Crisis Deepens in Uttar Pradesh Gramin Bank as Customers Lose Faith

The Uttar Pradesh Gramin Bank (UPGB), once considered a pillar of rural financial stability, is now struggling with a severe institutional crisis. Once admired for its reliable service and community connection, the bank today stands accused of inefficiency, internal disorder, and leadership failure, leading customers to withdraw their accounts in large numbers.

The UPGB, which emerged from the amalgamation of three strong regional banks Prathama UP Gramin Bank, Aryavart Gramin Bank, and Baroda UP Gramin Bank was once seen as a symbol of consolidation and strength. However, this amalgamation has reportedly led to disorganisation and loss of operational control rather than improvement.

Across various districts of Uttar Pradesh, government employees, teachers, farmers, and the general public are said to be closing their accounts due to poor service and technical disruptions. Frequent IT failures, long downtimes, and lack of responsiveness from staff have made customers wary of keeping their savings in the bank.

Observers and insiders claim that while the bank’s branches are facing operational breakdowns, the top management appears unresponsive. Leadership is alleged to be directionless, with no clear accountability or motivation among employees. The morale of staff members has reportedly dropped sharply due to increasing internal pressure and unclear priorities.

Serious allegations have also been raised against the bank’s chairman, Y.S. Thakur, for focusing more on insurance sales targets and personal events rather than addressing the financial and operational crisis. Accusations of misuse of resources and corruption in the name of insurance campaigns have further damaged the bank’s reputation.

What was once a trusted name in rural India’s financial inclusion efforts is now seen as a struggling institution losing both its credibility and customer base. If immediate reforms and strong leadership action are not taken, experts warn that UPGB’s structure could collapse, severely affecting rural financial access in the state.