Public, traders, SME biz furious over sudden blanket closure of all bank branches

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The public and private sectors were severely inconvenienced yesterday following the sudden closure of all bank branches countrywide following a directive from the Police. 

The complaint was people, companies, traders and SMEs weren’t able to do urgent transactions which required physical presence in branches. 

All leading banks issued notices over the weekend of the closure of branches for a week from yesterday in view of travel restrictions. However, banks said customers can continue to access services via online, digital and mobile channels. 

Despite the partial lockdown being enforced for nearly a month, some of the biggest private sector banks did operate important branches for the convenience of customers who had to be physically present to carry out transactions. 

However, apparently to discourage unnecessary movement of people, the Inspector General of Police (IGP) has issued a directive on Friday that banks must close all branches but can internally operate with maximum of 15 employees per branch if needed with due notice to the closest Police station. 

This was the background for banks to issue notice of closure formally. 

In the previous two waves of the COVID-19 pandemic, banking services continued uninterruptedly, whilst in the first wave, banks began going direct to the customer doorstep via mobile services, etc. In that context, the public and private sector were questioning the rationale for the blanket closure of branches in the current third wave even though the pandemic has worsened in comparison to the first two waves. 

Within the banking industry, there was some degree of confusion as well as dissatisfaction over the failure of the regulator – the Central Bank not taking a firm decision but directing the banks to be guided by the Police. Law enforcement authorities have also requested the banks to notify contact persons and numbers to customers if they wish to avail a direct response but this was viewed as impractical in a nationwide branch context. 

Whilst bankers said they were not against a full lockdown to curb the COVID-19 third wave if it were required so, but in the context of only travel restrictions being imposed it was important to ensure uninterrupted physical banking services if the need arises to customers on an urgent basis. 

However, despite the closure notice, some banks told the Daily FT that they did handle any urgent requests but growing public complaints and frustration yesterday confirmed that the status quo was far from being convenient and in certain cases, jeopardised important economic and business activities. 

Analysts said that only last week President Gotabaya Rajapaksa directed Governors and District Secretaries that economic, industrial and development activities must not be compromised in spite of the measures enforced to curb the spread of COVID-19. In that context, yesterday saw a loss of confidence in the banking sector.

Daily FT learns, the banking industry was busy yesterday to resolve the situation and find better ways to meet urgent banking needs whilst conforming to COVID health and safety guidelines the way the country saw in the first and second wave.