‘We will not allow Banks to be sold’! UFBU strongly rejects Finance Minister’s Statement on Bank Nationalisation

The United Forum of Bank Unions (UFBU), an umbrella body of nine unions representing officers and workmen across banks, has strongly opposed the recent comments made by the Union Finance Minister on bank privatization. The Minister made these remarks during a lecture at the Delhi School of Economics on 4 November 2025.

During the event, a student expressed concern that privatization may limit banking services to only privileged customers. He said that if government banks are privatised, then financial inclusion might be impacted. The Finance Minister rejected this fear and said privatization should be seen positively.

Finance Minister Nirmala Sitharaman said that privatisation of state-owned banks would not hurt financial inclusion and national interest. She said that the bank nationalisation done in 1969 has not yielded the desired result as far as financial inclusion was concerned. Click here to read in detail.

Watch Video What She said 👇

UFBU Says Public Sector Banks Changed India

According to UFBU, bank nationalization in 1969 completely changed India’s financial system. Before nationalization, banking services were mainly for big industrial groups and wealthy business families. Public sector banks opened up credit for farmers, workers, small businesses, women, and weaker sections.

Public Sector Banks expanded banking services from cities to lakhs of villages. UFBU says private banks never tried to reach rural areas because rural banking brings low profits. They also highlighted that priority sector lending, farm loans, student loans, MSME support, SHG financing, and welfare-related banking became possible only because banks were under public control.

UFBU added that PSBs supported the country during economic crises, recessions, and the COVID-19 pandemic without collapsing or exploiting customers.

Privatization Will Harm Banking, Says UFBU

UFBU warned that the push for privatization ignores the risks involved. Private banks focus only on high-profit areas, close loss-making branches, increase charges, and ignore weaker sections of society. If government banks are privatized, rural and semi-urban areas may face financial exclusion.

Most welfare schemes like Jan Dhan Yojana, DBT transfers, pension payments, and MGNREGA wages are handled mainly by PSBs. UFBU said private banks do not have the same commitment to national responsibilities. The unions also warned that privatization could lead to job cuts, contractual jobs, loss of reservation benefits, and attacks on trade union rights.

They pointed out past failures of private banks such as YES Bank, Global Trust Bank, and Lakshmi Vilas Bank. In each case, public sector banks and the government had to rescue depositors. UFBU asked: “In a fully privatized system, who will protect the people?”

Public Funds Should Not Become Private Profit

UFBU said that public money has built national banking assets over decades, and privatization will hand these assets over to private corporate groups. They added that PSBs are accountable to Parliament and the people, while private banks answer only to shareholders.

The NPA crisis, they said, was caused mainly by large corporate defaulters—not by farmers or small borrowers. Blaming public sector banks for NPAs is “incorrect and misleading.” UFBU also noted that after the 2008 global financial crisis, many countries increased public control over banking. India should learn from these experiences.

UFBU Highlights PSB Achievements

The unions said that India’s banking strength today is because of the foundation built by Public Sector Banks. Some of the key achievements are:

• Over 90% of Jan Dhan accounts opened by PSBs
• DBT transfers during COVID-19 handled mainly through PSBs
• Priority and social sector lending driven mostly by PSBs
• Rural banking and financial literacy led by PSBs

UFBU said no country has achieved full financial inclusion through privatized banks.

Privatization Is Not the Only Way

The forum said that professionalism and efficiency in banks can be improved through better governance, modern technology, accountability, capital support, and training. None of these reforms require privatization.

UFBU Puts Forward Key Demands

UFBU has put forward following demands:

1. A clear assurance from the central government that no public sector bank will be privatized.
2. Strengthening of PSBs through capital infusion, technology upgrades, and transparent governance—without privatization.
3. Public consultation and Parliamentary debate before any major decision affecting employees, depositors, or citizens.

UFBU said it stands with citizens, employees, farmers, workers, pensioners, and all stakeholders who believe that banks belong to the people of India. UFBU said: “Public Sector Banks are national assets. We will not allow them to be sold.”