RBI sets up committee to look at household finances in India

RBI sets up committee to look at household finances in India: The committee will benchmark the current depth of household financial markets in India vis-a-vis those in other major world markets...

RBI committee on household finances

This refers to the report “RBI sets up committee to look at household finances” (Business Standard, August 5). The proposal to set up a committee to look at various facets of household finance in India, according to RBI, came up during the meeting of the Sub Committee of Financial Stability and Development Council (FSDC-SC) held during April, 2016. RBI, particularly its Research and Statistics departments make ongoing internal studies on several aspects relevant to policy formulation and many of the findings get incorporated in the bank’s regular publications like RBI Bulletins and reports as also ‘occasional papers’.
The proposed comprehensive study by experts which will cover various aspects of sources and uses of funds by Indian households will undoubtedly be a valuable document which can change the direction of thinking in favour of much talked about ‘financial inclusion’.
Perhaps, the study could be made a joint effort of GOI and RBI and by expanding the terms of reference given to the panel, the committee could be made an empowered body to go deeper into patterns of savings and investment by individuals and institutions. Mapping of idle financial assets and methods to bring them into the mainstream and sources of funding social security system including pension could come under the broad purview of the areas for coverage by the committee. A look at better management of pension funds and other retirement funds including provident fund is also overdue.

M G Warrier, Mumbai


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