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Payment Banks – Digital Banking and Privatisation

Thomas Franco
   Thursday 16 February, 2017  

The advertisements of Airtel Payment Bank showing crowded branches, indifferent staff and different interest rates have been prepared to show public sector banks in poor light and an abuse on the employees of Public Sector Banks. It says why the Banks have to be like this?  The ethics to be followed in advertisement is completely given a go by.

“Chalo School automated” has sent me an email asking to use pay U money for online payment using credit / debit cards, wallet and net banking as easy as movie ticket booking.  It says, “Chalo-lets move to cashless mode to build Digital India”


Another email from paytm says Review & Get Indian Rupee symbol.svg200, Refer & Earn extra Indian Rupee symbol.svg100.


Yet another email received from Funds India says “Save in Super Savings Account and earn 8.65% growth”.  At the bottom of the one page advertisement which lures with “Free ATM Card” says the Super Savings Account invests in Reliance Money Manager Fund” and adds “subject to market risk”.


The fourth email of today from Fullerton India says, “Fulfil your dreams with special offers from Fullerton India Personal Loans – Interest rate starts from 11.99%.  Check Eligibility – Apply online”.


I remember reading “Banking’ means the accepting for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise, and withdrawal by cheque, draft, order or otherwise”.


Are these companies mentioned above who send emails to us and numerous similar companies not doing “Banking”? How this is happening without a Banking Licence?


The government has liberalised everything to encourage the private sector.  Who will supervise?  How the customers will be safe guarded? Every year so many NBFCs are blacklisted. Still the Government does not bother unless huge scams like Saradha Scam surface.


The report of Boston Consultancy Group & Google “Digital Banking 2020” says telecom players like Airtel, Reliance, Vadafone and Tech centric payment players like paytm who are given payment Bank licence cannot earn lending revenues and hence digital banking and cashless Economy have to be pursued.


In a country where 26% are illiterate, 8.43 Cr children do not attend schools in the school going age and only 10% can read and write English, this digital modes are going to further marginalise the marginalised. 10% of the population is 12.7 crores.  These are the once who are Banking with us but now getting lured by the agencies.  This will affect the public sector Banks badly.  Once the profit gets decreasing the banks will be blamed for poor performance and high NPA and they will be privatised.  This has already happened in other countries.  As trade Unions are strong here the Governments are finding alternate ways to privatise.


This can lead to dotcom like scams.  This can lead to looting of common man’s money.  This can also lead to failure of the Banking system. We had only one East India Company which could make us poor slaves and needed 200 years of struggle to send them back. Now hundreds of MNCs, Consultants and Indian Corporates together looting us. 


So time has come for the common man and the Bankers have to come together.  Understand the long term goal of the Government and the private corporates.  Save the common man.  You will save yourself.

* Thomas Franco (ngcfranco@gmail.com)

 

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