RBI Central Board discusses banking issues

The Board reviewed the functioning of RBI as well as the current economic situation and global and domestic challenges

The Central Board of Directors of the Reserve Bank of India, which met in Hyderabad on Thursday, has reviewed the functioning of the central bank as well as the current economic situation and global and domestic challenges and policy responses.

“In particular, the Board reviewed areas relating to payment and settlement system, banking supervision, banking regulation, activities of the financial markets department and the Deposit Insurance and Credit Guarantee Corporation,” a release issued by RBI said. RBI Governor Raghuram Rajan chaired the meet.

The board meeting is being held in Hyderabad after a gap of over six years. The last meeting was held on February 8, 2007. RBI Governor Raghuram Rajan chaired the meeting while Directors Anil Kakodkar, Kiran Karnik, Nachikiet Mor, Y H Malegam, G M Rao, Indira Rajaraman and Damodar Acharya attended the meeting. Deputy Governors Harun R Khan, R Gandhi and S S Mundra were also present, according to the RBI release.

Governor Rajan came to the city on Tuesday night on a two-day visit. On Wednesday, he met Telangana chief minister K Chandrasekhara Rao and Andhra Pradesh finance minister Yanamala Ramakrishnudu and discussed issues of mutual interest. He also spoke on the phone with Andhra Pradesh Chief Minister N Chandrababu Naidu who was engaged in relief work in coastal Andhra Pradesh. While in the city Rajan visited the Indian Schoold of Business and interacted with the students.

On Wednesday he made a couple of important announcements while addressing the annual Technology Excellence awards event organised by the RBI-run Institute for Development and Research in Banking Technology (IDRBT). He said the guidelines for setting up small finance banks catering to small customers would be issued in a few weeks.

He also spoke about bringing legislative changes to make the trade receivable finance work for the benefit of small enterprises. He also asked the banks to scale up the mobile banking model quickly for easy, affordable and the faster access to banking services by the people at large.

"We are trying to progress on trade receivable finance where small- and medium-size enterprises that have receivables against large enterprises can actually in an automated fashion have those receivables put up for auction bought by various people with surplus cash.."he said.