3 min read.Updated: 29 Jun 2021, 10:34 PM ISTAmar Ambani
The fault lies in the way the CRA business is structured, as the issuer pays for own rating
Indian credit rating agencies (CRAs) have been facing rough weather in recent years, a combined outcome of a multitude of economic factors. However, the most damaging dent on their reputation has undoubtedly been the IL&FS debacle, which is still fresh in public memory. Despite glaring systemic vulnerabilities, CRAs have gotten away with small penalties on the premise that ratings are, after all, a subjective opinion, and an opinion can’t be penalized.