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Created by : Dinesh Raghav, Pre-Press Executive, Eli Research  | 06 11 2009 07:57:28 +0000
Industry : BankingFunctional Area : India(Markets)
Activity:  49751 views;  last activity : 02 18 2014 17:49:44 +0000

Which would you prefer to bank with, a NATIONALIZED BANK or a PRIVATE SECTOR BANK.

 
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NATIONALIZED BANK Vs PRIVATE SECTOR BANK
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Top Argument
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I am an ex-employee of Syndicate Bank and KSFC.  I left Syndicate Bank in 1991 and till today, except few years when I was working at Chennai, I have practiced as a Project Finance Consultant.  My banking experience is therefore around 22 years.  

I agree that private sector banks are technology oriented.  What exactly is technology?  Internal accounts are computerized (CBS?) of not only private sector banks but also public sector banks.  Everyone offers internet banking.  Everyone now offers RTGS.  I am not happy about all the three - RTGS, CBS and Internet Banking - the way it is implemented but the fact remains that these facilities are available in both public and private sector.

The discussion therefore should focus on what we wish to do in a bank:

  • Cash collection : I know of many nationalilzed banks who also collect cash.  Nationalized banks also have cash management services.  It is basically the bank staff who are either cooperative or hostile
  • Loans : Private banks have loan products.  If you meet the checklilst, your work is done.  public sector banks are yet to take that route.  Alternatively, if you have a good manager, you are in safest hands.
  • Temporary facilities : Private sector banks can not just deviate from the loan product.  This is a big handicap with them
  • Share trading and loan against shares : The biggest danger in a private bank is their margin requirements.  They are ruthless at times.  If you dont meet the margin requirement, they may even sell it.  You can perhaps reason with a public sector bank manager.
ICICI and HDFC were both public sector banks catering to a different segment.  They started banking business thats all.  


By SR Sham Sunder, CEO/MD/Director Technoaid  06 11 2009 13:44:15 +0000
 
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I think the choice should be based on one’s needs. Private sector banks are well managed and when considering modern facilities nationalized banks are no bets. I am a student from Kerala and here only private sector banks offer credit card facility while some universities of India accept fee payment through credit card only.

Definitely private sector banks offer better service, but at a cost. The hidden charges of private sector banks are almost double and charge heavily on services like drawing draft. Private banks in India don’t entertain small customers and even use heavy service charges as a filter tool. So if quality matters, go for private.

Other than this I think there is no point in differentiating based on risk. Private sector banks are also well regulated by the RBI and many private sector banks have better risk management than their public counterparts. I have an account in a public sector bank with an average monthly balance of around  Rs 1000 with atm facility, which is not possible in case of private.  But for you all with bank balance in lakhs and little time to spent, private is a better option.  


By Padmanabhan R, Articled / Audit assistant, Finance student  06 28 2009 20:13:16 +0000
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PAKKA MADARCHOD
By hhvhjjhbvvcgvh , Freelancer, Chemicals  | 02 18 2014 17:50:42 +0000
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@ pankaj kumar jha-->If u have so many problems in UBI, then why not you resigned from the job?Working in a PSB,and vote for a private bank-you people are simply treacherous.Let me tell you one thing-either private or public sector,you people don't be satisfied in any sector.Every organization have some pros and cons.When you get a job in that organization,you have to accept both good as well as bad things. UBI is one the best banks in our country.Lots of working people in TCS,CTS,INFY skipped from IT to banking now a days.But the people like you will never get satisfied with his/her job throughout his/her life.


By tanmoy , B.Tech/B.E. student, wbut  | 02 14 2014 14:11:57 +0000
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i support nationalized banks always
By tanmoy , B.Tech/B.E. student, wbut  | 09 13 2012 02:26:18 +0000
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nationalized banks are mainly responsible for the economic development of the country.private banks mainly for the elite class people of the country.according to our finance ministry info almost 74% share of this private banks like icici,hdfc are foreign shares.this banks have no gurrantee to survive longer if recession period comes again.private banks are beautiful from outside.their service charges,minimum amount to open a savings etc are really high than a government bank.....by charging this higher rates they gain profit.the outside glamour of private banks is no longer alive.
By tanmoy , B.Tech/B.E. student, wbut  | 06 13 2011 17:37:58 +0000
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I support Nationalised banks, even though they are little slow in their approach and not so Hi-tech programmed, they are traditional in nature, they trust in customer relations, know your customer norms, strictly adhere to the RBI Norms, some of the issues like motivating the staff, empowering the staff are concerned, it is surly the private sector is faaaaaaaaaaaaaaar ahead of the nationalised banks no doubt about it, it is high time and also better to update the staffs and employees of nationalised and public sector banks to the required standards and competance?


By Dr. S.Pruthviraja pande, Visiting Professor, Bangalore/Ravenshaw University  | 12 27 2009 07:27:31 +0000
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As I mentioned earlier that now a days PSBs are also updating their ambieance, technology and promptness. For eg if you visit BOB or SBI they look more sophisticated than Private Sector banks. Further to this as I have felt most pvt sector bank are adopting measures for Cost Cutting (Low Cost ATm 'Non AC', Non urbane branches will not have power back up..etc) which will surely decrease their glamour.

Apart from these all regarding Promptness of Response : Public Sector Banks may be a little late but you will find uniformity in response on the otherhand Pvt Sector bank may respond promptly but you will find discrepancy in responses given by two different branches.

So i still cheer for Nationalisation....


By Bhupesh Saxena, National Account Manager, Kotak Mahindra Bank  | 10 15 2009 12:03:31 +0000
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Heard of choice between "Devil and Deep sea"?


By Raguraman Bashyam, Principal Architect, Tech Mahindra  | 10 15 2009 07:12:26 +0000
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Nationalised Banks are in far better position than Private Bank.

  • Low Cost of Funds
  • Huge Customer Base
  • Consumer Trust

Due to above factors Nationalised banks are in better position to offer cheaper services & when someone think of bank he thinks of money, be it depositing cash, withdrawing cash, cheques, loans, forex business or Trade activities so its obivious Nationalised Banks are better. However laking is of willingness. Private Banks can not provide low cost service since they dont have funds to back it, they can only grow if they offer better services thats the place Nationalised Banks are a little failure. But now a days if you comapare Nationalised Banks have shown willingness to prove themself. SBI is now offering all services that too online, be it equity trading, insurance or normal banking services.

So cheers for Nationalisation..


By Bhupesh Saxena, National Account Manager, Kotak Mahindra Bank  | 09 15 2009 12:48:27 +0000
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I agree with Bhupesh.


By Atul Kumar, `Confidential, Confidential  | 09 15 2009 12:41:42 +0000
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I would prefer a nationalized bank. Banking is an industry where security of money plays an improtant role with accessibility. Nationalized banks like SBI, Canara Bank, PNB etc. have developed these well. Private has gone for beautifying the sites and pioneering of technics. Anyway same facilities would be given by nationalized banks sooner or later.

Moreover, if we take a housing loan from private bank, say, if you wish to take a copy of your original documents after a month or so, it would take about a week or a month in case of private bank. Whereas in nationalized bank, the documents would be available immediately then and there itself. This is because, the loan in a private bank is outsoursed and in nationalized bank, its by the branch itself by grant from head office.

In private banks, newer and newer rules are applied which are favourable for rich class people only, but nationalized banks focuses on average nationals. like - some private banks slap penalties if you approach a bank for more than 3 times in a month. etc. etc.


By taranath joshi, DGM Operations, EOL,  | 08 27 2009 16:52:44 +0000
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I would faour antionalized bank:-

1. Larger coverage

2. Competitive and upgraded services services as Pvt. Banks

3. Less risk factor (Accountability of Govt.) Safe investment

4. Fare customer practices

5. Cost effective (Default charges, Min. Balance, Cheque book, transaction fee etc)

6. Competitive Technological advancement

7. Changing mindset of working staff


By Nagpal Singh, Sales and Business Development, Babel Group of companies  | 08 27 2009 14:07:32 +0000
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Hi Devi,

You are wrong that there is only one Nationalised banks. We have number of Nationalised banks in India. They are also very Tech Savvy and have fast reach than any Private Banks. Our country is far bigger than few developed countires and Indians are more money savvy nature for future. Thats why Banking in India is growing as rapid spead. Private banks have brought the compition on the services offer and the way customers are served. Now the nationalised banks has come on par with them.


By Atul Kumar, `Confidential, Confidential  | 08 27 2009 07:27:06 +0000
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I am in favor of nationalized banking system. This is the best way to protect the interest of mass of common people and provide the required financial support to the nation. The major points which make if different from Private Banks:

1. Money if safe for common low earning people. This is top most important for nation like India where people are iof savy nature of their hard earn money. A protection is needed. In UK, all money deposited in any bank is safe upto 15000 pounds. Indian government should take such steps to protect the money of common man from any froud/bank failure.

2. Nationalised banks invest money mostly in India/national project only. They are not very profit oriented. They are more committed to the national society than Private Banks.

3. Now the time has changed and most of the Nationalised banks are also Tech Savvy which helped them to server customers more friendly.

4. Natinalised banks have far better reach to remote people than any Private Banks.

5. Nationalised banks are accountable and government is involved to make sure they don't faoul play with people money. Private Banks can easly cheat people and run away with their money. Poor control by RBI and government.

There are many other things which make them a better choice than Private Banks. They needs to more tech savvy and people friendly.

 


By Atul Kumar, `Confidential, Confidential  | 08 27 2009 07:23:14 +0000
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As a common user, I prefer Nationalised bank like SBI. No matter private sector banks gives more returns and interest including better services than SBI, still risk is more there. When money is considered, I don't take risk. There have been cases where users faced a lot of problem with private sector banks and complined different kind of complains like money loss. Also Nationalise bank's ATMs are more easily available than private one's.


By Anagha Thakur, Corporate Lawyer  | 08 19 2009 13:59:16 +0000
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Hello sir,

I agree with you in every word of yours. What one can think in hard times? In the phase of recession it was the nationalized Banks who took the initiative to lower down the Interest rates followed by the Private banks.

As far as the services are concerned Nationalised banks are a step back, but they still manage.

Banking is not only business its relationship. Whether small or big clients, Nationalized Banks never discourage.

One thing most of the population hates is the Loan processing time in Nationalised Banks. well they are more regulated and so precaution is necessary rather than creating NPA's.


By Rahul Gupta, Auditor, V S Kankariya & Co  | 08 11 2009 15:19:37 +0000
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I appreciate your spirit, Devi.  

Some time before, a small clash started between drivers of two vehicles in MG Road at Bangalore.  A third person was noting down both vehicle numbers.  No one bothered.  However, the passenger of one of the cars, a foreigner, rushed to the person noting down the vehicle number and demanded why is he noting it down?

Most people outside India are very sensitive about law, adherence and violations.  To an extent, Indians are thick-skinned.  

I request all those in India to understand Devi and have an answer before confronting her with a thumbs down!!


By SR Sham Sunder, CEO/MD/Director Technoaid  | 06 30 2009 09:57:53 +0000
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I go along with with the PSU banks because we all know that banking is all about relations.

In private banks the employees churning is very high and so whwn you open an account, there is a different employee and later a new one, while in the PSU the employees have a long term commitment, ahich us useful to the bank and the cuatomers...


By Japan Shah, Founder & Managing Director, JMS ADVISORY SERVICES PRIVATE LIMITED  | 06 29 2009 04:00:40 +0000
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I agree with Sham Sunder's detailed & analytical view point and Samad for his views on service & security. Most peoplem, me included, rushed to the private and foreign banks. But after so many years, I find the standards of these private banks falling and on the other hand, the public sector banks seem to be shaping up well. Most of their processes are well in place and so is their technology implementation. Once they get their customer service systems in place, I forsee a lot of customers going back to public sector banks.. me included.

If you have ever taken a home loan or a car loan you will appreciate the transperancy of a public sector bank, and also even though if one has never taken a car loan, he could still get beaten up by the goons of these private banks, just because some of their over-worked staff made a mistake. Is that efficiency or customer care? While on the surface they may seem to offer better service, but you are more likely to get stone-walled in a private bank than a public bank.


By Ajay Wadhwa, CTO/CIO, PCCPL  | 06 28 2009 17:04:28 +0000
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ya


By Pranav Jain, B.Com student, M.G.M School, Vadodara  | 11 28 2013 06:05:38 +0000
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ya i support private bank
By Pranav Jain, B.Com student, M.G.M School, Vadodara  | 11 28 2013 06:04:32 +0000
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I am working in Union bank of India.Friends we are talking about every resources that a bank have like technology,capital,etc.But we are missing one important resource that is human resource.In PSU bank work is not divided rationally among staffs,poor floor management,transfer are not transparent and there is no meritocracy.High performing staffs gradually demotivated and either leave the bank or work like a bada babu in typical govt departments.I am MBA finance from a premier institute and looking towards for the very first opportunity i'll get outside.More or less this is the case with all the professionals i met in my bank.So. now the question is how can an organization run professionally without professionals in the long term?
By pankaj kr jha, Assistant manager, Union Bank of India  | 10 06 2013 16:50:00 +0000
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NATIONAL BANKS ARE MORE CHEATING THAN PRIVATE SECTOR BANKS. AS THE PRIVATE SECTOR BANKS EXPLAINS ABOUT THE PENALTIES BEFORE THE ACCOUNT OPENINGS AND THEY INFORM US BY LETTER OR BY MAIL BUT THE NATINAL BANKS THEY WONT EXPLAIN ANYTHING THEY DECIDE HOW EVER THEY WANT WE ARE FACING THIS TYPE OF PROBLEM FROM INDIAN BANK THEY ARE VERY BIG CHEATERS THE MANAGERS AND RECOVERY OFFICERS ONLY SEE FOR THEIR PROMOTIONS
By LOKI1984 , INCHARGE, Services  | 03 20 2013 04:22:11 +0000
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I work with a PSU Bank but learnt many new edge approaches from the Private counter-parts .. !! Do know that both may not be combined as "ownersip issue" matters a lot.

Yes, ownership matters but may not PSU Banks learn from Pvt. Banks and vice-versa ? May Pvt. Banks adopt more ethical business practices than to garner profit and more profit ? May PSU Banks learn how to be a bit more customer oriented ?


By ASOKE KUSARI, Domestic Private Banking-Executive/Manager, A large leading PSU Bank - India  | 01 05 2010 17:10:38 +0000
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Atul I think you are mistaken. You live in India and I in Guyana. Our comment would definitely be different.


By Devi Kaladeen, Audit Manager, Health Sector Development Unit  | 10 15 2009 16:04:52 +0000
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If I would go for banking then definitely go for Private Sectors banks becuase the services & response provided by Private Banks compare to COMMERCIAL BANKS. If we enter any of the Private Sector Bank we feel High value & respect in the premises compare to COMMERCIAL BANKS.

Services provided by Private Banks are very efficient & prompt for the customers.


By prakashraj kumavat, MBA/PGDM student, Omegan School of Business (ICFAI Tripura)  | 09 09 2009 07:34:35 +0000
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Having moved from working in a nationalised Bank to a Private sector Bank, I vouc for the huge difference between  the cultures of the two. I abide by private sector banks anytime not because i left working for PSU but for the wayPrivate players are functioning against time tested odds to gain biger market share andthrough sher hardwork, and the attitude to serve are posting bigger and bigger profits. As a layman I would always prefer to walk into a private sector bank for investments/ financial needs than a PSU wherein I mightbe asked to come later. Having worked in a PSU, when I wanted to open a simle savings a/c with one of it's branches in Mumbai I was harassed by the term introduction even after the submission of KYC documents, PAN Card and address proof. I was asked to get the introduction from a certain neighbour working inh the same bank branch and staying in the sam building, it was pathetic and i swore never , even for old time's sake, ever deal with a PSU. It's wake up r Close up time for the PSUs with the zillions of us getting more aware and more tech savvy.


By Smitha Gopal, Admin/Facilities Manager, AXIS Bank  | 08 19 2009 13:34:04 +0000
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the working of  private sector bank is very aggressive and goes with the senario of what we need in todays fast moving life. Under one roof we can grab the oppournities to have all the financial problen sort out with hardly getting any problem in it.


By harsh ranjan sharan, Cust. Service Executive, IDBI Bank  | 07 22 2009 14:25:12 +0000
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private bank if your looking for fast service,but security comes in matter i perfer nationlized banks


By samad , Sales Executive/Officer, Vijaya Bank  | 06 28 2009 06:51:06 +0000
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I have no choice but to bank with the private sector bank. My country is very small and there is only one national bank which do not have commercial facilities. However, all the privately owned banks have the modern conveniences.


By Devi Kaladeen, Audit Manager, Health Sector Development Unit  | 06 11 2009 20:08:48 +0000
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Time Oriented results if any error occurs

Customer support teams are good in private banks


By Paresh.Khanchandani , FCD Business Manager, ExxonMobil Company India Private Ltd.  | 06 11 2009 13:24:29 +0000
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The public sector bank employees have a callous attitude towards customers. Our only hope is that they will change their processes after if they continually lose a good amount of business to private sector banks. So we must take our business only to private sector banks and hope that public sector banks get the hint.


By Shahnawaz Islam, PR & Media Relations Manager, National Institute of Smart Governance  | 06 11 2009 12:06:30 +0000
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I would like to bank with Private Sector Banks for the following reasons.

1. The service provided by the private banks is far better than the nationalised banks.

2. Quick and satisfactory replies to your queries then you get in the nationalised bank.\

3. The private banks are fully technology oriented which makes the work easier and faster, whereas most of the branches of nationalised banks are still to have a taste of technology.

4. As due to over competition the bargaining power order of clients increases whereas the nationalised banks does'nt care about retaining the clients, I can say this from my personal experience with SBI.

5. Young staff in private banks who are quick and agressive compared to the aged staff in nationalised banks who are rather slow. For instance when you go to withdraw or deposit cash in nationalised banks the time they take lot of time for accepting or giving cash even with the counting machines with in that time in a pvt bank employee would have paid to 3 customers.


By Darshil , CEO/MD/Director, Darshil Cotton Company  | 06 11 2009 10:02:56 +0000
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In this computer age, nationalized banks are far away behind the Private sector banks. Still they are struggling to automate their processes. But is the large customer support they have gained before private sector banks entering the banking segment which make them going till now.

No doubt, we pay for the services private banks provide. But in new terminology we can say "A BANK is a friend Indeed when we are in need". ATMs and online transactions have made life easy for the people of this computer age.

ICICI Bank and HDFC Bank are the best example to describe the development of the Private Sector Banks in India. They stand almost next to the biggest nationalized bank of India that is STATE BANK OF INDIA. In a short span of time they have the biggest customer base.

Therefore, I would rather prefer to go with private sector bank instead of a nationalized bank.


By Dinesh Raghav, Pre-Press Executive, Eli Research  | 06 11 2009 07:57:28 +0000
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