Bankers as Development Professionals

Three years ago, I called Narendra Modi, Indira Gandhi with a Y-chromosome. His speech on 31st December supports my contention. Like Indira Gandhi, he is also leaning heavily on commercial banks to achieve his development goals. It is not necessarily a bad thing. Research does show that shows that forcing banks to open more branches in rural areas during Indira Gandhi’s time helped reduce poverty. Modi is leaning even more on Banks than Mrs. Gandhi did. However, I wonder if he realizes how much our Bank professionals resent the developmental work. They are not ready for this role. Their training, their sensibilities and the incentives and the work culture at the banks—nothing prepares them for the developmental role that is being thrust upon them.  Just like our power utilities dislike servicing farmers and the rural poor, banks too would be much happier if villages were left to NGOs and Mahajans.

This transformation in job description—from a commercial role to a developmental one—has some precedence. After India became independent, development administration replaced revenue collection and magistracy as the main job of district collectors. Many an ICS officer did not like this change. Others excelled at it. Our bank managers dislike their changing role even more than the ICS did. I can say so based on many conversations with bank managers who are close friends and family members. When I talk to them, I get a feeling that they have so much power to do good, but few of them are inspired to do so. They treat it as a nuisance, a burden. The little they do is out of coercion, not inspiration and it shows in their collective performance.

A lot has to change if banks have to do all that our government wants them to do. One of these changes is in the training bank officials receive at the beginning of their careers. How you are trained matters. I can say so from my own experience. I was 22 when I joined IRMA. IRMA was only one of the many management colleges I had applied for. Believe it or not the list even included NIFT. Two years at IRMA changed the way I think about what a professional can and should do. I would have been a very different person had I ended up at any other management college.  Irrespective of the career an IRMAN pursues, she or he thinks more keenly about poverty and development, sustainability and inclusiveness than your average educated Indian. IRMANS are more interested in these issues and less cynical about what professionals can do about them even when they are in other fields of work. It’s true that only interest or intent is not enough. Meaningful action is needed. Yet intentions also matter. Self-image is important. Young professionals joining public sector banks need IRMA like training—to take pride in their capacity and the growing opportunity to work not only as astute lenders and deposit mobilizers, but also as a cadre of development professionals.


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