Two-day bank strike begins today: Millions of customers may be affected across India, ATMs could go dry
Employees from nearly 40 state-owned and private banks across the country are going on a strike on May 30 and May 31 to press for a revision of wages they say is due since November 2017.Updated: May 30, 2018 07:36 IST
Upset by a wage-hike offer that fell short of their expectations, employees of 20 state-owned, 12 private sector, and seven foreign banks will go on strike across India on May 30 and 31, affecting millions of customers, disrupting business, and increasing traffic at automated teller machines around the end of the month -- a time when the salaries of most employees hit their bank accounts.
On May 28, the Indian Banks’ Association (IBA) said it would offer a 2% wage hike this year. The All India Bank Employees Association (AIBEA) said this is inadequate. “Last time the wage hike was 15% and prior to that it was 17.5%. To start a wage hike discussion at 2% increase is ridiculous. IBA should increase it adequately based on which we can talk further,” said CH Venkatachalam, general secretary of AIBEA.
There’s more reason for AIBEA’s angst. IBA also wants to exclude senior employees ( grade 4-7 scale officers) from the discussions. Banks have employees on grades ranging from 1 to 7, one being the lowest. “Currently, it is willing to consider a wage revision only for the junior employees between grade 1 and 3 . Usually, wage revision used to be composite for all. We want IBA to be transparent,” said Venkatachalam, adding that IBA has said it is willing to meet the union after 10 days, holding out hope that the strike could be resolved.
Last week, IBA informed banks that the United Forum of Bank Unions (UFBU) had served notice of a strike. In a regulatory filing, State Bank of India, the country’s largest lender, said, “All India State Bank Officers’ Federation and All India State Bank of India Staff Federation are members of UFBU. Thus, it is likely that our bank will also be impacted to some extent by the said strike calls.”
Account holders in ICICI Bank Ltd, HDFC Bank Ltd and Axis Bank Ltd will not be affected since these banks are not part of the union. However, customers of State Bank of India, Bank of Baroda and Indian Bank will have to postpone plans to visit bank branches for the next 48 hours.
There is a possibility of panic in terms of cash shortage at ATMs. “ATMs will be impacted to a certain extent. Banks will not be able to replenish cash during the period of the strike, causing ATMs to go dry,” said Venkatachalam.
Small towns will be affected more than major cities. “In major towns you have the so-called new generation private banks such as ICICI Bank Ltd and HDFC Bank Ltd as they don’t have a union and they will function,” said Venkatachalam.
“There could be pressure (on us) in states such as West Bengal and Kerala where the union is stronger,” said a private sector bank executive, indicating that even their services could be disrupted.The executive requested anonymity.
Digital transactions through net banking, unified payment interface (UPI), credit cards, debit cards and fund transfers including national electronic funds transfer (NEFT), real time gross settlement (RTGS), and immediate payment service (IMPS) will not be impacted.
“Salary credits, which happens electronically through standing instructions, will not be hit (for employees of ) bigger companies. Smaller companies where there are say only 5-10 employees may be affected,” said an official at a state-owned bank whose employees are striking .