The order came from the Department of State finance and it is considered that the recent case of PMC bank and the panic in the public domain has forced the Odisha government to issue this order. According to the experts, the recent ongoing crisis of PMC bank cannot be solely held responsible for this change of perspective. Even the recent economic slowdown and lack of transparency or clarity of data are equally responsible for creating a sense of nervous among the people.
The Odisha state government has asked their departments to avoid parking the funds in any parks and to use them directly when issued from IFMS (Integrated Finance Management System). The issued letter also stated that the departments must withdraw funds only when it is necessary or needed as depositing them in any bank will be considered as a grave mistake.
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The situation is such even when none of the scheduled or commercial banks in the country have collapsed. PMC, a cooperative bank had issued a lot of unethical loans to a real estate company HDIL. Therefore, RBI had to stop the normal functioning of the banks which led to a chaotic situation among its depositors and account holders. The issue is now being dealt with by the RBI and it has provided some relief to the depositors as they can withdraw an amount of Rs. 50,000 till the restrictions are completely withdrawn by RBI.
However, right after the PMC bank crisis, several other public and private banks were also been questioned due to their regularities. The Yes Bank has been particularly under suspicion due to the falling rate of its shares. The letter issued by the Odisha government also mentions that in case a bank collapses or its license is canceled due to any reason, only Rs. 1 lakh including the principal and interest earned will be insured.
This cap was set a long time ago and there have been repeated requests to increase the insured amount to ensure that the depositor’s hard-earned money remains safe. However, strangely there are no serious debates or even public protests reported by the television news channels today.
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The PMC account holders participated in several protests and marches but none of them were fully covered by the electronic media. Also, when the state government itself is no sure about the banks, the doubts and confusion will surely increase among the commoners. None of this seems to be going in the favor of the government but still strangely they are winning elections after elections. Therefore, the common citizens of the country should themselves take care of their hard-earned or deposited money.
Are these truly the good days that were promised to us or it is just a bad phase that will pass away soon? These questions will probably torment the people for at least a few if not more months.
Reference:
https://www.telegraphindia.com/india/no-confidence-letter-on-banks/cid/1713849
