Government-owned scheduled commercial banks not only provide tremendous comfort level to depositors but also render services effectively. Examine (200 Words)
Refer - Business Line
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Manish 3 years
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IAS Parliament 3 years
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IAS Parliament 3 years
KEY POINTS
· Privatising one or two banks, due to various reasons, is quite different from privatising a major chunk of public sector banks.
· Already we have substantial presence of new generation private sector banks which are giving enough competition to the government banks.
· The major problem faced by banks is on account of non-performing assets, which is common for both the private and public sector banks.
· The government may also have difficulty in providing additional capital to the government banks on account of fiscal constraint and the banks are in need of additional capital to maintain Capital Adequacy Ratio for continuing their lending operations.
· The 1,926 town cooperative banks in 2004 have shrunk to 1,551 in 2018, as per an RBI report.
· Banks owned by sovereign government provides tremendous comfort level to depositors.
· Attempting to privatise all banks is simply undermining the tremendous contribution of these banks to the country over the years.
· The nationalisation of private banks in 1969 resulted in the opening of tens of thousands of branches in remote corners of the country.
· But state-owned banks, while trying to be profitable on the one hand, provide many services in public interest. Only government banks provide services to the common people at affordable cost.
ANIL KUMAR RAM 3 years
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IAS Parliament 3 years
Try to include some advantages of public sector banks. Keep Writing.
