March 2, 2021

Finance Ministry asks banks to chop prices

No new automobiles, no inside ornament objects, no refurbishment of guesthouses, and diminished entitlements and conditions for furnishings and hire on housing, the finance ministry on Wednesday issued a stern diktat to public sector banks (PSB) to defer ‘avoidable’ expenditure till the following fiscal.

The ministry has directed PSBs to put its order on spending on publicity and conferences by 20% earlier than their boards. The order got here following studies that a big public lender had spent Rs 1.34 crore on three Audis to ferry its high administration.

“Within the context of the COVID-19 pandemic, it’s crucial that banks take applicable measures to make sure productive use of their monetary sources for core enterprise actions,” the order stated.

The ministry requested banks to rationalise bills by weighing their operational profitability and value to earnings ratio in opposition to composition of autos on rent and the occupancy ranges at guesthouses.

The federal government itself has taken a collection of measures to tighten its purse strings by barring new scheme proposals for added fund allocation aside from Covid-19 associated measures, limiting ministry and departments’ use of budgeted funds through the first quarter and freezing hikes in dearness allowance.

Additional, the ministry suggested banks to take up this order of their subsequent board assembly and situation applicable directions internally.