Development banks in a new avatar?

The WLTF banks need to be institutions in search of a new business model to take care of an old need of the Indian economy

The Reserve Bank of India (RBI) has released an important and timely discussion paper on April 4, 2017, on the “wholesale and long-term finance” (WLTF) banks. The genesis of WLTF banks can be traced in the Nachiket Mor Committee report of June 2014 that envisaged a class of differentiated banks called “wholesale banks”. Taking a cue from the Mor Committee report and looking into cross-country experience, the present RBI proposal extends that vision of WLTF banks that would focus primarily on “lending to infrastructure sector and small, medium and corporate businesses” and “will also mobilise liquidity for banks and financial