C.H. Venkatachalam, Gen Secretary, AIBEA

19th July is a very significant day in the chronicles of banking sector in our country. It was on this day, on 19th July in the year 1969, 14 major private Banks were nationalised by the Government of India, from when these Banks started chartering a new path with social orientation. AIBEA played a leading role in championing the cause and demand for nationalisation of private Banks. There were continuous struggles for more than 20 years including strikes by bank employees demanding nationalisation of banks.

In those days, all Banks in our country were owned by powerful industrial houses, business houses and capitalist tycoons. They were using the Deposits of these Banks for their own industrial and business needs. They also were reluctant to open branches and extend banking service to the people at large. Loans were not being given to common people. In addition, hundreds of private banks were getting closed due to mismanagement by private managements and owners and the innocent people lost their precious savings.

Given the developing economic scenario, AIBEA demanded that private banks should be nationalised and these banks should play an important role in national development. AIBEA was not daunted and did not feel intimidated. AIBEA was clearly guided by the basic philosophy of the founding fathers that besides fighting for the betterment of the bank employees, AIBEA should also ensure that Banks help the common people at large, especially in a developing economic scenario after two hundred years of subjugation by the British imperialism.

Outside in the streets, bank employees were in the campaign and struggle. Inside the Parliament, Com. Prabhat Kar, the then General Secretary of AIBEA who was a Member of Parliament from 1957 to 1967, consistently took up the issue and mobilised political support.

The issue became a popular demand and in 1969, in the then prevailing political situation, at the cost of a vertical split and division in the Congress Party, Madam Indira Gandhi nationalised the major private Banks.

AIBEA became the champion because AIBEA was the only trade union which raised the issue, demanded, agitated and struggled for this cause.

Nationalisation of Banks has transformed the face of our Banks. It was class banking before and it became mass banking after nationalisation. Thousands of Bank branches were opened in the rural areas. Bank nationalisation brought safety and security for the savings of the people. Sectors which were neglected for lending loans became the priority sectors. Banks started giving loans to agriculture, employment generation, poverty reduction, rural development, health and education, small scale and medium industries, infrastructure, exports, etc. Public Sector Banks started making a big impact on the economic development of our country.

It is equally important to recall that bank nationalisation, which AIBEA achieved, also resulted in huge employment opportunities and lacs of educated young people got jobs in the Banks. Total number of employees were just around one lac in 1969 and today, we have nearly a million bank employees, all due to nationalisation of Banks. Nationalised Public Sector Banks became the engine for driving our country’s economic development. Our Banks proudly became nation-building institutions.

But, sadly enough, in the name of banking sector reforms as dictated and desired by the IMF, World Bank, etc, and as being obediently pursued by the successive Governments, our public sector Banks are facing multiple challenges today. The present Government at the Centre is aggressively following the policies of privatisation and liberalisation of banking regulations.

Private corporates are the defaulters of huge loans but they are being given all concessions. This burden is put on the common people. To offset the loss of revenue on bad loans, interest rate on Deposits is reduced.

Today when our country and our economy are at the crossroads, our public sector Banks have a very significant role to play. They need to be strengthened, they need to be expanded and they should play a much greater role in shaping up a vibrant economy. But unfortunately, instead of strengthening our public sector banks and their social orientation, attempts are afoot to reverse the clock.

It is in this background that we shall celebrate and observe the 51st Anniversary of Bank Nationalisation on the 19th July, 2020.

From AIBEA, we have given the call to bank employees to observe the Bank Nationalisation Day with the following Demands:

• Strengthen Public Sector Banks
• Stop Privatisation of Banks
• Ensure recovery of Bad Loans
• Increase interest rate on Deposits