Nationalized Banks - this is your time

It is a bank for the retired people who have nothing else to do but go wait there all day.

It is a lousy, government organization. It takes hours to get anything done there.

People come, eat lunch, chat, watch TV(!), take breaks & naps and go home. They are least bother about customer service.

While the above applies to any government controlled company in India, I am specifically talking about nationalized banks - like State Bank of India or Canara Bank. You can find the staff highly irritating, very bureaucratic, zero level of customer service, dont-care attitudes and everything that you can complain of. If this were any private company in any sector, the shutters would have been down, the management and staff would have been stoned. But being a nationalized bank, armed with very powerful unions the staff could care less about what management plans or customers think.

How else can you explain the fact that they didnt bother to bring in ATMs and Credit cards into Indian soil for decades until private banks and foriegn banks pushed for it. As much as people blame ICICI for what it has done, but for ICICI, none of the Indian nationalized banks would have even thought about improving customer service. Today a regular savings account in SBI comes with debit card, ATM accesses, Internet Banking and what not !!..

And I think there will be a no better oppurtune moment than now for the nationalized banks to win the faith & love of public. Customers who moved away from these nationalized banks, corporate youth who hate to stand in tellers queues for hours together and NRIs who want to be in control of their money have all now started to pull out their money from private banks like ICICI and are putting them into SBI & Canara & Indian banks. Never before has such a surge of new account openings taken place.

If SBI & others think that this is because of the great customer service that they have or attractive deposits that they offer, they are highly mistaken and awfully arrogant. People move the money into SBI because they think their deposits are insured by the Government of India. And that SBI wont fold and/or run away with their money. If & when the economy stabilizes and there is growth path again, it will be a matter of time the customers find out that making investment decisions with money stuck in a SBI safe is like waiting for a judgement in a Indian court. Customers will take the money and run. And SBI will find itself running to Finance ministry to issue a depositor confidence boosting statement.

So this is the right time for the nationalized banks to improve their service & image. Use all the incoming money to ensure that your operations are made better; hiring is better; services are good; you are more responsive to customer. Ensure that your customer will stay with you because he/she loves your service. Not because they are stuck with you. If SBI & other nationalized banks choose to sleep now and act as if they are kings of Indian banking system, it is a matter of time before mergers happen within them or they get divested and eventually bought out or closed. I know that the socialist circles of India will never let any of this happens, no matter how bad these banks perform, but there is something called as competitive sustainability and without efficiency improvements and innovations, no institution can survive- not even the government itself.

(As a side note, I walked into the newly opened SBI Kondapur @ Hyderabad the other day. It was 11:00 AM. An young chap in his mid twenties sat in one of the teller windows, reading a local newspaper, not bothering to answer the queries customers were asking him. I wonder whether they do a culture fit and actually try and hire the laziest irriating bums to work in these places!)