Banking Awareness

Private Sector Banks in India – All you need to know

Private Sector Banks in India
Private Sector Banks in India
Written by Sainath Nuvvula

what is private sector bank?

Private Sector Banks in India Private Sector Banks in India plays a major role in Financial Inclusion. This Article will give you the clear insights about 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:

S No PUBLIC SECTOR BANKSPRIVATE SECTOR BANKS
1The ownership of the Public Sector Banks are the banks lies with the government.The ownership of the Private Sector Banks is held by the individuals and corporations.
2There are 27 Public Sector BanksThere are 21 Private Sector Banks
3The interest rate on deposits is usually highThe interest rate on deposits is marginally lower
4Market Share 72.9%Market Share 19.7%
5The customer base is very highThe customer base is comparatively low
6Job security is therePurely based on performance
7The pension is thereNo Pension

Private Indian Banks

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

S NoPrivate Indian BanksHeadquartersTagline
01Axis Bank MumbaiEverything is the same except the name
02Bandhan Bank Kolkata Aapka Bhala, Sabki Bhalai
03Catholic Syrian Bank ErnakulamSupport all the way
04City Union Bank KumbakonamTrust and Excellence
05Development Credit Bank Mumbai –
06Dhanalakshmi Bank Thrissur
07Federal Bank AluvaYour Perfect Banking Partner
08HDFC Bank MumbaiWe Understand your World
09ICICI Bank MumbaiHum Hai Na
10IndusInd Bank  MumbaiWe Make You Feel Richer
11IDFC Bank Mumbai Banking Hatke
12Jammu & Kashmir Bank Sri NagarServing to Empower
13Karnataka Bank MangaloreYour family bank across India
14Karur Vysya Bank KarurSmart Way to Bank
15Kotak Mahindra Bank  MumbaiLet’s make money simple
16Lakshmi Vilas Bank ChennaiThe Changing Face of Prosperity
17Nainital Bank NainitalBanking with a personal touch
18Ratnakar Bank Mumbai –
19South Indian Bank ThrissurExperience Next Generation Banking
20Tamil Nadu Mercantile Bank Tuticorin
21YES Bank Ltd  MumbaiExperience our Expertise

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:

S. NoLocal Area BanksContiguous DistrictsHeadquarters
22Coastal Local Area Bank LimitedKrishna, Guntur and West Godavari Vijayawada in Andhra Pradesh
23Krishna Bhima Samruddhi Local Area Bank LimitedMahbubnagar in Andhra Pradesh and Raichur and Gulbarga in Karnataka Mahbubnagar, Andhra Pradesh
24Capital Local Area Bank Ltd.Kapurthala, Hoshiarpur and Jalandhar Phagwara, Punjab.

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:

S. NoSmall Finance BanksHeadquartersTagline
25Au Small Finance Bank Limited Rajasthan (Jaipur) Chalo Aage Badhe
26Capital Small Finance Bank Limited Punjab (Jalandhar)
27FINCARE Small Finance Bank Limited Gujarat (Ahmedabad)
28Equitas Small Finance Bank Limited Tamilnadu (Chennai) Its Fun Banking
29ESAF Small Finance Bank Limited Thrissur (Kerala) Joy of Banking
30Suryoday Small Finance Bank Limited Maharastra (Navi Mumbai) A Bank of Smiles
31Ujjivan Small Finance Bank Limited Karnataka (Bengaluru) Bharosa, Aap ke Bharose Par
32Utkarsh Small Finance Bank Limited Uttarpradesh(Varanasi) Aapki ummed Ka kata
33North East Small Finance Bank Limited Assam (Guwahati) Your Door Step Banker

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:

S. NoPayments BanksHeadquarters
34Airtel Payments Bank Limited New Delhi
35 India Post Payments Bank Limited –
36Fino Payments Bank Limited Mumbai
37Paytm Payments Bank Limited New Delhi

Private Foreign Banks

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

S NoForeign BanksCountry of Incorporation
01Australia and New Zealand Banking Group Ltd.Australia
02Commonwealth Bank of AustraliaAustralia
03National Australia BankAustralia
04Westpac Banking CorporationAustralia
05Bank of Bahrain & Kuwait BSCBahrain
06AB Bank Ltd.Bangladesh
07Sonali Bank Ltd.Bangladesh
08KBC Bank NVBelgium
09Bank of Nova ScotiaCanada
10Industrial & Commercial Bank of China Ltd.China
11BNP ParibasFrance
12Credit Agricole Corporate & Investment BankFrance
13Societe GeneraleFrance
14Deutsche BankGermany
15HSBC LtdHong Kong
16Bank Internasional IndonesiaIndonesia
17Mizuho Bank Ltd.Japan
18Sumitomo Mitsui Banking CorporationJapan
19The Bank of Tokyo- Mitsubishi UFJ, Ltd.Japan
20SBM Bank(Mauritius) LtdMauritius
21Rabobank InternationalNetherlands
22The Royal Bank of Scotland N.V.Scotland
23Doha BankQatar
24JSC VTB BankRussia
25SberbankRussia
26DBS Bank Ltd.Singapore
27United Overseas Bank LtdSingapore
28FirstRand Bank LtdSouth Africa
29Shinhan BankSouth Korea
30Woori BankSouth Korea
31Korea Exchange BankSouth Korea
32Industrial Bank of KoreaSouth Korea
33Bank of CeylonSri Lanka
34Credit Suisse A.GSwitzerland
35UBS AGSwitzerland
36CTBC Bank Co., Ltd.Taiwan
37Krung Thai Bank Public Co. Ltd.Thailand
38Abu Dhabi Commercial Bank Ltd.UAE
39Mashreq Bank PSCUAE
40National Bank of Abu Dhabi PJSCUAE
41Barclays Bank Plc.United Kingdom
42Standard Chartered BankUnited Kingdom
43American Express Banking CorporationUSA
44Bank of AmericaUSA
45Citibank N.A.USA
46J.P. Morgan Chase Bank N.A.USA

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 2017

S NoPrivate Banks in IndiaMarket Capitalization (Rs. Crore)
01HDFC Bank475,442.46
02ICICI Bank199,278.83
03Kotak Mahindra192,094.99
04Axis Bank130,064.95
05IndusInd Bank100,121.25
06YES Bank71,481.28
07RBL Bank21,342.58
08Federal Bank21,332.05
09IDFC Bank18,236.44
10City Union Bank11,836.38

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Sainath Nuvvula is a Digital Marketing Expert and Consultant from Bangalore, India. He is a big thinker and a Tech Enthusiast. Can ring him @ +91 – 9535745456

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