RBI needs a new monitoring culture4 min read . Updated: 08 Aug 2016, 01:22 AM IST
It is time for RBI to keep in step with the change and reformulate its monitoring and tracking indicators
The Reserve Bank of India (RBI) has finally opened the doors to private banks. With two new full-service banks, 23 in-principle approvals for payments banks and small finance banks and now, on-tap universal bank licensing, India has seen more action in the banking space in the past two years than the past two decades. Though on-tap licensing is a big step for the RBI, it was long overdue. While this step would have made waves five years back, much has changed since, and today, it does not feel like a big-bang reform. In fact, there is criticism that there may not be many takers for these licences now. Two main reasons are given—the exclusion of large industrial houses and stringent norms for priority sector lending and financial inclusion, which will be tougher to achieve given the increased competition through the new niche banks.
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