. Definition of Private Sector Bank Banks whose greater part of the equity is held by private shareholders and entities rather than government is known as private sector banks. This is in line with their primary value of maximising profit. Additional Benefits: Employees are also offered special benefits including higher rate of interest on fixed deposits and paid holidays among other things. There… 7613 Words 31 Pages Department of Economics 9-1-2004 Productivity Growth and Efficiency in Indian Banking: A Comparison of Public, Private, and Foreign Banks T. You can pre-pay any amount which you like. Conclusion To make a choice of career is not a simple decision as there are a number of complex factors to be considered and balanced against each other.
The importance of public accountability Accountability differs largely between public and private organisations. A nationalized bank is formed by taking a bank and its assets into the public ownership. These include large banks like State Bank of India and Punjab National Bank. Obviously, they are loosing interest money if they allow you to prepay. However, other retirement benefits like gratuity, etc. Are you encouraged by an honourable desire to serve the public? However, a success cannot be guaranteed that nationalization of banks will always be a successful act.
For instance, nearly 40 lakh applications were received for approximately 80,000 government bank jobs in 2013. The decisions are generally in the interest of the public. As such, they are much more prevalent than private sector banks in rural areas and low-income urban districts. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. In the public sector, however, limits are applied to awarding high performance. A public sector bank is a bank that is operated through institutions owned by the people through their representative governments. Depending on the role, skills sets could vary but as we have already discussed, those who believe in instant recognition and performance-based rewards should opt for a career in private banking.
This is exactly what happened in the wake of 2008 meltdown when thousands of private bank employees were shown the door. Candidates should have a good knowledge of finance, accounting, banking practices and excellent communications skills as a public banker. This difference in scope constitutes the first and fundamental distinction between public and private management, from which a number of differences arise. New Cabinet Secretaries frequently replace significant numbers of senior leadership in their first year. Private Sector Banks vs Public Sector Banks — Conceptual Differences Private Banks: Private sector banks are usually known for their highly competitive outlook and technological superiority. Spending on a program is not equivalent to progress. It aimed at giving more credit to sectors that required to be prioritized.
Private Banks have not right to intersect with other outside country means govt. The difference is that in public management, political processes ensure that leadership changes frequently, while in private organisations, individuals can stay in leadership positions for an indefinite number of years. In nationalized banks the government controls the bank. Work-Life Balance: Private banks are relatively worse on this count with longer and intense working hours which tends to affect the balance between work and personal life. They encompass multiple programs and their success is measured by the overall betterment of society. Usually, in public sector banks, government holdings are more than 50 per cent.
So the productivity of the employees along with time and their enthusiasm for taking on newer challenges and delivering well reduces with time. The young generation always prefers private banks whereas our parents would always guide us to get it from a public sector bank. About the Author Zach Lazzari is a freelance writer with extensive experience in startups and digital advertising. Job security is one of the most important advantages with public sector banks as rarely anyone is laid off, except for disciplinary reasons. Smaller tenure loans do not hurt much but for home loans, where the tenure is generally 20 years, you should take great care for the above mentioned points.
Public sector banks are the banks owned by the government of India or are an undertaking of the government of India. Commercial banks are joint-stock banks. Fast-Paced Career Growth: Professionals can grow at a fast pace and acquire higher positions along with greater emoluments within the first few years. Despite all the professed advantages of a public banking career, clearing the exam hurdle can prove to be a really tough nut to crack. France had nationalized its banking sector, and later the government sold it to private hands. Private sectors manage and control these banks.