Banking transactions worth about Rs 21,700 crore could not be put into effect across the country as more than 10 lakh bankers struck work on Wednesday to demand wage revision.
"The strike call evoked good response. About 85,000 bank branches, including that of State Bank of India (SBI) and some private banks, spread across the country were closed," C.H. Venkatachalam, General Secretary, All India Bank Employees' Association (AIBEA), told IANS.
The United Forum of Bank Unions (UFBU), an umbrella body of nine bank unions, called for a two-day strike starting Wednesday.
The day saw bankers across the country holding demonstrations to push for an early conclusion of wage negotiations.
Queried about the value and volume of money instruments that would not be cleared by the bank's clearing houses, Venkatachalam said: "On an all-India basis, clearance of 39 lakh instruments with a value of Rs 21,700 crore per day would be impacted. The above value and volume were the averages of last 15 days clearance of instruments."
Venkatachalam said the unions had requested the Indian Banks' Association (IBA) to come up with better offer than the mere two per cent hike offer, so that the strike could be averted.
He said the IBA was also asked not to delink the wage negotiations for bank officers in the Scales 4-7. The IBA did not do anything.
At the conciliation meeting on Monday, the Chief Labour Commissioner (CLC) asked the IBA not to raise new controversies like delinking the wage talks for officers in the 4-7 scale, he said.
"Though the CLC tried its best to sort out the strike issues, there is no positive developments. Hence the strike on May 30 and 31 stands," All India Bank Officers' Confederation (AIBOC) General Secretary D.T. Franco had said earlier.
According to Venkatachalam, with regard to the coverage of officers from Scale 4-7, the IBA said it did not get the mandate from six banks as they opted to cover officers up to Scale 3 level.
However, 14 banks have given the mandate for covering the officers up to Scale 7 in wage negotiations as was done in the previous wage settlement negotiations, he said.
Franco told IANS: "Six banks -- SBI, Punjab National Bank, Bank of Baroda, Union Bank of India, Oriental Bank of Commerce and Indian Bank -- are not in favour of including Scale 4-7 officers under the wage negotiations."
Wage revision in the banks is due from November 1, 2017.
According to Venkatachalam, the Central government had been advising the IBA to conclude the wage issue before November, 2017.
Unions had submitted the Charter of Demands in May, 2017 and discussions commenced with them that month. But even though several rounds of discussions had taken place in the last one year, the IBA did not come forward to make any offer.
On May 5, 2018, the IBA made an offer to hike the wages by two per cent, quoting poor financial condition of the banks as a reason. This offer was not acceptable to the unions.
On Wednesday, leaders of the striking employees said the response of the strike was good across the country including in the eight northeastern states.
"About one lakh bank employees, including officers, stayed away from work across Karnataka," All India Bank Officers' Confederation (AIBOC) General Secretary Y. Sudarshan told IANS in Bengaluru.
Admitting that banking operations have been affected, Sudarshan said the onus was on the IBA and the government.
"In which way are we different from other government employees to be denied what is due for us... we also contribute to the development and growth of the economy," he said.
Rejecting the IBA's contention that banks were unable to bear the burden of huge losses as loans or advances turned into NPAs, he said: "Over 80 per cent of bank loan defaulters are corporates whose funds are cleared by boards and executives."
National Confederation of Bank Employees (NCBE) Tripura unit Secretary Swapan Modak told the media: "Around 4,000 bank employees belonging to about 500 nationalised bank branches in Tripura took part in the strike..."
Government and foreign exchange transactions were also affected due to the shutdown while the ATM machines were being loaded with additional cash.
"We have loaded ATMs with cash of around Rs 15 lakh which would take care of the average cash dispensation for four days," V. Balasubramanian, President, Financial Software and Systems (FSS), told IANS.
Chennai-based FSS manages ATMs for several banks in the country.
Bank of Maharashtra MD and CEO Ravindra P. Marathe urged his customers to make the maximum use of digital banking services as the strike might disrupt normal banking services at the branches.
Meanwhile, industry lobby body ASSOCHAM urged the UFBU to call off the strike as it might affect customer transactions worth up to Rs 20,000 crore.
Public sector banks (PSBs) are grappling with high levels of bad loans and as per reports their losses for the quarter ended March 2018 are set to hit a record Rs 50,000 crore which is more than double the losses of Rs 19,000 crore in preceding quarter ended December 2017.
"Considering such a precarious situation, we at ASSOCHAM would urge the government to come up with a stimulus plan which must include restoring the PSBs to health," ASSOCHAM's Secretary General D.S. Rawat was quoted as saying in a statement.
However, bank unions say the losses are due to provisions for bad loans issued to corporates and "not real losses".
Union leaders say that if corporate members of lobby bodies pay back their loans or service their loans on time, the bank books would not be in the red.