One of the most asked questions about Union Bank of India is about its market share. It’s a good practice to know about it before opening an account in the bank or even after using the banking services for some time.
Before you know if Union Bank is Private or government, it’s important to understand the difference.
What is the Difference between Private and Government banks?
In India, the banking sector is largely divided into public and private sector banks. The key difference lies in the equity. For public sector (or Government) banks, more than 50% of the equity is owned by the Government of India. On the other hand, private banks are owned, operated, and regulated by private companies or people. The majority of the equity is owned by private shareholders and only a small percentage is owned by the government.
Is Union Bank of India a Government Bank?
Union Bank of India is a significant public sector bank listed on Indian stock exchanges. According to the 2022-23 annual report, the government owns 83.49% of the bank’s total share capital. Founded in 1919, this institute has a long history of supporting stakeholders.
Interestingly, Mahatma Gandhi inaugurated the bank’s corporate office. Back in 1947, the bank had four branches: three in Mumbai and one in Saurashtra (now Gujrat). By 1969, the Indian government had nationalized the UBIN, which had 240 branches. Now, this count is around 660.
Advantages of Union Bank as a Government Bank
As a customer (or would-be customer) of Union Bank of India, it is important to know the key benefits of a public sector bank. Here are the following:
- The primary goal is to provide financial services to the general population of India while also implementing government objectives.
- Profitability is crucial, but social welfare and financial inclusion are taken care of with equal or more importance.
- Government policies have a strong influence, and companies may be obligated to comply with these plans and directives. For example, financial inclusion initiatives and priority sector financing.
- Union Bank of India is the first large public sector bank that implemented 100% core banking solutions for its customers.
Conclusion
Currently, there are 12 government banks in India and Union Bank is one of them. As a public sector bank, it has multiple advantages. In this article, all the information related to public sector banks and their advantages are clarified.