Banking in India in the modern sense originated towards the end of the 18th century. The still existing oldest bank in India is the State Bank of India. India’s Partition in 1947 after Independence adversely impacted India’s economy paralyzing banking activities for months. The Government of India initiated measures to play an active role in the economic life of the nation, and the industrial policy resolution ushered in by the Government in 1948 envisaged a mixed economy. This resulted into greater involvement of the state in different segments of the economy including banking and finance.

An ordinance was issued in 1969 and 14 largest commercial banks were nationalized. These banks contained 85 percent of bank deposits in the country. Six more commercial banks were nationalized in 1980. The stated reason for the nationalization was to give the government more control of credit delivery. In the early 1990s, under its policy of privatization and liberalization, the Government issued licences to some private banks. These came to be known as new generation tech-savvy banks. This move, along with the rapid growth in the economy of India, revitalized the banking sector in India, which has seen rapid growth with strong contribution from all the three types of banks, namely, government banks, private banks and foreign banks.

The new policies that are obtaining in banks in India have discarded much of what may be called traditional style of functioning. There are extended hours of work and public dealing in the banks these days. Through the CBS system, a group of networked branches provide core banking services to the customers. The new developments have ushered in a modern outlook and tech-savvy methods of working for traditional banks. All this has led to a retail boom in India. People have not just demanded more from their banks but also received more.