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RBI chief calls for affordable banking services
Reserve Bank of India Governor Raghuram Rajan on Wednesday underlined the need for offering affordable banking services for people.
Underlines the need for strengthening banking transactions
Hyderabad: Reserve Bank of India Governor Raghuram Rajan on Wednesday underlined the need for offering affordable banking services for people.
Addressing as Chief Guest at the 10th IDRBT Banking Technology Excellence Awards 2013-14 here, the RBI chief also said there was need for interlinking Direct Benefit Transfer schemes and other initiatives such as Jan Dhan Yojana. “This way, banks will be able to measure spending patterns of the end beneficiaries, which will help in fine-tuning the government initiatives,” he explained.
He further underscored the need for enhancing IT security for banking transactions.
“If we introduce biometric security for card transactions, we will be able to minimize frauds in the country,” he said.
On small finance banks which extend services to small customers across the country, Rajan said the apex bank would soon issue guidelines for such banks and thereafter invite applications for setting up the banks. “This is another step towards achieving financial inclusion in the country,” he added. Further, he called upon the existing banks to tap the opportunities provided by mobile technology for achieving financial inclusion targets.
“Banking services will be affordable to millions of Indians if the banks enter into partnerships with telecom operators for offering mobile banking,” he said. “We have tried very hard to get banks cooperate with mobile companies. But the transactions are still very low,” he explained.
Pointing out that small and medium enterprises were also facing some problems in accessing finance, he said some measures should be initiated to address such issues. “We are trying to progress on trade receivable finance where SMEs that have receivables from large enterprises can actually in an automated fashion has those receivables put up for auction bought by various people with surplus cash, by financial institutions or banks at a discount,” he explained.
The mechanism works in such a way that buyers of receivables get an interest for the loans that they are making and small business can get money quickly so they can go out and invest more in the business and grow, he added.
