Reforms panel moots better consumer cover - S.S.Tarapore

.....While the FSLRC gives extensive acknowledgement to many previous reports, by committees/ working groups, it uses selective institutional memory. The FSLRC fails to take cognisance of the Jagdish Capoor RBI Working Group on Deposit Insurance ( 2000), which made many pathbreaking recommendations. This Report advocated differential deposit premia for banks, according to their risk profile, and more importantly, advocated the granting of regulatory and supervisory powers for the Deposit Insurance Agency akin to the US FDIC. The US FDIC has sweeping powers of regulation and supervision over banks in the area of deposits. The reference to Prompt Corrective Action, correctly emphasised by the FSLRC, is not new to India, but in this area, as in other areas, there is considerable pussy- footing when it comes to effective action- this is essentially because the polity does not support strong, timely and effective corrective action. The FSLRC would have gained credibility if it were to acknowledge the lineage of its ideas to the Jagdish Capoor Working Group........

Read - FPJ