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04/01/2019 03:05pm

Proposed amalgamation of 3 banks to affect credit flow to MSMEs: Manish Gupta, Rajya Sabha MP

image Proposed amalgamation of 3 banks to affect credit flow to MSMEs: Manish Gupta, Rajya Sabha MP

New Delhi, Jan 4 (KNN) The proposed amalgamation of three public sector banks would result in stoppage of credit flow to Micro, Small and Medium Enterprise (MSME) sector, said Manish Gupta, Rajya Sabha Member from West Bengal while addressing the house.

During the debate on amalgamation of three public sector banks, Gupta said that the announcement made by the finance minister that Bank of Baroda (BoB), Vijaya Bank and Dena Bank will be merged to form the third biggest bank would not solve the problem of NPAs.

He said “The problem is that this particular issue needs more attention because these three banks have NPAs. How will a merger reduce the NPAs? It will only increase the NPAs.”

It is a very serious issue because it involves employment of about 90,000 personnel. There will be closing down of 1800 or 1900 bank branches. This would result in stoppage of credit flow to the MSMEs, SHGs, etc., he added.

Since, these three different banks operates on different IT platform, therefore merging of these platforms is also going to be a problem, Gupta pointed.

Requesting the government not to consider this proposal, he said “Entire matter should be looked at anew and should not be forced at this stage.”

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