Odisha Govt Reinstates Three Pvt Banks for Handling State Business

In a significant policy reversal, the Odisha government has lifted restrictions on three private sector banks—HDFC Bank, ICICI Bank, and Axis Bank—allowing them once again to conduct state government business.

This comes barely two weeks after the state had delisted the trio from its empanelled list of banks on June 21, citing their underperformance in handling state-run schemes and failure to meet essential banking benchmarks, including priority sector lending and credit-deposit ratio norms.

According to an official order issued on Saturday, the decision to reinstate the banks followed a meeting between senior officials of the three private lenders and Chief Minister Mohan Charan Majhi on July 1. During the meeting, the banks reportedly gave written assurances to enhance their performance and address the deficiencies highlighted by the government.

“After considering the written commitment of the banks to improve their performance, the state government has decided to revoke the earlier order and allow HDFC, ICICI, and Axis Bank to handle state business once again,” the statement read.

The reversal is expected to bring relief to several stakeholders, including customers and departments relying on services from these private banks for faster delivery of financial services and implementation of government schemes.

The move also underscores the state’s willingness to engage constructively with banking partners to ensure optimal service delivery in alignment with its development goals.