SBI STRIKE: Counting the cost

8226; How will the strike impact SBI consumers?

First, cash withdrawls from bank branches are not possible. The SBI handles about 90 per cent of government salary payments. These employees cannot withdraw their salaries from SBI, unless arrangements are made to do it through other banks. About 9,000 branches of SBI are shut indefinitely due to the strike and customers are at a loss about when they can get their money.

Second, SBI has around 6,000 ATMs which are also running out of cash. A significant amount of withdrawls takes place through them. In 2004-05, Rs 3,133 crore was withdrawn through these ATMs. Arrangements are being made with associate banks to allow customers to withdraw cash from their ATMs.

Cheques paid by SBI customers to other agencies, for example, to pay their electricity, water or credit card dues will not be cleared and payments will therefore be delayed. It is not clear who will bear the brunt of the late fee and interest charges. In all probability, it will be the customer.

8226; How will cheque clearing be hit?

The RBI has taken over cheque clearing in the major centres the SBI was handling. Despite this, it has been reported that 10 to 15 per cent of cheque clearing activity has been hit.

8226; How will the strike affect foreign exchange markets?

SBI has a market share of nearly one fourth of the foreign exchange market. In 2004-05, SBI recorded a total turnover of nearly Rs 3.5 lakh crore in its foreign exchange business. All foreign exchange business normally taking place through SBI will be stalled.