Why Did Public Sector Bank Mergers in India Happening?
It’s easier to count the number of stars in the sky than counting the number of public sector banks in India. There are so many! State Bank of India, Punjab National Bank, Bank of Baroda, Dena Bank, Allahabad bank, Bank of India and the list goes on. In order to create “NextGen Banks”, the present finance minister of India, Ms. Nirmala Sitharaman on behalf of the finance ministry, has decided to merge 10 public sector banks into four. This decision is a result to give more boost to public sector banks by having more control over them. Some, not so popular public sector banks, were not so adaptive on the technology front, because of which many Indian customers were having difficulties. Following are the reasons behind the merger strategy:
Efficiency in Operations: It is difficult for the government to manage so many public sector banks. Managing a lot of banks increases the cost due to which operations becomes very difficult. More manpower will be required to continue the operations. To sum it up in one sentence, it is wise to say - Too many cooks spoil the broth.
Better Governance: It’s difficult for one body to keep an eye on the operations of so many public sector banks. Earlier, the government was struggling with lot of NPA (Non-Performing Assets). And, this was creating a lot of financial crisis for India. Now, with 10 public sector bank mergers in India, the government will keep a stern eye on these matters.
Better Customer Service: Due to the above mentioned issues, banks were having a tough time in retaining customers. Some public sector banks were not available in remote locations due to which customers were having a lot of inconvenience. A customer, located in a remote are, was unable to go on with their banking transactions due to unavailability of good service. With merger bank now, people can effectively open a bank account or transfer money, anytime and anywhere.
Technological advancements: Only the top public sector banks were able to afford to provide novel banking technology to their customers. Rest other banks were struggling to service their customers on the technology front due to availability of funds and losses faced by them. This was resulting in widespread customer despair.
Which Merger Bank has come across as a Shocking News?
One of the most shocking news that came to my notice was the meger bank of Oriental Bank of Commerce and United Bank with Punjab National Bank. It is shocking but it is for the greater good. A merger with a profitable bank will ensure the balance sheet of the merged banks are expected to improve. And, for Punjab National Bank, it means more customers coming their way.
Public Sector Bank Mergers in India - that Happened!
In this segment, I will tell you about the public sector bank mergers that happened in India. After reading this, be ready to strike off some your banks forever from your brain. RIP. Andhra Bank and Corporation Bank will be merged with Union Bank. Punjab National Bank will have two banks under its name - Oriental Bank of Commerce and United Bank of India. Syndicate Bank Bank will be absorbed by Canara Bank. Allahabad Bank will join hands with Indian Bank. These were some few bank mergers in India, that’s going to happen. To know more about merger bank, you can head to the website of some financial technology companies.
Efficiency in Operations: It is difficult for the government to manage so many public sector banks. Managing a lot of banks increases the cost due to which operations becomes very difficult. More manpower will be required to continue the operations. To sum it up in one sentence, it is wise to say - Too many cooks spoil the broth.
Better Governance: It’s difficult for one body to keep an eye on the operations of so many public sector banks. Earlier, the government was struggling with lot of NPA (Non-Performing Assets). And, this was creating a lot of financial crisis for India. Now, with 10 public sector bank mergers in India, the government will keep a stern eye on these matters.
Better Customer Service: Due to the above mentioned issues, banks were having a tough time in retaining customers. Some public sector banks were not available in remote locations due to which customers were having a lot of inconvenience. A customer, located in a remote are, was unable to go on with their banking transactions due to unavailability of good service. With merger bank now, people can effectively open a bank account or transfer money, anytime and anywhere.
Technological advancements: Only the top public sector banks were able to afford to provide novel banking technology to their customers. Rest other banks were struggling to service their customers on the technology front due to availability of funds and losses faced by them. This was resulting in widespread customer despair.
Which Merger Bank has come across as a Shocking News?
One of the most shocking news that came to my notice was the meger bank of Oriental Bank of Commerce and United Bank with Punjab National Bank. It is shocking but it is for the greater good. A merger with a profitable bank will ensure the balance sheet of the merged banks are expected to improve. And, for Punjab National Bank, it means more customers coming their way.
Public Sector Bank Mergers in India - that Happened!
In this segment, I will tell you about the public sector bank mergers that happened in India. After reading this, be ready to strike off some your banks forever from your brain. RIP. Andhra Bank and Corporation Bank will be merged with Union Bank. Punjab National Bank will have two banks under its name - Oriental Bank of Commerce and United Bank of India. Syndicate Bank Bank will be absorbed by Canara Bank. Allahabad Bank will join hands with Indian Bank. These were some few bank mergers in India, that’s going to happen. To know more about merger bank, you can head to the website of some financial technology companies.
Comments
Post a Comment