Money & Banking

Bank union welcomes FinMin initiative, calls for wider debate

Our Bureau THIRUVANANTHAPURAM | Updated on August 19, 2019 Published on August 19, 2019

The Ministry of Finance.   -  The Hindu

The National Confederation of Bank Employees (NCBE) felt that there is also a need for a wider national debate on the entire banking policy involving all stakeholders

Bank staff unions have welcomed the Ministry of Finance initiative to nudge public sector banks (PSBs) to launch an ideative and consultative process from lower levels to identify various issues and challenges.

The National Confederation of Bank Employees (NCBE) felt that there is also a need for a wider national debate on the entire banking policy involving all stakeholders in order to rebuild the nation.

Credit policy priority

Productive sectors and wealth generation should get focus over speculative activities, said A Raghavan, Joint Secretary, NCBE, and General Secretary, State Banks’ Staff Union (Kerala Circle).

Agriculture and small and medium enterprises should get priority in the credit policy. The Jan Dhan scheme should be expanded to ease credit availability and ensure judicious distribution of the resources.

As per data available, there are around six lakh villages in the country, and yet, the number of rural bank branches are diminishing, Raghavan noted.

A bank branch could be placed right at the centre of developmental effort at the village-level. Naturally, this would translate into higher employment in general, direct or indirect.

Another point that craves for focused attention is the policy on willful default. The Reserve Bank as well as major commercial banks such as State Bank of India have come out with policies in this regard.

Demands have been aired from various sections, especially from bank employees’ unions, for stringent action to address the menace that destroys the very edifice of banking in India.

The cases of willful defaults have increased in the recent years, especially during the last five years. This has been confirmed in the Lok Sabha by Finance Minister Nirmala Sitharaman herself.

Wilful default menace

The number of wilful defaults has increased from 5,349 to 8,582 during the period of 2014-19. The amount involved for the year 2018-19 alone comes to around Rs 1.5 lakh crore.

"At this point, it is also pertinent to point out that during 2014-19, the public sector banks have made an operating profit of Rs 7.17 lakh crore," Raghavan noted.

"But the entire profits plus an additional Rs 40,192 crore from the reserves amounting to Rs 7.5 lakh crore is being apportioned as provision for NPAs. Even wage revision talks due from November 2017 are kept on hold."

Published on August 19, 2019
This article is closed for comments.
Please Email the Editor