Troubled Banks, Beleaguered Customers - Moneylife

Troubled Banks, Beleaguered Customers - Moneylife


Like Indian Railways, Indian banking System is also surviving collapse
and serving the customers not because of, but in spite of, the management. The
credit should go to the majority of their employees who are loyal to the
institutions they serve. No, I am not referring to the people who manage banks,
when say ‘management’ . The reference is to the policies that guide them. The
short-cut of launching new institutions to serve target clientele or ‘directing’
banks to earmark funds for priority sectors or neglected geographical areas
alone will not yield results now. Many HR-related issues from recruitment and
training, remuneration and incentives/disincentives, career progression, board
and top level appointments, neglect of skill-development and opting outsourcing
as a permanent solution for relationship problems between management and
employees (list can be much larger) have contributed to the sagging employee
morale which is affecting per employee productivity. And, this is behind the
high Net Interest Margins banks are forced to retain. While such issues need be
addressed by GOI and RBI, quick and transparent self-regulatory measures by
bank managements alone will save the banks from being brought again under a
regulated regime of interest rates and service charges.
M G Warrier


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