Govt talking to industry and bank managements to address their concerns.
In what could bring cheers to over 1.5 million bank employees ahead of the 2024 general elections, the Centre will likely approve five-day working week for them by December.
Currently, both public sector and private sector banks work on the first and third Saturdays of a month. After approval of the proposed changes, the government will notify all Saturdays as holidays under Section 25 of the Negotiable Instruments Act.
After prolonged negotiations between the apex body Indian Banks’ Association and employee unions, the IBA approved their proposal last month to make all Saturdays a holiday for bank staff. The IBA has sent the proposal to the finance ministry for consideration.
“The government is mostly positive about the proposal,” a person aware of the matter told FE, adding that talks are on with bank management including private banks and industry bodies like Ficci and CII to address their concerns.
While some bank managements have raised concerns about the impact on their businesses and productivity, the trade and industry also fear their business and credit flows might be impacted.
According to the latest data available, there are 1.54 million employees, equally split between public sector banks and private sector banks including payment banks and small finance banks. Separately, there are about 95,000 employees in Regional Rural Banks and another 96,000 in cooperative banks across the country. It is likely that the 5-day week norm will be made applicable to RRBs too.
All these banks may have to take some steps to ensure that the increased number of holidays doesn’t impact the banking operations in the country.
As part of the agreement for a five-day working week, the working hours for banks could be increased by 45 minutes per day to offset any loss of work.
Despite loss of two working days in a month, what could aid the banking industry is the fact that India’s leapfrog in digital banking has shifted most transactions such as cash transfers and payments to mobile and internet banking apps. Cash withdrawals and deposits can now be done via ATMs.
Currently, government offices work five days a week. Life Insurance Corporation of India also works five-day a week for its employees.
