TO STUDY MATERIAL

STATE BANK LEARNING CENTRE TIRUCHIRAPALLI
FOR & AGAINST
1.
Banks have been given autonomy to appoint freely officers from reputed management institutions.
For: This will help the banks in recruiting candidates with the best talent and skills.
Efficiency and quality in the Bank’s services will improve enabling us to meet the emerging challenges in the competitive environment.
Against : This might result in nepotism, favouritism and regional bias and might affect the prospects of the existing employees.
It is not cost effective.
2.
Banks have entered insurance business.
For : The insurance sector offers vast potential for the banking industry to expand its arms. It is an additional source of revenue for the banks.
With their wide network, the banks are at an advantageous position to market their insurance products.
Against: Since it is a new area of highly specialized activity, the banks will be at a disadvantage with regard to trained people and specialists.
They may lose focus on their core activity.
3.
Companies should be allowed to buy back their own shares.
For : This will avoid take over bids.
It can also act as a source for utilizing surplus funds.
Against : This will lead to insider trading.
Price rigging and manipulation will be prevalent.
4.
Associate Banks should be merged with SBI.
For : There will be a huge increase in network, client and asset base of the bank. The combined balance sheet of the merged entity will help the bank to have a significant global presence.
Against : The regional identity of the associate banks will be lost.
Managing vast human resources will be difficult as staff adaptability and redeployment will be a great problem.
5.
Subsidies should be abolished.
For : Tax payer’s burden can be reduced.
Huge resources thus saved can be used for development activities.
Against : The essential commodities for which the subsidies are given will become dearer to the poor and the downtrodden. This will lead to social imbalance and unrest.
6.
SSI eligibility criteria are based on investment in plant and machinery only.
For : It is a ready indicator and any multiple criteria will make it cumbersome.
It is a time tested system which is being followed for the past three decades.
Against : Units with high turnover/profit would also avail this facility meant for SSI.
Export oriented units in SSI need high capital investment.
7.
Special tribunals are to be set up for recovery of dues.
For : Legal procedures are time consuming. Not cost effective.
Against : Existing agencies can be better equipped to handle these cases.
With already existing avenues unable to provide relief, there is no logic in introduction of another one.
8.
Quality Circles should be made compulsory.
For : While working as a team, problems can be sorted out easily and can improve the customer service as a result of synergy of the staff.
Against : The effectiveness will be enhanced only on a voluntary basis and conflicting ideas might result in waste of manpower and time.
9.
Physical presence of the introducer should be made compulsory at the time of opening of an account.
For : Will ensure proper identification of the introducer.
Against : Would create an avoidable restraint on the opening of bank accounts. Would slow down the spread of banking habits among the mass of the people.
10.
Restricted holidays should be introduced in banks.
For : Since Banking has been declared a public utility service, it will help the bank to provide services even on holidays.
Industry, trade and commerce will be largely benefited.
Against : One section of the industry should not be penalized.
Alternatively mutual discussion between trade/industry and banks can be held to avoid loss due to such holidays.
11.
Regional Rural Banks are a burden to sponsor banks.
For : The huge loss incurred and the high level of NPAs in these RRBs are a drain on the sponsoring banks. The establishment expenses are also quite high.
Against : They are a special localized delivery outlet for rural lending. Main focus on the weaker section would be lost.
12.
Corporates should not be allowed to float banks.
For : Might not be the right approach. Combination of business interests and banking interests may lead to instability in such organizations.
Against : Corporates with their professionalism and management skills will be able to provide better quality of service to the public.
Will stimulate competition and many customer friendly products will be introduced.
13.
Agriculture should be given industry status.
For : The reliefs/concessions now granted to other industries can be extended to agriculture.
The workers can get a better wage structure.
Against : Agricultural activity in India is seasonal and mainly dependent on monsoon.
It is more of a family held profession. It may also lose the special attention of the government.
14.
Banks should advance for schemes which have social benefit rather than individual benefit.
For : Since the banks are custodians of public funds, their schemes should benefit a wider cross section of people. The development of society as a whole is more important than that of an individual.
Against : The entrepreneurship development is the only way through which a society can economically prosper.
In the absence of individual development, it is very difficult to enjoy the fruits of social development.
15.
Increasing frauds in Banks are more due to indifference than due to inadequacy of control systems.
For : Majority of the incidence of frauds reported are due to failure in following the laid down systems and procedures, laxity in follow-up and control.
Against : Due to changing environment and introduction of new technologies in a rapid way, the fraudsters are able to forge the documents and hack the system. So a periodical review of the systems and procedures is essential.
16.
SBI should do “Correspondent Banking”.
For : The wide network of SBI can be used extensively by other private and foreign banks.
It is a fee based activity and our profits will increase.
Against : The image/brand equity of SBI will be used by other private and foreign banks to market their business.
In the long run they may become our competitors.
17.
Clearing houses should be delinked from RBI.
For : Except few centres, commercial banks carry out the activity of clearing house.
It will enable the RBI to shed its non-central bank responsibilities.
Against : RBI may lose remuneration and overall control.
There will be a fear of reduction in staff strength of RBI.
18.
Efficient employees should be rewarded and inefficient employees should be punished.
For : This will act as an incentive to improve the efficiency of the employees.
The work culture will improve which will ultimately benefit the organization.
Against : In the absence of suitable mechanism to measure the efficiency, it may lead to favouritism and nepotism.
It will induce unnecessary fear amongst the employees which will affect their performance levels.
19.
Banks should be exempted from Limitation Act.
For : There is no need to obtain revival letters. Banks will be able to concentrate on other areas.
Against : There will be no definite time frame for documents and the staff will become complacent.
20.
Common civil code must be introduced in the country.
For : It will strengthen women’s position in the country by conferring on them equal status and rights. It is provided for in the directive principles of the constitution and Supreme Court judgements.
Against : Basic difference in the personal laws of the different religious communities, tribal customs and traditions have to be overcome.
This is done best by natural evolution and leadership from each of the communities. Any forced change will be counter productive.