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Amid lockdown, banks, ATM companies warn of rush for salary, government dole

Even as many branches are not able to operate because of a staff shortage, banks are warning of large crowds in branches as Pradhan Mantri Jan Dhan Yojana (PMJDY) account beneficiaries, unfamiliar with debit cards, approach branches for withdrawal.

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Last Updated: Mar 27, 2020, 12.33 PM IST
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(This story originally appeared in on Mar 27, 2020)
MUMBAI: Banks and ATM service providers are bracing for an intense week following the government announcement of direct benefit transfer (DBT) into crores of accounts, which coincides with salary and pension payouts. Even as many branches are not able to operate because of a staff shortage, banks are warning of large crowds in branches as Pradhan Mantri Jan Dhan Yojana (PMJDY) account beneficiaries, unfamiliar with debit cards, approach branches for withdrawal.

Meanwhile, ATM service providers say their employees are not being recognised as ‘essential services’ by police at the ground level. “If the government is going to put in more funds through DBT accounts, the last-mile reach is provided by the ATM network. Government agencies should help ATM service providers and cash-in-transit companies to do their job,” said NCR India MD Navroze Dastur.

He said that the ATM employees should be given curfew passes to be able to attend to the cash machines. “Our employees are doing a diligent job. But if they are beaten on the streets, they will say, ‘Why should we go out?” he added.

ATMs are the backbone of cash disbursement as they can store up to Rs 20 lakh and enable over 200 withdrawals a day. “Law enforcement authorities should be able to identify people providing essential services and provide protection so that they can continue to provide services. These are not normal times and there is a need for everyone to get together to make things work,” said Electronic Payment and Services founder-director Mani Mamallan.

While bank branches have been instructed to operate with a skeletal staff of manager-cashier and sub-staff, even this is proving to be a challenge. Banks are getting staff to take turns in attending office. In some regions, the managers have taken a call to operate branches on alternate days, but there is no instruction from the head office allowing for closure of branches. Most banks have exempted people with disabilities from attending office and are treating this as paid leave.

For SBI, which has been at the forefront of distributing government benefits, another issue is government pension payouts. Pensioners collect their money from the branches and do not use the ATM as they are required to be present at the branch for life certificate verification.

“Next week will be critical because of the salary and pension payment. The state government treasury prohibits banks from issuing ATM cards to pensioners. This needs to be amended forthwith so that pensioners can carry out their transactions through ATM,” said Maharashtra State Bank Employees Federation general secretary Devidas Tuljapurkar. He added that crowding at branches not only puts branch employees at risk but also increases the risk of a contagion. The government has said that it will credit Rs 500 every month for the next three months into PMJDY accounts held by women. Banks were asked to give the number of such beneficiaries on Thursday, following which the transfer date would be announced. They have already been instructed to ensure that there is enough cash with branches, ATMs or business correspondents across the country. Also, funds would be transferred to MNREGA accounts and accounts of senior citizens, widows and disabled who are poor.

(Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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