Banking System

Introduction At the time of Independence, India had a fairly well-developed banking outline with much than 345 banks having more than 4800 branch offices. These banks although developed but they could non conform to social needs of the society. These banks generally catered to the needs of industries and as well giving once. Other priority sectors like agriculture, small master industries, exports etc., were to the highest degree neglected. To overcome these deficiencies, the Government announced the nationalisation of 14 study commercial-grade bank with effect from July, 1969. The objectives of nationalisation were to mark the senior high school of the economy and to meet more and more the needs of development of the economy, in conformity with national indemnity and objectives. Six more banks were nationalised in 1980. (Two banks were merged in 1993, so at present on that point ar 19 nationalised banks). Nationalisation of Commercial Bank The follo wing factors are trusty for nationalisation of commercial banks in 1969. 1. Private willpower of commercial banks and absorption of economic power Until nationalisation, all major(ip)(ip) banks were controlled by integrity or more short letter house. These business houses use the resources contributed by the mass of the people for their own private benefits.

They financed those projects which in the long run enhanced their own financial resources.Thus, private willpower of banks resulted in meanness of income and wealth in few hands. 2. Urban- bias approach to nationalisation, commercial banks had shown no interest in establishing offi ces in semi-urban and unlearned areas. Mor! e and more branches were opened in cities resulting in concentration of banking facilities in urban areas. For example, out of about 5.6 lakh villages in India, only 5000 were being served by commercial banks and five major cities (Ahemdabad, Bombay, Calcutta, Delhi, and Madras) together had one seventh share in single-valued function of bank offices and about fifty percent...If you want to get a full essay, order it on our website: OrderEssay.net

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