Now when the people have given a clear mandate to PM Narendra Modi for the second term, the government might think of several major economic reforms and policy changes.
But what may be the changes which might most severely affect the bankers and the common man in general. Lets speculate :
1. Demonetization 2.0
The nightmare of the last Demonetization which took place on 08.11.2016 is still fresh in the lives of every banker and citizen of India, but there have been rumors regarding a possible step in the future. No one knows if the government might take such step in the future, unleashing the wrath upon the banks and the common man in general.
Nothing can be predicted regarding such decision, but one thing is sure, that if such a radical step is taken again, it’s going to be another round of sleepless nights for the banks.
2. Privatisation, Mergers & Acquisitions
We’ve already seen the government’s inclination towards merger of the public sector banks. After the massive merger of Bank of Baroda, Vijaya Bank and Dena Bank, the government is now planning to go ahead with similar mergers among several other PSU banks.
This step has seen mixed reactions, with some groups welcoming the step, while others doubting the decision. But one thing is sure, such Mergers and Acquisitions have brought a havoc to the public sector banks.
3. Performance linked pay-system: End of Secure Payscales
There are several recommendations and views regarding the changes in the pay structure of the public sector banks. The general feeling, however, goes against the Performance linked pay system, with the opinions that it might lead to significant hardships and challenges for the employees of the public sector banks.
What is required is a combined action by the bank unions to negotiate with such measures, in the interest of the bank employees in general.
4. More Government sponsored schemes
It is the nightmare of every banker to see the government launching new government sponsored scheme, and putting the responsibility for the successful implementation of the same union the banks (PSU Banks).
There is no denying the fact that every new government sponsored program brings greater possibility of increase in bank NPA and decline in the asset quality.
But it is too soon to predict what the government might have in its pocket. But there are strong reasons to believe that government will come up with new programs and policies.
5. Finalization of Bipartite Settlement
It has already been more than a year that the Bipartite settlement for Bank employees is due. Unfortunately, the chances of finalization of the Bipartite Settlement in the near future seem weak.
While there have been strong demands and movements for introduction of CPC in the banking sector, the chances of that happening are still very low.
What best can be expected is a gradual shift in the government’s stance towards the banking community, and the finalization of the Bipartite Settlement by the end of FY2019-20. But for this, there is also a need of a strong action from the bank unions and interest groups.
While there are great hopes from the government in terms of economic development and common good, it is not wrong to hope that the government would keep in mind the fate of the millions of bankers and their families.
What might be needed is an effective call from the banking community, loud enough to reach the ears of the policy makers. But for that strikes might not be the right answer. We need to look for the alternative ways to channel our demand.
Until then, let’s be hopeful of a bright future.
Team Banker forum