in India. It explains that in 1969, Prime Minister Indira Gandhi nationalized 14 major private banks that had deposits over 50 crore rupees in order to ensure that banks worked for the development of the nation rather than private gain. It then lists the banks that were nationalized in 1969 and 1980. The reasons given for nationalization were that private banks created monopolies and neglected priority sectors like farmers and small industries. The advantages listed are equal distribution of credit, expanding banking services to rural areas, and fostering new entrepreneurs. The disadvantages mentioned are political interference, overstaffing, and lack of competition and regulation in nationalized banks.

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    of 8

    BANK

    Nationalization

    Merits & Demerits


    Nationalization of Banks
     Banks which are managed and controlled by the
    government are nationalized bank.
     These banks work according to norms of RBI.
     Earlier banks were in the hands of private owners
    who were high earners of the society. This
    situation was before 1969.
     This was observed by the then prime minister
    Indira Gandhi in 1969. She thought that these
    banks were not working for development of nation.
    So she thought of taking over banks into
    government undertaking.
     Banking System in India is dominated by
    Nationalized bank.
     1955: Nationalization of State Bank of India.

     1960: Nationalization of 7 SBI subsidiaries.

     July 19-1969: Nationalization of 14 major


    banks with deposit of over 50cr.

     1980: Nationalization of seven banks with


    deposits over 200cr.
    Nationalized Banks
     Allahabad Bank  Syndicate Bank
     Andhra Bank  UCO Bank
     Bank of Baroda  Union Bank of India
     Bank of India  United Bank of India
     Bank of Maharashtra  Vijaya Bank
     Canara Bank  Indian Overseas Bank
     Central Bank of India  Oriental Bank of Commerce
     Corporation Bank  Punjab and Sind Bank
     Dena Bank  Punjab National Bank
     Indian Bank
    Reason for Nationalization
     Commercial banks created monopoly in the country.

     The priority sector was neglected. Banks did not pay attention
    to credit needs to farmers, small scale industries.

     Bank credit was not made according to five year


    developmental plans.
    ADVANTAGES
     Equally distribution of bank credit.

     To make bank finance available for productive


    purposes in the priority sectors of the economy.
     To extend banking services in rural areas.
     To foster new class of entrepreneurs.

     Collection of Savings
    DISADVANTAGES
     Political interference

     State intervention

     Overstaffing

     Inadequate supervision and regulation

     Lack of Competition
    Thank You

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