Hard to copy | Business Standard Breakingviews

Hard to copy | Business Standard Breakingviews

Fortunately for the
Indian Banking System, till recently the structure and design were under the
control of those who formulated and implemented banking policy. 

Last couple of years have
seen a silent churning in the Indian financial sector and the institutional
structure is undergoing a change, with pulls and pushes from different
stakeholders and certain vested interests. Introduction of new institutions
like Mahila Bank and another apex bank for SHGs(GOI has appointed an Expert
Group to work out details for organising this) and transplantation of ideas
like payment banks and small banks(there is lot of confusion about the prefixes
‘payment’ and ‘small’ among those who are prospective applicants for these
categories of banks) should be viewed in this perspective.

Having said that, the
silver-lining is, RBI is still under control of the situation and has been
silently protecting the interests of depositors and users of banking services,
by timely and appropriate intervention. Kotak-ING tie-up, if it completes
smoothly, will pave way for and encourage more similar efforts for ‘coming
together’ among both private and public sector banks. Increasing public holding
in private sector banks and infusing ‘private sector talent’ into public sector
banks will improve efficiency of Indian Banking System. It is comforting to see
that there is a supportive approach from both GOI and RBI towards this end.

M G Warrier, Mumbai


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