What is five-day banking: All you need to know

What is five-day banking?

The concept of five-day banking refers to the operational schedule of banks where they remain open for business for five days a week, which is usually from Monday to Friday.

As the Indian Bank Association (IBA) represents diverse categories of banks in India, from public and private sector banks to foreign banks with a presence in India, cooperative banks, regional rural banks, and all Indian financial institutions, the proposal reflects a long-standing demand from public banks to align India’s banking sector with global standards of work-life balance.

When are the banks in India open?

Traditionally, banks in India used to operate on a six-day workweek. However, owing to the reform introduced in 2015 under the 10th Bipartite Settlement, signed with the RBI for all banks in India, allowed Indian banks to provide two extra holidays on two Saturdays in the month.

On a current basis, all the public and private banks in India observe a mandatory public holiday on the second and fourth Saturdays of every month and work on the first, third, and fifth Saturdays of a month.

Has the 5-day banking started in India?

While the proposal has been submitted as confirmed by the Minister of State for Finance, Bhagwat Karad, the proposal is currently awaiting approval from the Ministry of Finance, after which it will be submitted to the Reserve Bank of India (RBI) for further consideration. There has been no announcement of it being accepted or will be considered in the near future.

As per the Rajya Sabha UNSTARRED QUESTION NO. 211, answered on December 5, about a response to the five-day work plan in nationalised banks

211. SMT. SUMITRA BALMIK: Will the Minister of Finance be pleased to state: whether any demand has been made by the Bank Union or IBA regarding the implementation of the five-day work plan in nationalised banks or whether there is any plan to implement it, if so, the details thereof?

Answer by Dr. Bhagwat Karad, Minister of State in the Ministry of Finance: Yes, IBA has submitted a proposal to declare all Saturdays as banking holiday. In regard to the Saturdays being public holiday, subsequent to 10th Bipartite settlement/ 7th Joint note signed between IBA and Workmen Unions/Officer Associations, Government, in the exercise of powers conferred by section 25 of the Negotiable Instruments Act, 1881, vide notification dated 20.8.2015, had declared the second and the fourth Saturdays of every month as public holiday for banks in India.

The proposal for a five-day workweek is still being considered. If approved and put into action, this change could mean longer working hours on operational days and would significantly impact the operational landscape of the banking industry and affect both employees and customers.

Here’s a list of Gazetted bank holidays in the year 2024: