In the year 1960, 35.6 lakh people of Jammu and Kashmir and Ladakh had deposited Rs 10.98 Crore in the banks. Six decades later, the population has increased by 3.42 times, while the bank deposits have grown by 13960%. In this edition of Deep Dive, we understand the history of banking in Jammu and Kashmir, and the finer nuances of where this money is coming from, which district parks more money in banks, the disparity between the Jammu region and Kashmir Valley.
The Early Banks
Like other parts of the pre-independence India, most banks in Jammu and Kashmir were also the indigenous banks which charged high interest rates. A few banks had their branches in a few towns of the princely state of Jammu and Kashmir. Lloyd Bank and Imperial Bank had branches in both Gulmarg and Srinagar, while Lahore based banks, Punjab and Kashmir Bank and Punjab National Bank had their branches in both Jammu and Srinagar. However, this was never enough to cater to the public.
By the mid-1930s, ruler of Jammu and Kashmir Maharaja Hari Singh wanted to open a local bank to enable access to formal banking for his subjects. It is learnt that Maharaja first requested Lala Harikshekn Lal, founder of Punjab National Bank for help, but was turned down by Lal, who found the idea as impractical.
Maharaja then sought guidance of Sir Sorabji Pochkanwala, founder of the Central Bank of India. The two deliberated on the practical aspects such as instituting it as fully-State or Private bank, before settling for ownership of both State and public in the bank, taking inspiration from other Princely States such as Baroda, Patiala, Indore etc. On October 1, 1938, Jammu & Kashmir Bank came into existence, and the bank commenced operations in July of 1939, six years before another local bank Federal Bank of Srinagar came into being, besides several other Cooperative banks.
Spread of Branches
Some of these banks had to be closed down, particularly after the partition. Post-independence, many new banks started their operations in Jammu and Kashmir. In 1973, there were 159 bank branches in the State, which grew to 809 in 2000. As on date, Jammu and Kashmir has around 2026 bank branches across 20 districts.
Of these 1045 bank branches are spread across the ten districts of Jammu region, with Jammu district home to highest 431 branches, and Kishtwar having lowest 31 branches.
The ten districts of Kashmir Valley house 981 bank branches, highest being 219 in Srinagar and 37 branches in Shopian, lowest in the region.
The number of ATMs in Jammu and Kashmir stand at 2635 in the entire Jammu and Kashmir, 1385 of them in Jammu region and 1250 in Kashmir Valley. Jammu district and Srinagar have 696 and 479 ATMs, highest in the two regions, respectively, while Shopian at 38, and Ramban at 37 have the lowest number of ATMs, respectively.
Rise in Deposits
In the year 1961, the total deposits in Jammu and Kashmir amounted to Rs 10.98 Crore. This rose to Rs 25.23 Crore in 1968, and by 1980, Rs 375 Crore were deposited in all banks across the state. In the next 20 years, the deposits rose to Rs 8657 Crore, and in the march of 2020, the amount had increased to Rs 128003 Crore.
As per the latest data, Rs 1.53 Lakh Crore are deposited in the scheduled commercial banks across the twenty districts of Jammu and Kashmir, translating into an average per capita deposit of Rs 1.24 Lakh.
Which district parks more money & Regional disparities
Each of the 15.29 lakh people of Jammu district have deposited around 3.5 lakh rupees on average in the banks, the highest in Jammu and Kashmir, while residents of Kupwara have Rs 32 thousand per person, as bank deposits, the lowest in the union territory.
Of the total Rs 1.53 Lakh Crore deposited in the deposits, the ten districts of Jammu region take the lead, contributing to around 59%, that is Rs 89,986 Crore.
Of these, Jammu district has a total deposits of Rs 53120 Crore, 34.65% of the entire deposits of Jammu and Kashmir, followed by Kathua at Rs 7430 Crore and Samba at Rs 5601 Crore. The average per capita deposits in these three districts turn out to be Rs 3.47 Lakh, Rs 1.20 Lakh and Rs 1.76 Lakh, respectively.
The next two districts in terms of highest bank deposits are Udhampur (Rs 5568 Crore) and Rajouri (Rs 5431 Crore), equating to average per capita deposits of Rs 1 Lakh and Rs 84 thousand, respectively.
On number 6, 7 and 8 are Poonch (Rs 3244 Crore), Reasi (Rs 3022 Crore), and Doda (Rs 2718 Crore). Each of their residents have an average per capita deposit of Rs 68 thousand, Rs 96 thousand and Rs 66 thousand.
Kishtwar and Ramban take the last two steps on the list with the bank deposits of Rs 2092 Crore and Rs 1756 Crore, respectively, equating to average per capita deposits of Rs 90 thousand and Rs 62 thousand, respectively.
With Rs 63296 Crore, the ten districts of Kashmir region contribute 41% in the total deposits.
In Kashmir region, Srinagar contributes to 21.44% of the total deposits, at Rs 32869 Crore, equating to Rs 2.65 Lakh as average per capita deposit, followed by Anantnag at Rs 6327 Crore and Baramulla at 5840 Crore, and an average per capita deposit of Rs 58 thousand and Rs 57 thousand, respectively.
The next two districts in terms of highest bank deposits are Budgam (Rs 4098 Crore) and Pulwama (Rs 3955 Crore), equating to average per capita deposits of Rs 54 thousand and Rs 70 thousand, respectively.
On number 6, 7 and 8 are Kupwara (Rs 2855 Crore), Kulgam (Rs 2521 Crore), and Ganderbal (Rs 1681 Crore). Each of their residents have an average per capita deposit of Rs 32 thousand, Rs 59 thousand and Rs 56 thousand.
On the bottom of the list are Shopian and Bandipora, with the bank deposits of Rs 1667 Crore and Rs 1479 Crore, respectively, equating to average per capita deposits of Rs 62 thousand and Rs 37 thousand, respectively.
In the next installment of this series, we will deep dive into the story of advances of the banks to the people of Jammu and Kashmir, and what they reveal.