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Indian Banks’ Association (IBA) feels that bank holidays declared under the Negotiable Instruments Act, 1881, by various States are ‘excessive’ and need to be rationalised.
A meeting of the managing committee of the IBA, which represents management of member banks, is learnt to have made known its view during discussions on ringing in a five-day week in the banking sector.
Consensus ready It may be recalled that as part of the wage revision under the 10th bipartite settlement, a memorandum of understanding was signed on February 23 between the IBA and workmen unions/officer associations. A consensus was arrived at that every second and fourth Saturdays of the month will be holidays and the other Saturdays will be full working days for bank branches/offices.
The matter was discussed in the managing committee of the IBA (represented by public sector banks, private sector banks, foreign banks and cooperative banks) at its meeting on April 7.
After detailed deliberations, the members agreed that there was a case for implementation of a five-day week in banks.
This would require that clearing houses, RTGS/NEFT and currency chests are also closed on second and fourth Saturdays.
The IBA has already taken up the matter with the Reserve Bank of India seeking its consent to enable it to take up the matter with the Government and the Finance Ministry for issuing necessary Gazette notification. It was here that the IBA managing committee felt that holidays declared under the Negotiable Instruments Act, 1881, by various State Governments needed to be rationalised.
The committee felt that the IBA may take up with the Centre the case for rationalisation of bank holidays under the Act.
The IBA’s line of thought was given expression in a letter to the sponsor banks of regional rural banks, seeking their view on having second and fourth Saturdays as holidays and other Saturdays as full working days.
Their input will help usher in uniformity across the industry and ‘enable us at the earliest to proceed further in the matter,’ the letter said.
It went on to add that “we have already taken up the matter regarding rationalisation of bank holidays under the Negotiable Instruments Act with the Finance Ministry.
“We have also requested the Reserve Bank to consider suspension of clearing functions and RTGS/NEFT on second and fourth Saturdays and have full-day clearing services on other Saturdays like any other weekday.”
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