Odisha Government Reverses Decision to Remove Banks from State Government List

Strategic Insights -

The Odisha government has decided to continue HDFC Bank, ICICI Bank, and Axis Bank as empanelled banks for handling business and deposits of state government organizations, reversing its earlier decision to remove them from the list. The decision comes after senior officials from the three banks met with the Chief Minister of Odisha and submitted written assurances to improve their performance under government schemes and in general banking parameters.

The State Finance Department had earlier removed the three banks from the empanelled list due to poor performance in government flagship schemes and unsatisfactory banking parameters. However, after the meeting with the Chief Minister, the banks assured the state government that they would improve their performance and requested not to be removed from the list.

Key Takeaways:

  • The Odisha government has reversed its decision to remove HDFC Bank, ICICI Bank, and Axis Bank from the empanelled list of banks.
  • The decision was made after senior officials from the three banks met with the Chief Minister of Odisha and submitted written assurances to improve their performance.
  • The banks were removed from the list due to poor performance in government flagship schemes and unsatisfactory banking parameters.
  • The State Finance Department had issued a notification on April 6, 2023, to remove the three banks from the empanelled list (Notification No. F-20/2023 dated April 6, 2023).
  • HDFC Bank, ICICI Bank, and Axis Bank have been restored to the empanelled list of banks for handling business and deposits of state government organizations.

Statistics:

  • 3 private commercial banks (HDFC, ICICI, and Axis) were initially removed from the empanelled list of banks.
  • The banks were removed due to poor performance in 12 government flagship schemes (Source: State Finance Department notification dated April 6, 2023).
  • The three banks were removed from the list due to poor performance in general banking parameters, including Priority Sector Lending, CD Ratio, etc.
  • 2 days after the meeting with the Chief Minister, the State Finance Department issued a notification reversing the earlier decision (Notification No. F-21/2025 dated July 5, 2025).

Sources:

  • State Finance Department Notification No. F-20/2023 dated April 6, 2023
  • State Finance Department Notification No. F-21/2025 dated July 5, 2025
  • Orissa TV News publication dated July 5, 2025 (with permission from HT Digital Content Services)