Bias slur against banks to be probed | india | Hindustan Times
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Bias slur against banks to be probed

The Centre will probe complaints that state-owned banks were "discriminating" against Muslim students. Last month, the statutory National Commission of Minorities said complaints from Muslims, who say they were being refused accounts by nationalised banks, had more than doubled. Zia Haq & Mahua Venkatesh report.

india Updated: Aug 15, 2010 23:44 IST
Zia Haq & Mahua Venkatesh

The Centre will probe complaints that state-owned banks were "discriminating" against Muslim students. Last month, the statutory National Commission of Minorities said complaints from Muslims, who say they were being refused accounts by nationalised banks, had more than doubled.

Reports say thousands of students in Andhra Pradesh and Bihar have been unable to encash scholarship money from the Minority Affairs Ministry.

Students were being refused "no frills accounts", where they don't have to pay account-opening fees or maintain a balance, the complaints said.

In 2005, the Reserve Bank had provided for "no-frills accounts" for greater "financial inclusion".

In a letter to chief secretaries, the minority affairs ministry observed: "It appears that in many cases these instructions are not being adhered to…."

In 2006, the high-level Sachar report had found that Muslims were behind all groups in terms of access to credit, despite being self-employed at a far higher rate than others.

Minority Affairs Minister Salman Khurshid said: "It looks more of a procedural lapse rather than discrimination. But even without discrimination, such issues can cause distress and will be corrected."

Finance Minister Pranab Mukheree said public sector banks as well as state governments were looking into the issue.

"I am making this arrangement of taking chief bankers to the state headquarters and have interactions with CMs and finance ministers so that individual grievances can be taken care of," he said.

The Finance Ministry has written to bankers to inquire into the complaints and take up the matter with "state-level bankers' committees", a banking advisory panel, and service branches designated as "lead banks" in each district.

An official of a state-run bank said it might not so much be a case of religious bias, but non-compliance with norms.