India, July 22 -- Nearly six decades ago, India experienced a significant transformation in its banking sector when the government nationalised 14 major private commercial banks. This was immediately followed by the Lead Bank Scheme and the introduction of priority sector lending.

The move aimed to democratise banking and extend credit to the unbanked, with these banks then accounting for about 85 per cent of the country's deposits.

A newly independent nation needed to align its financial architecture with nation-building, and this laid the foundation for what is now popularly known as financial inclusion.

A second round of nationalisation in the 1980s paved the way for the next round of initiatives, such as stricter Priority Sector Le...