India currently has 12 nationalised banks operating under government ownership. These banks play a crucial role in the country’s banking sector by serving millions of customers and supporting various government schemes.
Nationalised banks in India were created to ensure financial inclusion and stability. They hold a significant market share and contribute to economic growth by offering services across urban and rural areas.
Understanding the number of nationalised banks helps clarify the structure of India’s banking system. This knowledge is essential for anyone interested in finance, economics, or the nation’s development.
What Are Nationalised Banks in India
Nationalised banks are financial institutions owned and operated by the government to serve public interest. They play a vital role in India’s economic development through widespread banking services and financial inclusion.
Definition and Meaning
Nationalised banks in India are banks whose ownership and management have been taken over by the government. Typically, this means the central government holds a majority stake in these banks. The main aim is to control and regulate banking services for better reach to rural and underbanked populations.
These banks follow government policies related to priority sector lending and rural development. They operate under regulatory frameworks such as those set by the Reserve Bank of India (RBI). Currently, there are 12 nationalised banks in India, each contributing toward the country’s financial stability.
History of Bank Nationalisation
Bank nationalisation in India began in 1969, when Prime Minister Indira Gandhi’s government decided to nationalise 14 major private banks. The objective was to ensure that banking facilities expanded beyond urban centers. A second round happened in 1980, adding six more banks to the nationalised list.
The move was aimed at aligning banks with national development goals. It made credit accessible to sectors such as agriculture, small industries, and exports. Since then, these banks have been key players in implementing government schemes like Direct Benefit Transfer (DBT), where subsidies are directly credited to beneficiaries’ accounts.
Objectives of Nationalisation
The main objective is to promote inclusive growth by ensuring easy access to banking services. Nationalised banks focus on financial inclusion, especially for rural and underserved communities. They support government programs by delivering credit to priority sectors like agriculture and micro, small, and medium enterprises (MSMEs).
Another goal is to maintain economic stability by regulating credit flow and controlling monetary policy implementation. Nationalised banks also help reduce regional imbalances by operating extensive branch networks domestically. Their role in schemes like DBT exemplifies the government’s push for transparent, efficient subsidy delivery.
List of Nationalised Banks in India
India’s banking sector includes several nationalised banks that play a key role in the economy. These banks are government-owned and serve a wide range of customers across urban and rural areas.
Current Number of Nationalised Banks
As of 2025, India has 12 nationalised banks. This number reflects mergers and consolidations aimed at strengthening the banking system. The government originally nationalised 20 banks in 1969 and 6 more in 1980, but mergers have reduced the total.
The count of 12 includes banks that serve various customer segments, from retail to corporate. The banks operate under government ownership to promote financial inclusion and economic development.
Names of Nationalised Banks
The 12 nationalised banks are:
- State Bank of India (technically an associate but treated as a major nationalised bank)
- Punjab National Bank
- Bank of Baroda
- Canara Bank
- Union Bank of India
- Indian Bank
- Central Bank of India
- Bank of India
- Indian Overseas Bank
- UCO Bank
- Punjab & Sind Bank
- Bank of Maharashtra
These banks have wide branch networks and significant market presence in both rural and urban India. They follow government guidelines on priority sector lending and social banking mandates.
Major Features of Nationalised Banks
Nationalised banks in India operate under specific frameworks that define their ownership and service structures. Their operations reflect government control as well as customer-centric features that cater to diverse banking needs.
Government Ownership
Nationalised banks in India are primarily owned and controlled by the government, ensuring public interest is prioritized. The government holds the majority stake, influencing key policy decisions and governance. This ownership structure aims to promote financial inclusion and support economic growth.
Examples include Canara Bank and Bank of Baroda, where government ownership means greater stability and regulatory oversight compared to private banks. This also ensures these banks follow government schemes and lending policies, often focusing on priority sectors like agriculture and small businesses.
Customer Services
Customer services in nationalised banks emphasize accessibility, reliability, and convenience. They offer multiple channels for basic inquiries such as balance checking through mobile apps, internet banking, and SMS alerts.
For example, to check a Canara Bank balance, customers can use the bank’s mobile banking app or send an SMS to a designated number. Similarly, Bank of Baroda and Union Bank provide USSD codes and internet banking platforms to facilitate easy balance checks and transaction monitoring.
These banks also provide robust customer support, including branch services, call centers, and digital assistance, ensuring clients receive timely help for various banking needs.
Differences Between Nationalised Banks and Other Banks
Nationalised banks differ notably from private and regional rural banks in ownership, regulatory control, and operational scope. These differences affect service delivery, customer experience, and accessibility, especially in rural and semi-urban areas.
Nationalised vs Private Sector Banks
Nationalised banks are owned and operated by the government, which controls the majority stake. They follow stricter government regulations and focus extensively on financial inclusion and priority sector lending.
Private sector banks are owned by private entities and shareholders. They emphasize technology adoption, quicker service delivery, and profit maximization. Nationalised banks generally have a wider reach in rural areas, while private banks concentrate on urban and metro regions.
For example, closing an Axis Bank account or Axis Bank credit card involves online or branch procedures designed for convenience, reflecting private banks’ user-focused model. Conversely, closing an HDFC Bank account online is streamlined but may require more documentation due to regulatory compliance typical of private banks.
Nationalised vs Regional Rural Banks
Regional Rural Banks (RRBs) are hybrid entities with joint ownership by the central government, state government, and sponsoring nationalised banks. Their primary purpose is rural development and providing credit to agriculture and small industries.
Nationalised banks serve both urban and rural customers but maintain a broader service range, including retail, corporate, and priority sectors. RRBs focus intensely on localized rural needs and operate largely in specific regions.
RRBs generally have limited technology integration compared to nationalised banks, which have invested in digital services. Finding a customer ID or managing transactions is easier with nationalised banks like HDFC or Axis, which provide robust online banking platforms.
Roles and Functions of Nationalised Banks
Nationalised banks serve key functions aimed at supporting economic growth and social equity in India. They extend credit to important sectors and act as conduits for government financial schemes, ensuring inclusive development and targeted delivery of benefits.
Support to Priority Sectors
Nationalised banks prioritize lending to agriculture, micro and small enterprises, education, and housing. These sectors are vital for employment generation and economic stability but often lack adequate finance from private banks.
By allocating a fixed percentage of their total advances to priority sectors, these banks help improve rural incomes and infrastructure. They provide affordable loans to farmers for seeds, equipment, and irrigation, which increases agricultural productivity.
Similarly, support to micro and small enterprises fosters entrepreneurship and local industry. The banks also offer education and housing loans at concessional rates, facilitating social upliftment in underserved communities.
Implementation of Government Schemes
Nationalised banks are primary agents for implementing government schemes like Direct Benefit Transfer (DBT). DBT leverages banks to transfer subsidies and financial assistance directly into beneficiaries’ accounts, reducing leakages and delays.
They also manage schemes such as the Pradhan Mantri Jan Dhan Yojana for financial inclusion and Mudra loans for small business funding. Banks verify beneficiaries, disburse funds, and monitor usage to ensure transparency.
In this role, nationalised banks act as critical links between the government and citizens, promoting efficient and accountable delivery of welfare programs. Their extensive branch network helps reach remote areas where private banks may not operate.
Merger and Consolidation of Nationalised Banks
India’s nationalised banks have undergone significant reorganisation to improve efficiency, competitiveness, and financial stability. These changes have affected the total number of such banks and reshaped the banking landscape.
Recent Mergers
In 2020, the Government of India announced the merger of 10 public sector banks into four larger entities. This reduced the number of nationalised banks from 27 to 12. Key examples include:
- Punjab National Bank merged with Oriental Bank of Commerce and United Bank of India.
- Canara Bank absorbed Syndicate Bank.
- Union Bank of India merged with Andhra Bank and Corporation Bank.
- Indian Bank merged with Allahabad Bank.
This consolidation aimed to create stronger banks with better capital bases and wider outreach. It also sought to reduce duplication of resources and improve operational efficiency.
Impact of Consolidation
The consolidation has led to larger banks with improved capacity to finance big projects and compete internationally. It has also resulted in cost savings through reduced branch overlaps and streamlined management.
However, integration challenges remain, such as harmonising IT systems and staff adjustments. Customer service and branch accessibility have generally been maintained or improved.
The overall effect is a more robust and competitive nationalised banking sector, bringing the total count of these banks in India to 12 as of 2025.
Regulation and Governance
Nationalised banks in India operate under strict regulatory frameworks designed to ensure financial stability and protect depositors. These frameworks involve roles shared between central banking authorities and government bodies.
Role of Reserve Bank of India
The Reserve Bank of India (RBI) acts as the primary regulatory authority for nationalised banks. It sets guidelines on capital adequacy, lending limits, and asset classification to maintain banking standards.
RBI also monitors liquidity through tools like the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR). It conducts regular inspections and audits to ensure compliance with prudential norms.
In addition, RBI manages monetary policy tightening or easing by influencing interest rates, directly impacting the operations of nationalised banks. It also oversees the implementation of financial inclusion initiatives to extend banking services across India.
Government Oversight
The Government of India owns nationalised banks and exercises significant control through the Ministry of Finance. It appoints key personnel such as Chairpersons and Directors, influencing bank governance and strategic decisions.
Policy directives issued by the government include credit targets for priority sectors like agriculture and MSMEs (Micro, Small, and Medium Enterprises). These directives support social and economic goals alongside commercial banking activities.
The government provides capital infusion when required to strengthen the banks’ financial health. Parliamentary committees periodically review bank performance to ensure accountability and transparency within these institutions.
Banking Operations and Customer Services in Nationalised Banks
Nationalised banks in India provide a range of basic and advanced services to manage accounts and support transactions. They also offer digital banking tools designed to improve convenience, security, and accessibility for customers.
Account Management
Nationalised banks like SBI, Canara Bank, Bank of Baroda, and Union Bank offer multiple account types, including savings, current, recurring deposit, and fixed deposit accounts. Customers can open accounts both physically at branches and online.
Linking Aadhaar to bank accounts such as SBI is essential for direct benefit transfers and simplifies KYC processes. For example, to link Aadhaar with an SBI account, the customer can visit the bank branch or use SBI’s net banking and mobile app facilities.
Checking balances typically varies by bank but involves simple steps. Canara Bank customers can check balance via USSD codes or mobile apps. Bank of Baroda offers SMS banking and missed call services for balance inquiry. Union Bank users can access balance information through their mobile app or net banking portals.
Digital Banking Facilities
Digital banking is a major focus across nationalised banks, with mobile apps, internet banking, and unified payment interfaces frequently available. Many banks provide real-time fund transfers through NEFT, RTGS, and IMPS on digital platforms.
Security features like two-factor authentication and biometric login are standard. These tools protect customer data and reduce fraud risks. Bank of Baroda and Union Bank mobile apps support multiple languages and include services such as bill payment, fund transfers, and e-statements.
The introduction of Aadhaar-based e-KYC has sped up digital account opening and onboarding. Customers can also set alerts for transactions and customize services according to their needs across all these banks. These digital channels significantly reduce the need for branch visits while enhancing customer experience.
Career Opportunities in Nationalised Banks
Nationalised banks in India offer a variety of career paths with stable growth and benefits. Employees can enter at different levels, from clerical roles to officer positions, each with specific responsibilities and promotion criteria.
How to Become a Bank Manager
To become a bank manager in a nationalised bank, one usually starts as a Probationary Officer (PO). Candidates must clear competitive exams like the IBPS PO or SBI PO, which test reasoning, quantitative aptitude, and English skills.
After selection, the candidate undergoes training and gains experience in various banking operations. Promotion to manager depends on performance, seniority, and further exams or assessments within the bank.
Skills such as leadership, decision-making, customer service, and knowledge of banking regulations are essential. A bachelor’s degree is typically required, with preference for commerce, finance, or economics backgrounds.
Banking Holidays and Working Days for Nationalised Banks
Nationalised banks in India follow a specific calendar for holidays and working days. These banks observe national public holidays, festival days, and select Saturdays off, which can vary by region and bank.
Which Saturdays Are Bank Holidays
Nationalised banks remain closed on the 2nd and 4th Saturdays of each month in most states. The 1st, 3rd, and 5th Saturdays are usually working days unless declared holidays by the bank or state government.
However, some states may treat all Saturdays as holidays, especially during festive periods or for local observances. It is essential to check the official bank holiday calendar issued annually by the Reserve Bank of India and the specific bank for exact dates.
Banks also close on weekends if coinciding with public holidays or special bank holidays announced for important events.