The civil rights group, Financial Accountability Network (FAN), in a statement on the golden jubilee year of the nationalisation of banks, has demanded that the Government of India should bring back principles of mass banking, adding, “Strong measures should be taken to recover the non-performing assets (NPAs) of corporates”, and willful defaulters should be “declared criminal offenders.”
Also wanting bank charges to be withdrawn, the statement regrets, the nationalised banks, which contributed hugely to the economy over the last five decades, “are under attack for the past 25 years under the neo-liberal rule”, and multiple efforts are on “to privatise banking sector under the dictates of the global capital.”
According to FAN, this has happening even though public sector banks still enjoy the trust of the public at a time when they are facing one of the most severe crises, and the principle of mass banking and catering to the poor and the vulnerable, which is enshrined in the principles of nationalisation, remains their strength.
It adds, “One of the primary causes for the banking crisis is the deviation of the banking sector from ideals of nationalisation. From banking being a service to the common people the banks were forced to lend recklessly to the corporate sector. When the corporate sector accumulated NPAs, the government and the RBI did not ensure proper recovery mechanisms.” “Insolvency and Bankruptcy Code (IBC), which was introduced as a panacea to solve the NPA crisis, only forced the banks to take loss, in some cases as high as 85 per cent, in the name of ‘haircuts’,” the statement insists.