My View on "Tweaking guidelines won’t do; RBI needs to re-thin...":
A well argued article. When the 'experiments' of RRBs and LABs happened, life was not this fast and 'globalisation' was yet to happen. Need of the hour is a review of the entire institutional structure in banking keeping in view the interests of all stakeholders. Only RBI can do this. Vested interests are diverting central bank's attention to less important aspects of banking. RBI has a history of institution building to meet needs of the time. SBI, UTI, IDBI, SIDBI, NABARD, Exim Bank, RRBs and the failed LABs are some examples to recall. Now, the role and structure of existing institutions need to be redefined and new institutions introduced to meet the needs of changing times. There are no 'business models' to copy. FSLRC which should have had a look at the position strayed away into unexpected pastures.
I am sure this article will explore possibilities of an overhaul of the institutional structure providing financial services in India (including banks) when it appears in ET.
- M G Warrier, Mumbai
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