Tuesday, 17 May 2016 16:53

Failure of RBI

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Impacts of Globalisation over the RBI:

The Reserve Bank of India was created predominantly to regulate the Banking System in India. The prime objective is to ensure safety of Public's funds. The Banks will be possessed with large funds in the course of extending  statutory services to the public. Moreover, the RBI is mandated to safe-guard the interests of the Depositors and Investors.

The Banks are in  possession of huge funds of the public which will be in multiple times beyond a Bank's capital investment. It is the duty of RBI to mitigate any incidences of  Bankruptcy of the Bank.

For over the past 2 decades the Governments in India failed to analyse the impact of flow of money into the Banking sector.

Globalisation policies have impacted the Banking system in two ways:

1. Inflow of Borrowers in the Retail segment of the Banks.

2. Innovative Banking modes extended to Customers of the Banks. 

Moot question:

Whether the RBI, an institution created exclusively to safeguard the interest of the depositing customers and to ensure the survival of Banks will be in a position to protect the financial interests (cost of services) of Borrowers and Customers?

The Answer will be a NO. Because both are contradictory domains.

The Reserve Bank of India have been designated with "Conflict of interests" by default of the powers be.

The Reserve Bank of India had cultured itself to work with a easy go conviction,

Failure of a Bank will become a News, but failure of any number of Small Borrowers will be discounted as elimination of public nuisances. The RBI has consistently betrayed the farmers, students and small secured borrowers and let the Banks to sweep them off as the public nuisances.

Public postures :

The Watch Dog of the Banking Sector the RBI and the Cats (Banks) will be .... 

 Internal Relationship:

The Watch Dog of the Banking Sector, the RBI  will be patronised by the Cats(Banks)........

Last Laugh:

On any issues of the Customers/Borrowers with the Banks and the Banking Administrations - the Watch Dog(RBI) and the Cat (Bank) will come together to have the last laugh.

Not only Friends in adversity.....

The Cats (Banks) have reduced the Watch Dog, the RBI to a puppet.

“We cannot be seen as a paper Tiger” - Raghuram Rajan, RBI Governor.

Read 1216 times Last modified on Tuesday, 21 June 2016 19:25

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