The government of Odisha has made an extraordinary decision to exclude three primary private-sector banks—HDFC Bank, ICICI Bank, and Axis Bank—from its roster of authorized financial entities. This major step results from the perceived underperformance of these banks in carrying out varied government projects over the last two years and their persistent inability to conform to essential banking norms.
Sources privy to the inner workings of the Finance Department reveal that the government of Odisha has been keenly observing these banks’ engagement and effectiveness in the administration of state-subsidized welfare programs and progressive agendas. However, their efforts continually fell short of expectations, even after numerous reminders, and did not result in any noteworthy enhancements to their outreach, competency, or cummulative efficiency in delivering public services.
Not just in relation to the execution of schemes, their evaluation on multiple other banking parameters was also found unsatisfactory. The government, in response to this continual failure, has elected to adopt a more severe approach. A comprehensive directive was issued by the Finance Department to all state departments, authorities, and offices, including public sector entities, educational institutions, societies, and government-supported undertakings.
The mandate compels them to terminate all commercial interactions with these three banks. The directive assertively outlines the following steps: immediate removal of HDFC Bank, ICICI Bank, and Axis Bank from the approved bank list that are qualified to oversee government deposits and conduct business transactions.
It further states that no new deposits or transfers of government finances are to be made into accounts managed by these banks. All pre-existing accounts—be it savings, current, or other categories—held by a government-related entity in these three banks are to be closed instantly.
The Odisha government’s decision is reflective of its determination to uphold accountability and operational efficacy in its financial collaborations, particularly those that involve public funds and service offerings. By excluding these banks from its approved list, they are transmitting a powerful message to other financial institutions about the necessity of embracing the state’s developmental and transparency objectives.
The correspondence from the Finance Department categorically emphasizes that in the future, only those banks that showcase commendable operational performance and proactive engagement in executing welfare schemes will be considered suitable for handling government businesses. This policy modification is predicted to stimulate a healthy spirit of competition and optimized efficiency among the financial institutes functioning within the territory.
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