Page 40 - Banking Finance February 2022

ARTICLE

PRIVATISATION

OF PSBS A NEW

PANACEA

T he country is going through a discussion about their business decisions. There is also difference in incentives

privatisation of PSBs and Government is
than their private counterparts which can motivate them
to do better. But here we have to understand the goals for
vigorously pulling up for the same. There are two
type of thoughts involved one in favour and
another against it, Those in favour are giving several logics which these banks were nationalized i.e. to transfer
economic prosperity to untouched masses, to serve the
like PSBs are saddled with NPAs, PSBs are in dual control unserved.
one by RBI through RBI Act 1934 and one by Finance
Ministry By BR Act 1949. So at times Governments through The Concept behind Nationalization:
their ministries use PSBs as a tool to further their political
On 19th July 1969 14 Scheduled Commercial Banks were
gains.
privatised having aggregate deposit of approx. Rs 50K
crores. The major purpose for the same was to make banking
PSBs don't have sufficient Autonomy so they are weak in
services accessible to the last person in the society. Since
then Banks have served their purpose in form of Rapid
About the author economic development, to lower the problem of un
employment, making banking services accessible to small
Brijesh Kumar Shukla and marginal farmers, helping small traders and artisans
Chief Manager (Faculty) like weavers. Making the banking service reach to the man
Union Bank Of India clutched in the hand of moneylenders in short, meeting the
STC Hyderabad
goals of financial inclusion.

40 | 2022 | FEBRUARY | BANKING FINANCE