The employees were specifically protesting the government's proposal to merge some state-run banks, outsource back-end financial operations to private players.
Updated at 6.20 pm
NEW DELHI: Over a million employees of domestic and foreign banks struck work on Friday to protest the financial sector reforms programme, inconveniencing customers and disrupting commercial activities across the country.
The employees were specifically protesting the government's proposal to merge some state-run banks, outsource back-end financial operations to private players and impose a freeze on new recruitments on non-essential banking areas.
The strike held up the clearing operations of at least five million cheques and caused inconvenience to people who wanted to withdraw money or get drafts made, especially in smaller cities and towns, central bank officials said.
"Except for contract employees, over one million employees, including officers, were on a strike," said C H Venkatachalam, general secretary of the All India Bank Employees Association.
"The losses due to banking strike cannot be quantified, though it inconvenienced customers, corporate and trading sectors. But what to do, we are being forced to resort to strike," Venkatachalam said in Chennai.
The United Forum of Bank Unions (UFBU) - an umbrella organisation of nine trade unions of bank officers and employees - had called the strike after talks with the government and the Reserve Bank of India on Wednesday ended in a stalemate.
In Delhi, some 1,500 employees gathered outside the main branch of the government-owned State Bank of India (SBI) at Parliament Street, shouting slogans against the government's financial sector reforms.
In Mumbai, tens of thousands of bank staff gathered at Azad Maidan shouting slogans against Finance Minister P. Chidambaram's policies.
Only some foreign banks and a few in the private sector were functioning, albeit with a depleted staff. ATM operations at most places, however, were smooth, as per reports received from other cities.
Stock market operations and commodity exchanges also functioned normally.
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