A stronger push for customer-centric banking is driving fresh reforms across PSB banks. After Finance Minister Nirmala Sitharaman highlighted language barriers at branches, PSB institutions have accelerated local recruitment, tightened transfer policies and introduced training and AI tools to improve communication at the branch level. The focus is on ensuring that PSB staff can speak the local language of customers they serve.
Union Bank of India has recruited 1,500 local area officers and is modifying its transfer policy to retain employees in their home regions. “We have a transfer policy, which we are further modifying, subject to approval, so that local people are mostly retained in their areas,” said MD & CEO Asheesh Pandey. He added, “We are developing chatbots and other AI tools in multiple languages to understand and respond to customers effectively.” Punjab National Bank has hired 750 local bank officers and is providing language training to officers and customer service associates. Indian Overseas Bank has onboarded 400 LBOs, including around 300 for Tamil Nadu, posting recruits in their native states.
Indian Bank has hired 200 local officers and introduced books and audio clips to train staff relocated across regions. Bank of India has launched language proficiency tests and tied up with an institute in Bengaluru for officer-level courses. MD & CEO Rajneesh Karnatak said language issues are less common among clerical staff but formal testing and structured training have begun for officers. Bank of Baroda is offering communication training for staff in non-native areas and piloting a translation app. “The app will automatically convert any customer’s language into the employee’s language and vice versa, enabling instant communication,” said MD & CEO Debadatta Chand.
Sitharaman stressed the need for stronger branch-level engagement in PSB banks. “You have to be a lot more proactive, person-to-person contact, which was the trait of Indian banks. The only flaw I cannot defend on behalf of public sector banks is when, because of HR policy, we post people with different mother tongues to areas where they don’t speak the local language.” She urged PSB leadership to align HR policies with customer realities. “Make sure your HR policies are such that you’re not just recruiting for numbers, but ensuring every staff member posted at a branch understands and speaks the local language,” she said, suggesting performance appraisals linked to local language efficiency.
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