Nagpur News: The Confederation of All India Traders (CAIT) has welcomed the Nachiket Mor Committee report constituted by RBI governor Raghuram Rajan on comprehensive financial services for small business and low income households.
CAIT also stressed the need for creating an alternate financial mechanism to cater to the financial requirement of small business and low income households.
CAIT national president B C Bhartia and general secretary Praveen Khandelwal, in a joint statement released at New Delhi said that even the RBI panel has also admitted that close to 90 per cent of small businesses have no links with formal financial institutions and about 60 per cent of the rural and urban population do not even have a functional bank account, which amply proves the fact that the nationalised banks and other government financial institutions have utterly failed in meeting the financial requirement of small businesses and lower income people as they do not figure on the priority of all such banks and financial institutions.
Both Bhartia and Khandelwal welcomed the suggestion of RBI panel to set up specialized banks to cater to small businesses and low income households.
They further said that currently above group of people are largely dependent upon private money lenders for their financial requirement which is not a healthy practice.
They said that various non banking finance companies (NBFCs) are also working in the financial sector catering primarily to small businesses and low income group.
Beside implementing suggestion of RBI panel to set up specialised banks, it would be ideal if NBFCs are strengthened further with specified guidelines which may differ from what is applicable to nationalised banks and other government financial institutions.
Both trade leaders appreciated the suggestion of RBI panel about ensuring facility for withdrawal, payment and deposit to be set up within a 15 minute walking distance anywhere in the country.
The nationalised banks alone can not provide such facilities and therefore it is essential to ensure setting up of alternate financial mechanism and thus a situation of financial inclusion can be created in the country, they opined.
The CAIT will study Nachiket Mor Committee report in detail and will take up the matter with RBI governor and the union government for ensuring easy financial assistance to small businesses and low income households.