Letter to BS: Nationalised banks mobilised savings of the poor for 50 years

Bank branches have taken root in every nook and corner of the country

Nationalised banks are in the headlines for the wrong reasons these days. However, these banks are now headed for their golden jubilee. It was on July 19, 1969, by means of an Ordinance, that the Indira Gandhi-led Congress government nationalised 14 commercial banks primarily due to two reasons.

The first was the unpredictable manner in which these functioned as private entities. There were 361 private banks which failed between 1947 and 1955, translating to an average of over 40 banks per year resulting in depositors losing all their money. Second, these were seen as catering to large industries and