Wednesday, November 20, 2013

Bhartiya Mahila Bank - A Misguided and Pointless Endeavour

When the Finance Minister announced during his budget speech that the government was planning to start a Bhartiya Mahila Bank, I fervently hoped that it would remain an idea and not actually come to fruition. However, we now have to face the reality of the existence of the Bhartiya Mahila Bank which was inaugurated on the birth anniversary of Indira Gandhi yesterday.

Other banks are nownot-mahila-bank”
Daughter : Dad, the new SBI bank branch that in our village is seeking depositors. They were distributing these account opening forms today. Can I open an account there please!? Pleaaasseee. I also want my own account like bhaiyya.
Dad : No no. What do you need a bank account for? Anyway that bank isn't for you. If you do want you can get an account in the Mahila bank when it comes to our village.

This is a conversation which might be taking place in many orthodox families today. By branding the BMB as a mahila bank, I believe that with one stroke, the government sends the false message that all other banks, pvt or PSUs are not really for women. By creating a special bank that aims to encourage and provide access to banking for women, the government has completely disregarded the fact that all banks are completely capable of providing access to banking for women, have been doing so and should continue.

The Bank's first seven branches are slated to open in Mumbai, Kolkata, Lucknow, Guwahati, Chennai, Bangalore and Ahmedabad which are all urban centres and completely unlikely to have the problem of women lacking access to banks at all!

Consider this, the BMB’s own targets are – 25 branches by 2014 and 770 branches by 2020. Even if it achieves this target or exceeds it, the BMB shall have only a very small fraction of branches as compared to the other PSU banks.

So why this gimmick? Why not use the existing bank and their existing branch network. There is nothing that can justify a special bank.

Segregation is not Empowerment 

At the inauguration ceremony of the bank, the Finance Minister emphasised that the bank wasn’t merely a symbol but that it was true empowerment of women. The claim is downright absurd. The message that the government sends by setting up a new bank ‘for women’ are -

  1. Women are to be treated differently (totally defeats the aim of trying to end discrimination)
  2. When men cannot be trusted to treat women with respect in shared spaces, the women must segregate themselves (this seems like an admission of the government that they cant keep women safe even in a place such as bank which is likely to have many security measures)

Thus, in no way is there any message of the bank empowering women. There is nothing to show that segregation of the sexes leads to women empowerment. By its very definition the concept of segregation is against the concept of equality.

No Bank can be a Mahila Bank 

Very often many of the depositors of a bank and almost always, a majority of the entities obtaining loans from a bank are companies and trusts. These are artificial persons without any gender. A bank’s customers can never be al individual natural persons of one gender. Any bank has to seek to make its own profits and thus in the ordinary course of its business, a bank has to serve various types of customers.

Hence, the concept of a Mahila bank is flawed in itself and even the BNB that has been established is a fullfledged commercial bank that shall serve all customers regardless of their gender and its name is merely a misnomer. It is now an allegedly unique bank with nothing to set it apart except for its exceptionally poor branch and ATM network (atleast for the initial years).

The Mahila Bank is hence a solution that no one was asking for and also one that is likely to worsen the problem which it set out solve. When the question is asked a few years from now “What did the Mahila Bank achieve?”, the government is not going to have any answer.

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