MUMBAI: Government-owned banks will be closed for an extended weekend with bank unions calling for a two-day strike. Bank employees will strike
work on Thursday and Friday (August 6 and 7) bringing to a standstill most banking activity for the next four days.
Although banks function on Saturdays, there are very few banking transactions, as there is no cheque clearing on weekends. Many suppliers and traders will have to wait until Monday to receive their funds, if they are banking with government-owned banks.
The unions led by United Forum of Banks' Union (UFBU), which comprise at least six lakh workmen and officers as its members will not report to work on Thursday and Friday. The union is protesting against the poor increase in wages suggested by the management led by IBA.
The negotiation between UFBU and IBA which started on Tuesday, failed to reach any common ground till Wednesday evening. IBA has revised its offer on wage hike to 13%, against its earlier offer of 15%. This is the first time IBA has revised its offer downward. Unions on the other hand were demanding 30% increase in wages, but had subsequently brought it down.
Senior bank officials say since all the ATMs would be loaded fully, the savings account customers, at least in metros and semi-urban areas, will not suffer much. There are over 40,000 ATM machines spread across India, however, most of these are concentrated in metros.
Meanwhile, traders are likely to be worst hit since transfer of funds will take longer (more than four days) than usual (one day if the money is over Rs 1 lakh). "Also, since the access of ATMs has become free for customers, bankers feel that savings account customers will not face much trouble," said a senior officer from a PSU bank. In the money market, volumes will come down sharply as PSU banks contribute close to half of the volumes.