Integration of information technology platforms of Punjab National Bank, United Bank of India and Oriental Bank of Commerce may take at least six months post the merger of the three state-owned banks, a senior official from Oriental Bank of Commerce said. The merger of the banks is expected to come into effect April 1, 2020.
Integration of technology platform is a crucial factor towards merger of any bank. Punjab National Bank (PNB) currently uses software Finacle 10, while the two other banks use Finacle 7.
In August, finance minister Nirmala Sitharaman had announced the consolidation of 10 state-run lenders into four bigger banks. PNB, Oriental Bank of Commerce (OBC) and United Bank of India (UBI) will be merged to form the second-largest state-run bank in the country, with a business of ₹17.95 trillion (loans plus deposits) and will be at least 1.5 times that of PNB.
The proposed mergers of public sector banks initiated by the government will be a win-win for the account holders as they will be able to avail benefit from the best practices of all three lenders, managing director and chief executive officer of Oriental Bank of Commerce Mukesh Kumar Jain said.
The government’s move to merger state-owned banks aims to cut operational costs and achieve global scale to support fresh investments, revive growth and meet the National Democratic Alliance’s (NDA’s) target to become a $5 trillion economy in the next five years.
Jain said 14-15 services, including cash deposit and withdrawal, passbook updating, balance enquiry, will be offered to customers across all the branch of the three banks, from April 1.
“One can walk into the branch of PNB and avail services of other banks," Jain said.
Besides, 34 teams have been set up to smooth out rough edges to avoid any disruption in banking services.
Jain said banks have urged Sitharaman to approve a fresh name and logo for the new entity, owing to emotional attachment with the name.
As far as the rationalisation of branches of the merged entity is concerned, Jain said it is not an ‘immediate priority’ and will take place post integration of the technology platforms.
“Lot of our branches contribute significantly to our business. So there is no point in closing them," he said.