RBI sets up committee to review business correspondent guidelines

The Reserve Bank of India has constituted a committee to review the regulatory framework for business correspondents, with draft guideline amendments to be released soon for public consultation

The Reserve Bank of India has constituted a committee to review the regulatory framework for business correspondents and will release draft guideline amendments for public consultation.

 

Who are part of the RBI committee reviewing BC norms? 

The committee includes officials from the RBI, the Department of Financial Services, the Indian Banks’ Association and the National Bank for Agriculture and Rural Development.

 

What is the mandate of the committee? 

The panel has been tasked with examining the operations of business correspondents and making recommendations to improve their efficiency and effectiveness.

 

What did the RBI say about changes to the guidelines? 

 

“Based on the committee’s recommendations, the related regulatory guidelines are being reviewed, and the draft amendment directions will be placed for public consultation shortly,” the RBI said in its statement on Developmental and Regulatory Policies.

 

Why are business correspondents important to financial inclusion? 

The RBI said business correspondents have been functioning as critical enablers of last-mile access to financial services, particularly in underserved, rural and remote locations.

 

What services do business correspondents provide? 

Business correspondents are deployed by financial institutions and companies to offer basic banking services in unbanked and remote parts of the country.

 

Services such as deposits, withdrawals and bank account opening are delivered through low-cost, technology-driven customer service points spread across India.