Report on Trend & Progress of Banking in India 2017-18

Report on Trend & progress of Banking in India 2017-18

Question: In context of Report on Trend & Progress of Banking in India 2017-18, Reserve Bank of India pursues to remove burden on banks and has revised guidelines 2017-18. What are the issues faced by banks?
(a) Recapitalisation
(b) Improvement in Banks
(c) Containment of Cyber security risks
(d) All of the above
Answer: (d)
Related facts:

  • Report on Trend & Progress of Banking in India 2017-18 can be considered as a milestone in the evolution of India’s Banking System for the following reasons.
  • The foundations of exhaustive, conclusive and reliable resolution architecture was laid and built upon, with the Reserve Bank equipped with the legislative amendment that empowered it to direct banks on the mechanism to resolve Bad Loan cases, Insolvency and Bankruptcy Code (IBC, 2016) is being established as the pivot in the architecture to resolve stressed assets.
  • The Urban Co-operative Banks (UCBs) were given an opportunity to freely convert to Small Financial Banks (SFBs) allowing them to carry out a wider range of activities and have a pan-India presence as well.
  • The concerted policy initiatives were put in place as force multipliers aiming at inclusive lending, in addition to trading of priority sector lending certificates (PSLCs) on e-Kuber which facilitates indirect lending to the priority sector.
  • The Reserve Bank also encouraged direct lending through co-origination of loans by banks and Non Banking Financial Company (NBFCs).
  • The drive for financial inclusion was rejuvenated by the introduction of the modified Pradhan Mantri Jan Dhan Yojana (PMJDY).
  • The introduction of the recent version of Unified Payments Interface (UPI) has properly placed the banking system to reap the benefits from technology, while being aware of cyber security risks.

Links:
https://www.rbi.org.in/scripts/AnnualPublications.aspx?head=Trend%20and%20Progress%20of%20Banking%20in%20India
https://rbi.org.in/Scripts/FsReports.aspx https://rbidocs.rbi.org.in/rdocs/Publications/PDFs/0RTP2018_FE9E97E7AF7024A4B94321734CD76DD4F.PDF