Coronavirus pandemic: Bank of Maharashtra faces ire for 'business opportunity' circular, apologises

Bank of Maharashtra (BoM) has withdrawn a circular urging staff to view the Novel Coronavirus, or COVID-19, pandemic as a ‘business opportunity’ to sell insurance products to customers, Moneylife reported.

The bank issued an apology after it faced backlash on social media. In an email, Satish Kumar, Chief Manager for media relations at BoM, said: “We deeply apologise for the wordings of the said circular, but our intentions were to serve our customers and their family members in the fight against COVID-19 as it is now covered under health insurance policies. The said circular has been withdrawn by the bank.”

Responding to a customer of twitter, the bank stated:

The motive of the Circular was to create awareness amongst customers that by availing insurance at this hour, customers can cover this epidemic also.
Intention of Bank is to encourage Staff to pursue this product as a Social responsibility.

— Bank of Maharashtra (@mahabank) March 19, 2020

The circular in question asked branches to consider the pandemic as a business opportunity to sell additional insurance policies. It was issued on March 17 by TMG Mahabaleshwarkar, General Manager at Resource Planning, Alternative Banking Channels (ABC) and Operations, BoM.

It stated: “Performance of the bank under the ABC campaign is nowhere near expectations in both life insurance and non-life insurance campaigns, which is very disappointing...Looking at the risk of pandemic, 'COVID-19' awareness and demand for health insurance have increased. This is the time to use this as a business opportunity and help our customers by offering suitable health insurance products.”

The initial backlash came from within as the staff reacted with anger. Devidas Tuljapurkar, General Secretary, All India Bank of Maharashtra Employees Federation, which is affiliated with India's largest bank trade union All India Bank Employees Association (AIBEA), termed the circular “inhuman, cruel and hence deplorable at this hour of crisis.”

“Bank staff is attending the branches and office with great risk…asking them to canvass for this product is unimaginative and asking customers to purchase this product is cruel…alluring staff by offering incentives and linking it with their performance is further crueller,” Tuljapurkar said.

The circular had set a target of Rs 3 lakh from March 18-21, to all zones. “Successful zone will be recognised as 'pro-health zone' with a trophy by the insurance company. Performance report shall be appraised to top management separately,” it said.

The incident in particular, since it was a formal bank circular, has highlighted worries about banks looking to cash in on the panic to sell insurance to customers.