- Debasish Basu Chaudhury
The State Bank of India has set up a subsidiary in the private sector in the form of “State Bank of India Operations Support Services Private Limited (SBOSS)” apparently for providing support services and Business Correspondent activities to its branches in rural and semi urban areas. The RBI has extended approval for it. It is rolled out at the moment to services mainly for agriculture, micro, small and medium enterprises, other micro loans, data entry operations among others with a stated intention to expand its activities into other areas in future.
Other PSBs would follow
The Subsidiary is mandated to perform all routine transactions through the staff recruited on contractual basis with the support of private financial technology service providers in 8004 rural and 7201 semi urban branches of the bank. The Subsidiary has reportedly started functioning on 16th August 2022 and the bank intends to make it fully functional by the end of this fiscal. All other PSBs are expected to take on the route of transferring core jobs of branch transactions in due course following the route adopted by SBI.
Circumventing legal restrictions
It is clearly understood that the SBI will privatise its entire gamut of frontline banking operations at the branches in course of time through the subsidiary route exactly the way subsidiaries Axis Finance Ltd for Axis Bank, HDB Financial Services Ltd. for HDFC Bank, Kotak Mahindra Services Ltd for Kotak Mahindra Bank and so on did for the new generation private sector banks. The entire exercise is to circumvent the restrictions imposed by legal and regulatory provisions to deploy the contractual employees by the bank itself to undertake the job of transactions. It is meant to drastically reduce manpower costs by getting the job of branch transactions presently undertaken by permanent employees of the bank and getting the same job undertaken by contractual employees at a very low cost to fetch increasing profits and increase in market value of stocks to become an attractive option for acquisition by large domestic and foreign investors.
Consequences will be ruinous for the youth
The consequences will be disastrous for the ordinary banking people. Every banking decisions and transactions are undertaken by bank employees with integrity and reliability more so in the Public Sector Banks where permanent employees, officers including top executives are covered under fidelity and secrecy stipulations and internal vigilance mechanisms including central agencies of CVC and CBI. The safety and security of banking by way of which the ordinary people among themselves have developed unshakable trust with their money in PSBs during the last five decades will give way to cheating and deception of the naive and trusting people. Further the consequences will be ruinous for the aspiring youth of the country who will be deprived of their dreams of decent and secured employment given the reality of prevailing unemployment ravaging the country where qualified engineering and management students largely throng the bank jobs. The consequences no doubt will unsettle and bring uncertainty in the jobs of the bank employees numbering above seven lakhs in the state owned banks of which quite a good number will become redundant by this apparently innocuous looking exercise.
Bank employees have to fight unitedly to defeat this pernicious and unprecedented attack on the employees by this move of backdoor privatisation.