India’s first women’s bank has its days numbered
The three year old Bharatiya Mahila Bank (BMB) has its days numbered. This bank was positioned as the only lender for and of women. The Rs 1,000 crore experiment of the previous UPA government has remained a non-starter, sources said. However the issue could turn into a political war between the BJP and the opposition Congress.
While the present Narendra Modi government is keen to merge it with another public sector bank and the hunt for an appropriate match is underway, former UPA finance minister P Chidambaram, who was also part of the launch team, said it was a “terrible” desicion.
“I hope the idea is not being killed because it was launched by the UPA,” Chidambaram told Hindustan Times through a text message, when asked about the present government’s decision.
Soon after the launch of BMB, most other lenders both public and private, introduced branches with only women staff and even came out with special products for women.
“The uniqueness of BMB was lost soon after its launch as most other banks came up with the same model within their own business space..however it wasn’t possible for these banks including BMB to continue with this model..BMB has customers who are men, employees who are men..so how do you differentiate,” said Ashvin Parekh, managing partner, APA Services said.
Top officials of the bank have urged the government to take the final call on the fate of the bank at the earliest as the uncertainty is impacting business and the morale of the employees.
“A final decision on the bank’s fate needs to be taken very quickly, as reports of the merger is impacting our employees and customers as well…who will come to the bank, if there is uncertainty,” SM Swathi, executive director, BMB said.
For the bank board bureau’s (BBB), which came into operation from April 1, the immediate focus would be to look for a match for the lender.
Launched in 2013 by former Prime Minister Manmohan Singh, BMB currently has about 100 branches. “We are looking at options and a decision will be taken soon,” said a senior finance ministry official.
While, the bank, first of its kind in India was launched with great fanfare in Mumbai has not been able to make much of a dent in the market.
The bank’s total advances stood at Rs 446 crore by the end of September 30, 2015, while deposits amounted to Rs 920 crore.
The bank also offers insurance products for women like Nirbhaya — primarily a maternity cover and Sakhee — targeted at the rural women, besides Komal Kali — a recurring deposit scheme for the girl child.
While there have been reports that it may be merged with the State Bank of India (SBI), sources said the merger proposal of BMB would be examined carefully before taking any decision.