On 5th December (Tuesday), the Union Finance Ministry confirmed in Parliament that the Indian banking sector has formally proposed to declare all Saturdays as official bank holidays. If the union govt accepts the proposal, banks in India will move to a five-day work week, a norm in most private sector companies.
As per reports, the Indian Banks Association (IBA) submitted the proposal, which has been seeking the implementation of a five-day work-week. Responding to queries about the IBA’s demand, Minister of State for Finance, Bhagwat Karad, affirmed that the IBA had submitted a proposal to this effect.
It is important to note that the IBA represents a broad spectrum of banks in India. This includes public and private banks, foreign banks that maintain a presence in India, cooperative banks, regional rural banks (RRBs), and all Indian financial institutions. Over 1.5 million individuals are currently employed in the banking sector in the country.
Currently, banks in India have been observing public holidays on the second and fourth Saturdays of every month, since 2015. Back in 2015, the government implemented the rule under the 10th Bipartite Settlement. It was signed with the RBI, for all banks in India to provide two extra holidays on two Saturdays in the month. This rule is mandatory and applies to both public and private banks across the country. Banks remain open on the first and third Saturdays, and the fifth, if there is one.
There has been a prolonged demand by the Indian banking sector, particularly from public banks, to implement a five-day work-week. The IBA formally approved the demand for a five-day work week in a meeting on 28th July this year. IBA had taken the step after repeated representations and petitions by various bank employee unions with the demand.
However, the response submitted by the Finance Ministry did not specify whether the proposal had been accepted or if it might be considered in the near future, India Today report added. However, Bankers are optimistic that their proposal will be approved by the finance ministry.
If implemented, the proposal could transform how the banking industry operates, affecting both employees and customers. According to sources familiar with the matter, if the IBA’s proposal is accepted then the transition to a five-day work week would be accompanied by extended working hours during the operational days.
This implies that employees would work for five days a week but their daily working hours could be extended by 40 minutes.
Earlier, bank holidays had huge implications for the economy of the country. As all banking transactions were halted on bank holidays, it meant most of the economic activities came to a standstill. However, with the advent of online banking and digital transactions, the country is no longer completely dependent on bank branches remaining open. As online transactions take place 24 hours a day 7 days a week, the impact of a five-day bank work week will not be that much, in case the govt approves the proposal.
