Not long ago, banking was considered a 3-6-3 job: Borrow at 3%, borrow at 6% and be at the golf course by 6 p.m. The 3-6-3 rule has been, often mockingly, used to describe the banking industry as one of the most comfortable industries to work in in the face of competition, fintechs and demanding customers trapped with the bankers.
The rule was an apt description of the banking sector in the last century when government regulations were stricter and bank lending practices were more uniform.
Bankers also had the privilege of something called Banker’s Hours, a term that means a shorter working day than most businesses have, which used to be from 9am to 5pm. By comparison, bankers reportedly worked between 10am and 3pm, the hours when banks used to be open.
But those were still busy hours as bankers had to perform their back office tasks as well as deal with customers who came in for all kinds of work from filling passbooks to depositing checks and withdrawing cash, while no one saw the efforts they made when the bank was closed for customers.
But now despite technology shrinking a bank branch into a smartphone where more than 90 percent of a customer’s requirements are fulfilled with a click or a swipe on the screen, life has not yet become easy for bankers. Their role has undergone monumental change, with business generation, bancassurance, margins and competition taking focus away from customer interface. In fact, their working hours have increased with increasing competition and years of attrition, especially at the new-age private banks, increasing their workloads. However, their work week remains the same as they are in their seats for two Saturdays in a month when most other corporate segments have moved to five-day weekly schedules.
IBA proposal for a 5 day work week
So the recent proposal by the Indian Banking Association (IBA) to the Finance Ministry for the adoption of a five-day working week and reports that it may soon become a reality has aptly met with joy in the banking world. However, it also brought its own concerns because banking is an industry that fuels the economy and a two-day shutdown, despite most operations working around the clock, can create new problems.
Also, how will a five-day week affect the most important gear for which the system works: the customer?
There is already a perception among the public, especially the treasure-hungry corporate workers, that if they need to go to the bank, it means taking a day off work. And this is quite true for two reasons. It takes a lot of time in many cases to finish the job if the bank branch is crowded. Sometimes there are long queues etc., specifically in the non-urban areas where the branches are limited. Also, banks operate for a limited period in a day; they are open for customers only until 3pm.
Secondly, banks are closed on the second and fourth Saturdays and all Sundays, which simply means that working professionals have no alternative but to take leaves from their respective offices to complete the banking work if it is urgent and cannot be postponed to the nearest Saturday when . the bank is working. In fact, in the past, I had to take leave many times to tend to bank work.
And if you take a loan, especially a home loan, then your several office sheets are sacrificed to the bank. The procedural work is so huge that you simply cannot do it for even several days. There are many people in the country who would like to visit a branch on the weekend (when they have the time) and finish their work.
On the other hand, the current practice of working two Saturdays is also an injustice to the bank staff who have to work when others enjoy two days off a week. There must be an exchange where the interests of both sides are taken care of.
I think a five day work week should be implemented but it should be flexible. Branches must be open every seven days, and employees can take their leaves on a rotating basis, as is the case in many industries that operate every day.
Therefore, bankers should manage their days rationally and help serve the customers as per their choice. Current banking hours are not suitable for all customers, except pensioners and those who do not go to the office.
Digital Banking is limited
With digital spread many things have been automated and many services are available through mobile. While most bank customers, especially in urban areas, have smartphones and do business online, there is still a large gap in services provided by banks both through the Web and apps. Creating and cashing fixed deposits, transferring funds to people in other countries, especially remittances to students, etc., may still require the mandatory visit to the branch. Many institutions and companies still require a physical canceled check as part of their KYC certification, and therefore the need for a checkbook has not disappeared.
Also, customers still have a lot of questions that automated chatbots can’t answer properly.
Competition in Banking
With the increasing competition, bank employees are under immense pressure. Their work is no longer just about debit and credit. Their effectiveness is measured by how much cross-selling they do. Selling insurance and mutual funds, opening demat accounts, fixed deposits and credit and travel cards are part of their job. Perhaps employees also need enough rest… but the bank’s management and bank boards also need to see how the banker’s job will evolve in the coming years with increasing cross-selling. With heavy competition, attrition is also very high for bankers. So, management must review the working hours, KRAs and KPIs of the bank employees. A five-day week won’t solve all their employees’ problems, it’ll just give them two more Saturdays to themselves. But there are more real issues that lead to high employee attrition that bank managements need to address.
(The Editor’s View is a column written by Amol Dethe, Editor, ET BFSI. Click here to read more of his articles exploring several buzzing topics.)