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Islamic banking not relevant in view of fin inclusion prg:MoS

Press Trust of India  |  New Delhi 

Virtually ruling out introduction of Islamic banking, the Ministry today said it has "no relevance" as the has already introduced a host of financial inclusion schemes like

The objectives of the financial inclusion for which Islamic was explored by RBI has no relevance, as has already introduced other means of financial inclusion like and Suraksha Bima Yojna for all citizens, Minister of State for Santosh Kumar Gangwar said in a written reply to the Lok Sabha.

He further said RBI had set up an inter-departmental group on Islamic and the entire exercise was aimed at promoting financial inclusion, accessing huge market potential to attract from countries for infrastructure development.

"However, on consideration of inter-departmental group report, it is observed that even to introduce limited products, various legal changes would be required," he said.

In another reply, Gangwar said, RBI reduced its policy repo rate cumulatively by 175 basis points during January, 2015 to November 24, 2016.

"In response, the weighted average lending rate (WALR) on fresh rupee loans and outstanding rupee loans declined by 108 basis points and 76 basis points respectively (up to October, 2016)," he said.

With the introduction of base rate system by RBI from July 1, 2010 and thereafter Marginal Cost of Fund based Lending Rate (MCLR) system with effect from April 1, 2016, all rupee lending rates have been deregulated and these rates are determined by the banks themselves as approved by their respective Boards, based on their cost of funds and commercial judgement, he added.

In a separate reply, Minister of State for Finance Arjun Ram Meghwal said after withdrawal of the Legal Tender of Specified Banknotes (SBNs) various offices of RBI have provided Rs 238 crore in cash to the post offices.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, December 09 2016. 17:13 IST