Government Banks in India

Government or public-sector banks are banks where the majority, i.e. more than 50% of the stakes are held by the government. These banks are a major contributor to the country's economic growth.

You can apply for various loans, and credit cards, and open fixed deposits with such banks. You can also earn interest on funds parked in your savings bank accounts.

Also Read: Types of Bank Accounts

List of Public Sector Banks in India 2024

There are 12 government banks in India. They are mentioned below -

• State Bank of India

• Bank of Baroda

• Punjab National Bank

• Bank of India

• Union Bank of India

• Canara Bank

• Bank of Maharashtra

• Central Bank of India

• Indian Overseas bank

• Indian Bank

• UCO Bank

• Punjab and Sind Bank

Top 10 Government Banks in India

Below are certain features and contacts of some prominent government banks in India. 

1. Bank of Baroda

With a 63.97% ownership, the Indian government holds most of the stakes in Bank of Baroda. Here are some details about the bank -

Its attractive features include the following -

• The freshly released BoB World mobile app offers all banking services and products in a streamlined, trouble-free way. Customers can also save, invest, borrow, and buy from it.

• By facilitating account opening using video KYC, the software also benefits non-customers.

• The vision of the Bank of Baroda inspires confidence and security in its diversified client categories.

2. Bank of India

A group of prominent merchants from Mumbai, Maharashtra, India, created Bank of India. Before being nationalized alongside 13 other banks on July 19, 1969, the Bank of India was privately owned and operated. 

Some of its admirable characteristics are given below -

• The minimum balance requirement is zero for setting up an account.

• Processing fees for personal loans, home loans, and vehicle loans are waived to a 50% degree.

• Branches and internet banking both offer free RTGS and NEFT payment options.

• E-Pay Utility Bill Payment and Assisted Online ITR Filling on the Bank's Website.

• Existing tie-up partners provide health coverage and group term insurance.

Also Read: Best Banks in India

3. Central Bank of India

The first commercial bank in India to be entirely owned and run by Indians was the Central Bank of India, which opened its doors in 1911. In the year 1969, the Central Bank was officially nationalised.

The bank has launched various self-employment programs to encourage young adults with education to find jobs. Some of its highlighting features are as follows -

• Women entrepreneur cell: To locate, inspire, and help prospective women entrepreneurs launch a successful business.

• Door-to-door banking service

• Create a savings account using a video KYC

4. Canara Bank

Canara Bank saw extraordinary growth, particularly after being nationalized in 1969. The bank has developed a reputation for itself in commercial banking. 

It also has a reputation in several corporate social obligations, including advancing national goals, fostering rural development, boosting rural self-employment through many training institutions, and driving the cause of financial inclusion.

The bank has several notable characteristics, including the following -

• Anyone looking to buy or develop a home may take advantage of the appealing home financing programs offered by Canara Bank. 

• Four different forms of personal loans are provided by Canara Bank, meeting all of their clients' urgent financial needs at reasonable interest rates.

• Customers can obtain a loan against gold jewelry or gold coins utilizing the Swarna Loan or the Gold Loan provided by Canara Bank to cover medical or other expenditures.

Also Read: Private Banks in India

5. Union Bank of India

One of the nation's top public sector banks is the Union Bank of India. The Government of India owns 83.49% of the entire share capital. It is the first significant government bank in India to fully adopt a core banking system.

In honor of its expertise in innovation, banking services, financial inclusion, MSME, and human resource development, the Union Bank has won several accolades. Salient features include -

• Nari Shakti Product was created to support female businesses. The product is specifically made to finance businesses run by women entrepreneurs by loaning them the amount between Rs.2 Lakh and Rs.10 Lakh. 

• In comparison to owning gold physically, Sovereign Gold Bonds are a better option. Since the investor receives the current market value at the point of redemption or early redemption, the amount of gold they paid for is safeguarded. 

6. State Bank of India

The State Bank of India is among the most prominent government banks in India of all time.

Following the nationalization of the Imperial Bank of India, the State Bank of India was founded.

Some of its highlighting features in today’s era include the following -

• The bank has introduced the Positive Pay System (PPS) for all types of check payments per Reserve Bank of India guidelines. This is an effort to stop fraud committed using altered or tampered checks.

• The data on the device is printed using MICR technology, which utilizes a special form of magnetic ink. The machine reads the written information as soon as the instrument is inserted. The MICR method is advantageous because it reduces the likelihood of error, makes clearing checks simple, and speeds up money transfers.

7. Punjab National Bank

Punjab National Bank, one of the best government banks in India, started its operations from Lahore, with a total capital of Rs.2 Lakh and a working capital of Rs.20,000. 

Here are some things that make this bank a pioneer:

• Appointed auditors in 1895, when it was not mandatory to do so

• Was the first to introduce the "teller" system in 1944 

• Established profit-sharing bonuses, provident funds, and voluntary outside audits before they were mainstream 

• During 2008-09, PNB became the largest Nationalized Bank to bring all its branches and extension counters into the Core Banking Solution (CBS)

8. Indian Bank 

Indian Bank started its business with a capital of Rs.20 Lakh. By 1921, the bank’s capital was raised to Rs.60 Lakh. In 2024, the bank’s global business crossed Rs.12 Lakh Crore. 

Among the most notable services of the Indian Bank is the Central Bank Digital Currency or the CBDC. It is a legal tender issued digitally by the central bank.

9. Indian Overseas Bank 

IOB was founded with the main objective of specializing in foreign exchange business in banking. It was one of the 14 major banks to be nationalized in 1969. Now, it is present in 5 countries apart from India; i.e., Singapore, Hongkong, Thailand, Sri Lanka, and South Korea.

10. UCO Bank

After the Quit India movement of 1942, Mr. G.D. Birla conceived the idea of a truly Indian bank. The bank was nationalized by the Government of India on 19 July 1969. The government took 100% ownership of the bank and it was named the United Commercial Bank.

In 1985, by an Act of Parliament, the bank’s name was changed to UCO Bank.

Features of Best Government Banks in India

The Indian banking system consists of public and private sector banks, with government-owned banks being the largest players. Government banks in India are owned by the government and gain the maximum trust of its citizens.

Salient features of government banks include -

• They are responsible for providing loans, deposits, credit cards, insurance products, and other banking services to individuals as well as businesses.

• Government banks also offer various other services such as foreign exchange transactions, money transfers, and remittances.

• They also act as custodians of public funds and provide safekeeping for them.

• Government banks in India are subject to regulations imposed by the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), and other regulatory bodies. 

• They are also required to adhere to certain corporate governance and risk management standards.

Conclusion

Government banks in India also known as Public Service Banks or PSBs, owned and operated by the Indian government and regulated by the RBI are 12 in number. 

Since these banks have an extensive network of branches and ATMs throughout the country, they are highly accessible to the regular Indian. Thus, in recent years, the government has taken multiple initiatives to reform PSBs and enhance their financial health. 

Overall, these banks play a pivotal role in promoting financial inclusion and offering banking services to the unbanked and underbanked populations. 

In spite of these, there is a further requirement for reforms and improvements from the government’s end to ensure long-term sustainability and improved profitability of these government banks in India.