Banking on banks

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The announcement by the Chief Minister that there will be banking facilities in far-flung areas of the state warrants a serious look. After all, there are many reported cases of government employees not turning up at their postings in far-flung areas for months on end. If substitute banking staff end up filling in for bonafide banking staff who do not turn up in these remote areas, there would be serious repercussions which is not to say that when such ‘local adjustments’ take place in other sectors, the after affects are any lesser. While the idea of ensuring that banking reaches to people in far flung areas is noble, the moot point is whether there are any serious preparation to make banking staff present at their postings and whether there will be strategic steps being taken to educate people on banking options and their usage. Even in Manipur’s capital Imphal, the infrastructure of banks lack in every department: starting from the lack of proper parking areas for bank staff and customers to adequate spaces for sitting or standing in queue. A visit to banks in Imphal area when pension is handed out to retired Government employees is a sight that is disturbing and disquieting with senior citizens standing on roads due to lack of space inside the banks. Banks in Imphal are mostly located in boxed in buildings and squeezed in between other offices and as is common with other buildings in the state, may well be without any fire safety mechanisms in place. The entry of private banks in the state has managed to take away issues of staff unprofessionalism and basic courtesy. Where earlier, National bank staff behaved with indifference towards customers like any other Government employee, the entry of private players has brought in efficiency and better customer services.

There can be no denying that banks today are an integral part of the state due to its sheer volume of transactions and being accessed by people. Which is why, banking systems, mechanisms and adequate infrastructure must be well planed for and put in place. When the situation with banks in the capital town is there for all to see, the idea of setting up banks in Manipur’s remote areas where there is less awareness of banking seems a bit far fetched even though there is a need for banks. Maybe, it would be far better to give more attention to strengthening existing banks in Imphal and other district headquarters and then incorporating elements from the self help group systems of micro credit. There have after all been major success in many developing countries and in India too where, the poor and the illiterate have been facilitated to contributing to their own seed money becoming capital for their use, loan or investment. In such enterprises, community members decide on how the capital is to be used and accessed, how the bank interest rates are to be worked out and paid, in the process making them stakeholders and not mere customers. More than anything else, when community people and villagers are involved in the banking process and in its decisions and not merely objectified as customers, the nature of credit and loan payment becomes in-built. This has been true of most micro credit schemes and in self help groups that has members coming together to pool money as their seed money for joint or individual enterprises. The story of the Grameen Bank in neighboring Bangladesh is there for all to see: starting off in 1976 when Professor Muhammad Yunus as part of a research project came up with the idea of a credit delivery system to give banking services for the rural poor. The efforts that started off with the idea of breaking the traditional base of banks which is “low income, low saving and low investment”, into “low income, injection of credit, investment, more income, more savings, more investment, more income” brought Yunus much acclaim while the Grameen bank became the only business corporation to have won a Nobel Prize. If the intention of setting up banks is for people in remote areas to have banking facilities, then the Grameen bank model can be a sustainable and inclusive model that can be adapted. There is no reason why banks have to function as mere symbols of the upper elites where the less privileged have less access.

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