SS Mundra: New norms to deal with stressed assets by Oct-end

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“Banks that have taken up cases for resolution under the S4A have represented that the asset classification norms under the S4A may be reviewed to make the scheme more effective,” said a RBI statement.

SS Mundra, deputy governor of RBI said the central bank has set up a special cell under the supervisory department to track large size fraud and co-ordinate with other agencies to take it to its logical conclusion. “ On the consumer side we are working to review banking ombudsman scheme by expanding some of its coverage,” said Mundra.

Apart from this the RBI is also planning to issue guidelines allowing startups to raise external commercial borrowing (ECB) up to $3 million from overseas. The decision to allow startups to raise money through ECBs has been taken in consultation with the government, said the RBI. “Startups have the potential to play a significant role in economic growth and job creation by spurring innovation and injecting competition,” said the RBI.

The RBI also said that it will soon issue operating guidelines for small finance banks and payment banks. In August 2015, the RBI gave in-principle approval to 11 applicants for setting up payments banks. In September 2015, 10 applicants got approval to set up small finance banks out of which two small finance banks have begun operations.

The central bank said that it will issue final guidelines on interest rate options by the end of October. The RBI will also set up a high level inter-agency committee to review the entire “gamut of security of treasure in transit in order to beef up security of remittance of currency notes/coins”.