Aadhaar: When bankers are forced to do everything except banking
In the famous movie '3 Idiots', Aamir Khan refers to the beau of Kareena, as 'gadha' (donkey) for working in a bank after obtaining degrees in engineering and management from top ranked institutions. Angry bankers now say that they are being treated the same way by this government. Beleaguered banks and their hapless employees are being forced to take on innumerable tasks that are totally unrelated to banking. Bankers say that they are being made to do a series of tasks that are over and above their regular banking responsibilities. It started with the JanDhan mela, where all bankers were sent scurrying to meet enrolment targets for JanDhan accounts, since the government wanted to claim a massive success. It is another matter that many banks smartly re-activated the dormant no-frills accounts that were opened under a Reserve Bank of India (RBI) whip a few years earlier. This was precisely the time when banks should have been busy keeping a check on Letters of Undertakings (LOUs) and loans that were being furiously issued to the likes of Nirav Modi, Rotomac and Gitanjali Gems.
 
Barely had that ended when banks were again plunged into major chaos following demonetisation. Public sector banks (PSBs), who have the largest rural and semi-urban network bore the brunt of public anger about currency shortages and worked long hours to meet the demands of those who wanted to exchange notes or withdraw their own funds. Through this period over 10 banks were kept headless, which means there was no clear guidance or oversight with regard to core banking activities. The impact is already visible in the high level of fraud that is being detected and the inability to collect on loans given to large industry. A series of PSBs have been placed under Prompt Corrective Action (PCA) and morale of bank officers and employees is at an all-time low. 
 
In the middle of all this, banks have reportedly been given targets for Aadhaar enrolment. This had led to a surge in text messages and emails spamming all account holders and various tricks in the run up to the Supreme Court hearings on dozens of cases filed against mandatory Aadhaar enrolment. Thousands of people linked their bank accounts to their Aadhaar number under threat of their accounts and banking services being frozen. The harassment through texts has stopped only in recent weeks.  
 
Last year, on 14th July, Unique Identification Authority of India (UIDAI), through a gazette notification asked private and public sector banks to open Aadhaar enrolment and updation facilities in one out of 10 branches. This was done under the pretext of following a notification issued by the Ministry of Finance to Prevention of Money Laundering (Maintenance of Records) Rules, 2005. This amendment was made to link every bank account with Aadhaar. Using this Amendment, UIDAI decided that since bank accounts were to be linked with Aadhaar, banks themselves should become enroller and provide this facility. 
 
 
We now understand that bankers were also given targets by UIDAI to for Aadhaar enrolment. Banks had been given a target of logging 16 enrolments daily at 10% of their branches. From 1 July 2018, this has been reduced to eight a day, a report from Press Trust of India (PTI) says quoting a circular issued by the UIDAI (https://uidai.gov.in/images/news/UIDAI-eases-daily-Aadhaar-target-for-bank-branches-FE.pdf ). It also said that banks, which achieve the fresh targets for July will not have to face "financial disincentives" up to that month.   
 
How come UIDAI has set Aadhaar enrolments targets for bankers, who are still finding it difficult to focus on their core job of providing banking services to customers?  
 
"Why there is no circular from RBI directing banks to start Aadhaar registration? Why Indian Banks' Association (IBA) and our unions are silent? Should banks obey orders received from somebody who is not concerned with banking?" asks a banker from a public sector bank (PSB). 
 
Another bank employee, who also does not want to be named, says, "Premises of many nationalised banks are in horrible condition. There is no sufficient space to move within the branch and the staff has to work in utterly disgusting conditions.  How to create additional space for Aadhaar cell?"  
 
Bankers are now increasing raising questions on this 'encroachment' over their primary job, duties and responsibilities towards customers. In fact, few months ago, Corporation Bank Officers' Organisation (CBOO) in its monthly magazine, "Officers' Voice" warned how Aadhaar enrolment is slowly becoming an instrument to terrorise banks in general and bank officers in particular and whether Aadhaar is the mainstream banking function.
 
All India Bank Employees' Association (AIBEA), in a letter to Rajiv Kumar, Secretary in the Department of Financial Services, expressed concern over a directive issued by Ministry of Electronics and Information Technology (MeitY) on 31 May 2018 asking all banks to mandatorily to undertake Aadhaar enrolment from 1 July 2018.
 
"Since such directions affecting the jobs, job profile and role and responsibilities of bank employees are being unilaterally given without any deference to the bilateral agreements, we are unable to accept the same per se. We are constrained to inform you that we are advising our members not to undertake these additional duties, which are beyond their purview," says CH Venkatachalam, General Secretary, AIBEA. 
 
He says AIBEA has been drawing the attention of the banks, IBA and Government that the trend of forcing Banks and bank employees to undertake various types of non-banking activities is on the increase and bank employees are highly stressed on this account. Now this direction to undertake Aadhaar enrolment by Bank branches by bank employees will add to their woes, he added. 
 
Rampant increase in Branches during 2014-2015 has bulged the size of most of the Zones. Commensurate with such increase, controlling offices have not been re-organised nor strengthened. Instead, they are only dumped with further work - SOB transaction authorisations, Finacle training, Aadhaar guidance and e-KYC account opening implementation. This has led to a 'free-for all' attitude in the Branches; a negative courage - 'None comes to know.' 
 
According to the Officers' Organisation, primarily, Aadhaar enrolment is the job of a government department, which has unilaterally been dumped on public sector banks (PSBs). The UIDAI and the Central government are withdrawing private enrolment agencies and want only PSBs and post offices to handle Aadhaar enrolments and updatation work. "If PSBs can do it - why not public sector insurance companies? Why not public sector undertakings (PSUs)? Why not the Indian railway stations or offices? Why not government departments themselves? Surely, the bank employees are not more efficient than these imposing babus! When the government fails to implement it through its departments, which have no accountability, it looks upon PSBs to deliver as PSB officers are accountable to whatever they do and will ensure prompt delivery also," CBOO says. (Read: "#Aadhaar enrolment is now a weapon to terrorise banks and employees," says Officers' Voice from Corporation Bank)
 
One bank employee explains how they were made to move away from their core job of providing banking services to customers. He says, "Earlier, banks used to choose some other activities like utility bill collection to boost other income. Now it is selling insurance policies, mutual funds and above all Aadhaar registration (without any commission?), which is made compulsory."
According to DN Prakash, a union leader, clerical duties in banks are defined under bipartite settlement. "Officers' duties are not defined and it is supervisory in nature and includes anything done in the Bank," he adds.
 
A careful analysis by the Officers' Organisation reveals that over the past two decades, the PSBs have systematically been forced to do the jobs of government departments, which are non-banking activities. It says, "Pension disbursement, income tax, service tax collection and excise collection - all these in the name of non-interest income and cheap float funds - were passed on to PSBs. Bankers grabbed it with both the hands to outshine the rest. Most ridiculous in the process is in respect of deducting tax deducted at source (TDS) on deposits where, instead of making the taxpayer primarily responsible for paying tax and the Income Tax (I-T) officer responsible for ensuring tax collection, bank officers were made responsible for deducting and remitting TDS. The responsibilities of the income tax department were thus intelligently shifted over to bankers! And we bankers accepted it as loyal servants of the nation!"
 
Not only TDS, the banks were also asked to sell gold, mutual funds, insurance products in the name of financial super market and cross selling, which according to CBOO is very lucrative as well as breeding ground for corrupt practices coated with sophisticated terminology. "Several got incentives; many got promotions. But PSBs lost their current and saving accounts (CASA) deposits," the Organisation says, adding, "Due to all these activities, bankers have lost focus on their core banking activities. The end-result is what we are finding today - absence of controls, improper supervision, forceful lending to term finance out of short term deposits to shore up balance sheet totals, asset mismanagement and saddled non-performing assets (NPAs). The present compulsion to enrol Aadhaar will be another nail on PSBs - though not the last."
"No government wants us to look purely after banking and then blame us for rising NPAs of nationalised banks," comments another banker.
 
UIDAI and the Union Government claims to have enrolled about 121 crore people in the number tagging Aadhaar scheme. Interestingly, as per UIDAI's own data (see images below), in Maharashtra, the number are Aadhaar holders show a 'saturation' ratio of 102%, while the same for Telangana is 110%. While UIDAI has not defined 'saturation', it may be related with total population versus number of Aadhaar issued in that state.
 
 
  
In that case, it raises more serious questions. One banker from Mumbai says, "Higher authorities are giving us target to register Aadhaar. In a city like Mumbai, most of the residents have already registered themselves. Where shall we now find un-registered people to complete our target?" 
 
Dr Anupam Saraph, one of the petitioners in the Aadhaar case in the Supreme Court, and an expert in sustainable systems design, also finds the target setting by UIDAI as funny if not devastating. "Who are they enrolling if 121 crore have been enrolled? They do not trust the bank account that were opened during the past over 70 years, but now want the same bankers to generate new data and benami accounts in the process?... (The) drive for enrolment is sufficient to expose that either the 121 crore person's enrolled number is suspect or the data of those 'enrolled' is suspect. All evidence suggests the most likely answer is both of the above," he says.
 
Customer service quality in banks have already deteriorated due to increasing and unnecessary workload on bank employees. If we want all citizens to move into formal financial system, then bankers must be allowed to do their primary job of providing banking service without turning them in to new age social service coolies.
Comments
B. Yerram Raju
3 years ago
It's time that all the officers and employees protest all activities that are not related to banking as they do not form part of legitimate instructions. Only 'disobedience of lawful instructions' attracts penalties and punishments.
Tushar Mangl
3 years ago
Well, if you see balance sheets of Banks and the NPA rates in specific, it seems bankers are hardly interested in their regular banking duties as well.
Ramesh Jaradhara
3 years ago
Govt. has no control on its own employees, as a result of which it depends on the bank employees, who are faithful, loyal and responsible. Nobody asked a donkey how much load it can bear. Until exhausted load onto them. The same happens to the bankers.
Ayan
3 years ago
Being an ex-SBI officer myself(now quit to pursue another career) I do find a lot of truth in the entire story. However, both sides of the coin need to be evaluated.
Bankers are in a lot of pressure due to many reasons, some are :
- Due to ever changing and overburdening of internal circulars which generate more confusion than clarity, it really is difficult to keep track of things and thus the current situation is that no one knows anything for sure and does his/her work on past practices or heresay.
-The constant pressure and targets of cross selling is really what is driving the bank to the gutters. If you do your regular banking work of giving loans or maintaining accounts but maybe are not very enthused of cross selling and do them as it comes by and not in constant pursuit of cross selling, then you are seen as a moocher and a lost cause and you will be embarrassed in branch meetings, peer review meetings etc. It really drives the branch heads crazy as they are literally abused and heckled by the AGMs and DGMs. And now for the bank officer despite all the workload of handling the crowd etc now they have a Damocles sword on their heads and they have to continuously repeat the pros of the cross selling products while simultaneously working. Result is that one has to sit long hours at the desk just to get their work of the day to be done leave aside past/pending work. This is seriously affecting the morale of the new entrants(myself) and the culture in the bank is such that there is a premium on sitting late, you will be judged instantly as a lazy employee if you complete your work early and leave by 6. No Sir, you cannot, you are not supposed to have a life.
- Impossible targets to comply with. Can you imagine having targets for Gold loans. Its generally a last resort option for most but we have targets for that.
- Government work : It has become burdensome for bank employees since Modi took over, but one must understand that opening JDY accounts is in the interest of the bank, though there is a lot of temporary pain involved. Unfortunately, any other Govt dept has no/little accountability when it comes to getting work done. But systems can be designed where people can approach other institutions for PMJJBY, PMSBY, APY...giving all responsibilities to banks has really overburdened the system as nearly all branches work in shortage of staff. Keeping a track of MUDRA loans when payments are not prompt apart from the already existing 100's of loans in a branch, is really difficult and whatever management of time/efficiency the loan officer does, in reality he is at the mercy of the debtor.
- Having Aadhar enrolment at banks is really too much I believe, I wish that the officials who issue such circulars sitting in their AC chambers visit a branch once during peak hours and they will realize how much stress the system is under in.
Top Mgmt Pressure + Govt work pressure....damn its modern day slavery. Why not UIDAI have dedicated/temporary offices to get these things done. As it is there are innumerable errors while enrolling the Aadhar by the private agencies, some intentional but mostly others not intentional. No mobile nos in many Aadhar cards/ mobile number of the agent is provided, I wonder how would it work rather maybe in coming days a new excercise of full cleansing of the system might start.
- Considering the digital push of the Govt, it can be assumed that work load on banks for regular/daily stuff like debiting/crediting money from account, account related changes will lessen over the years and maybe then they will be more focussed on the job at hand. But you never know for sure.
- To top it all, IBA has announced a hike of 2% after 5 years, do hell with you man...these guys have taken the staff for granted and know that they have no other way. Unions are mostly in the Management pockets so little recourse rather than grinding your teeth and wincing in anger.
I hope good days for banks come, but please dont paint all banks/branches with the same brush. Banks are their enemies themselves.
SUBHASH CHATTERJEE
3 years ago
Completely in sync with what has been stated but why the Bank Unions not raising their voice on this together-that is a food for thought. Hope the Bankers are left to do Banking and other governments departments who are supposed to carry out these roles are made to perform.
Ramesh Poapt
3 years ago
prior to these additional works, whether the customers were getting due
services? now in the pretext of the above, customers are not getting due
services...for getting next wages settlement, they will have to swallow these
bitter pills! work not rendered earlier, now to be paid with penal interest!
not 'achhe din' for bankers indeed! more clouds yet in the sky for them!
Ivan
3 years ago
well very researched, very useful insights - well done Yogesh!!
My takeaway - Current red flags for investing inPSU Banks - demoralized employees, managment not in control of operations, hidden skeletons in loan book, increased regulations, capital shortage
SuchindranathAiyerS
3 years ago
Indira Gandhi coined the term "Barefoot Banking". Bankers were raped since 1969. Modi and Sitharaman have commenced work on the Army now. But none will touch the Neta-Babus and Cop-Milards who extort without doing anything for India or Indians.
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