Mumbai: All India Nationalised Banks Officers Federation (AINBOF) has opposed privatisation of public sector banks as it will lead to increase in service charges and will take banking beyond the reach of common man.
In a statement, the AINBOF said privatization will primarily impact the general public only as the social objectives will be lost in the name of profitability.
Service Charges will be increased and customers who are able to bear those charges only will be serviced. This will take banking beyond the reach of the common man which was the primary objective of nationalization, it said.
It said though the Government’s agenda of privatization started way back in 1991 immediately after the liberalization the trade unions were successful in thwarting the ill-conceived moves of the successive governments over the past three decades and maintaining the public sector status.
Of the many private sector banks that came into existence, today only a handful which were promoted by the financial houses like ICICI, UTI, IDBI, HDFC are surviving and many of the private sector entities that commenced their banking operations after 1990 were either closed or merged, it added.
Former RBI Governor Raghuram Rajan also viewed that privatization alone won’t solve the problems of the banking sector, and even private lenders are not immune to the problem of bad assets in a slowing economy.
AINBOF believes that creating public opinion and awareness among the public on the ill effects of privatization will persuade the Government to rethink on its agenda.