Posing threat to banking and financial sector due to COVID-19

COVID19 outbreak is affecting the world at high speed. It has proliferated across 175 nations, killing thousands of people worldwide. Lakhs of patients have been infected by this deadly virus. At present, there is no cure or vaccination for this disease. The scientists and the medical world are grappling with the pandemic.

This virus affects the respiratory system as it enters a person’s body. It is highly contagious and spreads only through touch and close contact. The infected droplet can stay suspended in the air for up to 2 to 4 hours and enter through your nose or mouth. Also, it can stay over a metal surface for very long hours. Hence, it is necessary to maintain social distancing. If a person gets contaminated by this virus, then he can recover only if he has a strong and robust immune system.

COVID-19 implications in various sectors:

The entire world is right now affected by this fatal virus. COVID-19 has completely devastated the health sector. The world of technology is struggling hard to meet the increasing demand of consumers who are highly dependent on technology after the lockdowns and quarantine. The fashion industry has taken a backseat because no one is interested in splurging their funds on unnecessary fashion wears right now. Also, most of the brick and mortar shops are shut down. COVID 19 has even disrupted the global food supply chain and a lot of people al round the globe is going to sleep hungry right now in the wake of Corona Virus. The ecommerce sector too is struggling because a lot of the portals are shut down, keeping in mind the safety and security of the workers. Also, factories are closed; borders are sealed, and so e-commerce portals are not able to dispatch orders on time. The tourism sector is going through acute loss. Hotels, airlines, cruise ships are incurring losses. About 50 million people across the globe are involved in this sector, are fearing the risk of losing their job. The world is slowly approaching a global recession. The finance sector is hit hard because of this deadly virus.

COVID-19 consequences on the banking sector:

Another sector which is struggling hard in the wake of COVID-19 is banking. The approaching summer is going to be extremely hot and sweaty for the banks because of the challenges, guidelines and regulations of monetary authorities.

The government in India has announced that under Jan Dhan Yojana, 20 crore women account holders will get Rs 500 credited to their account for the next three months. Digital transfer of this amount is also possible. But the truth is that a large chunk of these women might not be using ATM. They might need assistance in withdrawing the amount. Because of countrywide lockdown and social distancing, this can pose a great logistics challenge. For solving the issue, Business Correspondent or BC network can be activated. They can supplement the efforts of the bank and at a safe time, prevent the misuse of reliance on banks.

Earlier experience reveals that during the implementation of several government programmes, middlemen often put unreasonable pressure on the bank staffs. Bank authorities should be getting support from local authorities so that the smooth implementation of the policies can happen.

Also, RBI has announced COVID-19 regulatory package. The aim of this package is to ease the working of capital financing. The implementation of this policy will mess up the working of the bankers.

Although these policies are necessary for the economy as well as the common people, banks personnel definitely face a lot of problems during such emergency situations. They face the brunt of a common man who blames them for stringent policies. While bankers are compelled to follow the orders of the concerned authorities and policymakers.

In this time of dire crisis, we as citizens need to maintain calm and patience. We must avoid disturbing the demand-supply chain so that the economy gets stabilized. This is not the time to spread panic and rumors. Rather, this is the time to unite and support banks, health sectors, government and all other authorities who are working for our betterment only.

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