Is IDBI Bank Private or Government?

IDBI bank was founded by the Government of India under the Industrial Development Bank of India Act of 1964. The full form of IDBI stands for the same as the Industrial Development Bank of India. However, now this bank is categorised as a private sector bank. It doesn’t come under the list of nationalised or public banks of India.

There can be some confusion for the customers regarding this change. This article will provide all the necessary information you need to know about IDBI Bank.

Was IDBI Bank a Government Bank?

The answer is yes. IDBI Bank was a public sector bank. Initially, it was founded to support the industrial growth of India financially. For 40 long years, it was operated as a public sector bank with headquarters in Maharashtra. Some major areas where the government IDBI bank contributed are as follows:

1. Played an important role in providing funding for major industrial projects like infrastructure, steel, and electricity.
2. The development and backing of numerous financial organizations, including the NSE, NSDL, and SEBI, were made possible in large part by IDBI.
3. Contributed to the growth of venture capital in India by endorsing risk-taking and inventive enterprises.
4. Was a government advisor on development plans and industrial policies. furthermore encouraged R&D initiatives across a range of industries to boost innovation and competitiveness.
5. Developed training facilities and curriculums to produce skilled people for the banking and industrial industries.
6. IDBI played a key role in the marketing of bonds, debentures, and equity instruments as well as the growth of India’s financial markets.
7. Funded several important infrastructure projects, such as power plants, ports, and highways, all of which are essential for the expansion of industry.

Is IDBI Bank Private Now?

The government retained control of IDBI even after it was renamed IDBI Bank Limited, a commercial bank, in 2004. Post this, the Indian government gradually reduced its stake in IDBI Bank.

The acquisition of a 51% controlling stake in IDBI Bank by the Life Insurance Corporation of India (LIC) in January 2019 marked a significant shift. Because of this transaction, IDBI Bank was reclassified as a private-sector bank. This is because LIC is a government-owned company that runs without direct government oversight.

Now that it’s a private bank, what are the major benefits you’ll get as a customer? Get a wide range of financial products, such as credit cards, investment options, fixed deposits, recurring deposits, savings and current accounts, and loans (personal, home, car, etc.).

Appealing interest rates on savings and fixed deposit accounts, as well as competitive rates on a range of credit options. Experience innovative technology-driven services like contactless payments, digital wallets, and AI-powered financial advice, a full range of digital banking services including online banking, mobile banking, etc.

After United Western Bank (with its headquarters in Satara) was acquired by IDBI Bank in 2006, IDBI Bank increased the number of its branches from 195 to 425.

And most importantly, IDBI Bank offers valuable interest rates on loans against your LIC insurance as collateral. Get exclusive offers and discounts on these plans placed through IDBI Bank networks. You can set up automatic payments for premiums from your IDBI Bank account to ensure timely payments and prevent insurance lapses. Also, banking and insurance services from one platform are accessible. So you may avoid the need to deal with various service providers.

Conclusion

Life Insurance Corporation (LIC), IDBI Bank’s largest stakeholder, owns more than 49 per cent of the company, with the government owning the remaining 45.5%. As per the recent news, the privatisation plan includes selling 60.7% of the bank. This would include the government’s 30.5% holding with LIC’s 30.2% share. With all these arrangements, the customers can avail better financial opportunities and compete with other private banks in India. As a customer, get the latest updates and plan your finances accordingly.