Strike fails to affect banking services

Banking operations remained largely unaffected as the one-day strike today by three unions affiliated to Left parties hit working at only couple of banks.

About six lakh bank employees and officers affiliated to three unions owing allegiance to left parties struck work to protest against outsourcing of banking services, including cheque clearing function, as they fear job losses.

The strike did not have an impact in most regions as most big public sector banks including State Bank of India and Bank of Baroda were not affected as the three unions hardly had any influence in these banks.

India has around 11 lakh bank employees and officers in about 88 banks, but the impact of the strike was not felt in most banks as the presence of the three unions in these banks was marginal.

The strike, however, resulted in subdued activity in the bond, money and foreign exchange markets due to the absence of dealers at some banks.

Clearing operations too were not disrupted as SBI controls a majority of the clearing houses and a few are managed by the Reserve Bank of India.

The most affected banks were Canara Bank, Punjab National Bank, and Syndicate Bank, union officials said.

The strike call was given by All India Bank Employees' Association (AIBEA), All India Bank Officers' Association (AIBOA) and Bank Employees' Federation of India (BEFI). The unions were also opposing the proposed removal of ceiling on voting rights in private sector banks.

"We are against the RBI handing over payments system to private participants," said Kamal Bhattacharya, vice-president of the All India Bank Employees Association.

The new payments firm, the National Payments Corp., in which many public sector, foreign and private sector banks hold stakes, was formed earlier this year by the banks and the RBI to create a central retail payments system. The existing system is a mixture of archaic paper-based transactions and electronic systems.

Indian Banks' Association officials said the new firm is not like the outsourcing of back office processes to India by foreign firms.

"It is not outsourcing, it is the consortium of banks which are moving towards the international practices in clearing," said an IBA official.