Private Sector Banks in India – Private Sector Banks in India plays a major role in Financial Inclusion. This Article will give you clear insights into Private Banks, Local Area Banks, Small Banks, Payment Banks, and Foreign Banks.

Introduction to Private Sector Banks in India:

The Indian Banking System comprises two major sectors of Banks. i.e. Public and Private Sector Banks. The former is controlled by the Government and the latter’s share or equity are held by private shareholders. The Private Sector Banks in India are divided into two groups. They are Old Private Sector Banks and New Private Sector Banks.

• Old Private Sector Banks existed prior to the nationalization in 1969 and kept their independence because they were either too small or specialist to be included in nationalization.
• The new private sector banks are those that have gained their banking license since the liberalization in the 1990s.

Difference between Public and Private Sector Banks in India:

Private Indian Banks

List of Private Sector Banks in India and their headquarters / Tagline:

Local Area Banks

What are Local Area Banks?

• The Local Area Bank Scheme was introduced in August 1996 pursuant to the announcement of the then Finance Minister.
• LABs were set up to enable the mobilization of rural savings by local institutions and, at the same time, to make them available for investments in the local areas. i.e., primarily in rural and semi-urban areas, comprising three contiguous districts.
• LABs were required to have a minimum capital of Rs. 5 crores.

Complete List of Local Area Banks and their Headquarters with Contiguous Districts:

Small Finance Banks

What are Small Finance Banks?

• Small Finance Banks mainly focus and serve the needs of a certain demographic segment of the population.
• The minimum paid-up capital of such banks is Rs. 100 crores
• The aim is to provide financial inclusion to sections of the economy not being served by other banks. Those sections include small business units, small and marginal farmers, micro and small industries and unorganised sector entities.

Complete List of Small Finance Banks and their Headquarters / Taglines:

Payment Banks

What are Payment Banks?

• Payments banks is a new model of banks conceptualized by the Reserve Bank of India (RBI).
• These banks can accept a restricted deposit, which is currently limited to ₹1 lakh per customer and may be increased further.
• These banks cannot issue loans and credit cards. Both current account and savings accounts can be operated by such banks.

Complete List of Payment Banks and their Headquarters / Taglines:

Private Foreign Banks

Complete List of Private Foreign Banks and their Country of Incorporation:

Frequently Asked Questions :

How many Indian Private Sector Banks are there?

As per the data from Reserve Bank of India’s Official Website, there are 21 Private Indian Banks.

Who gives License to Private Sector Banks in India?

Reserve Bank of India. The bank shall have a minimum net worth of 500 crore rupees at all times.

What are the Top Ten Private Sector Banks in India in terms of Market Capitalization?

Top Ten Ranking As of December 2023

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