............Comparing this with the RBI Guidelines on Small Banks released a few days ago, one can see how consistent Raghuram Rajan has been and how he has implemented the idea faithfully now that he is able to, as the RBI Governor. For this he, his RBI Board colleague Nachiket Mor and the senior RBI team all deserve congratulations. The draft guidelines have only a few minor flaws and, if these are attended to, we can hope to see the rise of a new generation of financial service providers, who would help end the currently unacceptable situation in terms of gross spatial, sectoral and segmental inequalities in terms of access to financial services...........
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1 comment:
Vijay Mahajan has proposed most important changes needed in the draft guidelines of the RBI. The area limitation has affected the growth of RRBs and later LABs. Of course, Basix, the parent organisation of Vijay Mahajan has also a LAB and with all its excellent team and resources available, it is unable to expand. Similarly, his suggestion to keep a cap on the loan amount to one unit (individual/firm/co) merits consideration as otherwise the unbanked and the underbanked will continue to be excluded. In fact, the asset portfolio of small banks should have at least 85% of their loans to the financially excluded. Add the non-asset based services such as remittance services for all, pension services for all, insurance services for all etc.
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