The Indian Bank Association (IBA) presented a proposition to the Department of Financial Supervision, Ministry of Finance, in December of the previous year (2023), advocating for the adoption of five-day banking and the designation of all Saturdays as public holidays. This move is prompted by evolving work dynamics, escalating stress levels, and the proliferation of round-the-clock banking services due to increased automation.
Here’s a comprehensive overview of the concept of five-day banking in India.
What exactly is five-day banking?
Five-day banking entails banks operating for business purposes five days a week, typically from Monday through Friday.
Given that the Indian Bank Association (IBA) represents a broad spectrum of banks in India, encompassing public and private sector banks, foreign banks operating in India, cooperative banks, regional rural banks, and all Indian financial institutions, this proposal reflects a longstanding plea from public banks to synchronize India’s banking practices with international norms concerning work-life equilibrium.
When are banks open in India?
Traditionally, Indian banks functioned on a six-day work schedule. However, an amendment introduced in 2015 through the 10th Bipartite Settlement, negotiated with the RBI for all Indian banks, permitted banks to grant two additional holidays on two Saturdays each month.
Currently, all public and private banks in India observe mandatory public holidays on the second and fourth Saturdays of every month, while operating on the first, third, and fifth Saturdays.
Has five-day banking been implemented in India?
Although the proposal has been formally submitted, as confirmed by the Minister of State for Finance, Bhagwat Karad, it is pending approval from the Ministry of Finance. Following this, it will be forwarded to the Reserve Bank of India (RBI) for further deliberation. There has been no indication of its acceptance or imminent consideration.
According to the response to Rajya Sabha UNSTARRED QUESTION NO. 211, answered on December 5, regarding the five-day work plan in nationalized banks:
SMT. SUMITRA BALMIK inquired whether any demands had been made by Bank Union or IBA regarding the implementation of the five-day work plan in nationalized banks, or if there were any plans to implement it, and requested details.
Dr. Bhagwat Karad, Minister of State in the Ministry of Finance, responded affirmatively, stating that the IBA had indeed proposed declaring all Saturdays as banking holidays. He further elucidated that subsequent to the 10th Bipartite settlement/7th Joint note signed between IBA and Workmen Unions/Officer Associations, the Government, exercising its powers under section 25 of the Negotiable Instruments Act, 1881, had declared the second and fourth Saturdays of every month as public holidays for banks in India.
The proposal for a five-day workweek is under deliberation. Should it be sanctioned and implemented, this alteration could entail extended working hours on operational days and would significantly reshape the operational landscape of the banking sector, impacting both employees and customers.
