Union lobby may curtail outsourcing by banks
posted in Outsourcing News and Top Outsourcing deals |Source:Financialexpress.com
The finance ministry may give in to demands by trade unions to exclude some activities from being outsourced by banks. According to government and trade union sources, the Indian Banks’ Association (IBA) and the finance ministry have now asked the unions to submit a report on outsourcing.The ministry and RBI had earlier stressed that core activities would not be outsourced. But trade union sources said the opening and closing of accounts, issuing chequebooks and identifying borrowers were categorised as non-core. Broadly, only accounting activities have been classified as core, they said.
This is a cause for concern and we strongly feel that most of these come under the main activities of any bank and, therefore, should be considered core,” said CH Venkatachalam, secretary, All-India Bank Employees’ Association. A report on outsourcing would soon be submitted to the IBA, he added.
The unions have said that the government should discuss the issue with their representatives. The unions had threatened a nationwide strike in April, but relented after the ministry asked them to submit a report to the IBA.
Official sources said state-owned banks had seen serious erosion in their customer base. Many had opted to bank with private banks, primarily because of reliable services.
