MONEY & BANKING


A banker 12 June 2012
The Department of Financial Services has been overactive in issuing directives. Worse, DFS is resorting to brazen ways of dictating to PSBs to sponsor their proposals to the board and get them approved Notwithstanding the fact of substantial private shareholding in PSBs and the...

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A Banker 11 June 2012
The government wants to hold 51% is PSBs and is inflexible about it. It will soon find out the flip side to this, when asked to put in capital to either maintain this stake or force banks to give up growth   The criticality of operational flexibility and functional autonomy for public...

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MDT/PTI 07 June 2012
Cabinet approved the release of 50% share of the central government for recapitalisation of the remaining 24 RRBs to improve their capital to risk weighted assets ratio   New Delhi: The Indian government on Thursday approved Rs632 crore capital infusion in cash-starved regional rural...

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Due to continued weakness in domestic demand and moderate core inflation Nomura expects a 25 basis points cut at the next RBI policy meeting on 18 June 2012   Brokerage and research firm Nomura has said that there will be an additional 50 basis points cut in repo rate in 2012 (25 basis...

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Banks needs to avoid appointing all and sundry as their business correspondents, just to meet internal or policy targets   The government in India has adopted a very important strategy to try and achieve financial inclusion, using business correspondents (BC) to serve and service...

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MDT/PTI 04 June 2012
According to the RBI deputy governor, rising food inflation and depreciating rupee are the conflicting factors the central bank would consider while deciding on policy rates on 18 June Mumbai: With the economic growth slipping to nine-year low levels, Reserve Bank of India (RBI) deputy...

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Moneylife Digital Team 25 May 2012
RBI governor D Subbarao said the matrix of Uttarakhand is probably not very good in terms of number of villages per bank branch   Mussoorie: To expand banking network in hilly areas, Reserve Bank of India (RBI) said it will consider relaxing policy guidelines to encourage banks to open...

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On most of the significant policy issues—implementation of Basle III, NBFC regulation, gold loan companies, securitisation guidelines, etc, all that we have in the policy are datelines for policies to be announced by the RBI. There is more in the offing than we have in the policy, reducing...

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If SHG version 2 is pushed through without a proper and objective understanding of how the SHG Bank linkage program currently functions at the grass-roots (and the path that it has traversed in the past), it could become a recipe for disaster as has happened with much of Indian microfinance...

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Two crucial aspects in microfinance—client origination/targeting and loan appraisal—have been neglected in favour of unprecedented growth (caused by a desire to fully commercialise microfinance and rapidly enhance access/outreach of such services) and this has resulted in the present crisis

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While there are many contradictions, inconsistencies and subjective interpretations in the CoC assessments which seem to draw the attention away from the real issues, we hope the sponsors and developers of the SIDBI-World Bank COCA tool recognize the fact that it far from being a reliable and...

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It is meaningless that the COCA tool rewards mere existence of policy and/or management statements of policy implementation when it should be really looking at solid evidence in support of implementation of the voluntary codes of conduct on the ground An earlier Moneylife article (Have...

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For better credit reporting and the credit bureau to work, ‘the boards of MFIs’ must be able to re-orient their organizational vision to one of responsible finance—this means they will have to move away from their desire for ‘super fast’ unnatural growth to balanced natural growth and normal...

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The establishment and use of a credit bureau in an emerging market like India a very challenging task. If serious efforts are made, it could take several years from initial discussions to regular use of the credit bureau—one that produces reliable and valid credit information reports in a...

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The hype of the moment in microfinance is undoubtedly to subscribe to all kinds of code of conducts, client protection principles, social performance and other self-regulating initiatives. To set the record straight, had all the stakeholders really subscribed to these in the first place,...

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 It is very easy to talk high flying concepts at conferences and also publicly claim that the same is being applied in practice. In reality, however, much of the intended strategies do not get implemented in microfinance and that is something that conference organizers, industry associations,...

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Beyond all the buzz, when can we embed social performance within practice? Social performance is the ‘in’ thing in micro-finance and an entire session is devoted at the Micro-Finance India summit towards the same and a special social performance report is also to be released at the...

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The two-day summit is expected to analyze and introspect on the issues that have led to the erosion of trust with/in the sector. Additionally, the summit is to attempt and build consensus on how the sector can move forward Come November-December and it is microfinance tourism time across...

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The RBI must ensure that informal collateral and/or abusive collateral substitutes do not contaminate microfinance in the future. It should also seriously think on incentives/disincentives that can be set up to eliminate use of informal collateral and/or abusive collateral substitutes, where...

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If the concerned RBI departments could not monitor five of the top 13 NBFC-MFIs that were supposed systemically (very) important, then, how can they be expected to set up supervisory mechanisms for several hundred MFIs as per the proposed Microfinance bill? If equity was in some ways...

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