RBI , Banks, RTI and Inspection Reports.

 

RBI RTI and Inspection Reports.

The banks suffer from bad borrowers and the entire economy, the people, investors, depositors of banks,general customers and the Government bear the brunt as the banks' contribution to the accrual of the economy and benefits to the society get nullified because of the bad debts. From this angle, there is nothing wrong if banks in their own interest make it public the list of bad borrowers and perhaps the reasons for bad debts , the difficulties in recovering the bad debts including the legal hurdles and other pressures. The losses that banks incur directly and indirectly because of the bad debts can also be brought to public notice if needed. The release of inspection  report can perhaps be made selective in such a manner that the trust  based on which banks function should not  be disturbed. Definitely public should know as to how banks misuse the depositors funds and where they fail to deliver because of lack of professionalism and accountability  and mismanagement of public funds. It is time for RBI to revisit and take a review of the Inspection Reports and make it clear as to what is to be released under RTI Act and what is  not to be released to protect the so called fiduciary responsibilities. The function of Banking is  unique and it cannot be equated with other organisations and corporates.All said the misuse./ abuse of technology, failure in Governance standards to exploit fiduciary responsiblities etc need to be very closely monitored by RBI and public should get the feel that the banks function very safe and all the stake holders benefit with tangible results. The banks' balance sheets also should carry  in brief if possible the STRENGTHS and WEAKNESSES of Banks as indicated by RBI in its Inspection Reports. The Much needed TRUST in banks cannot be allowed to be eroded because of the avoidable transparency as per RTI act but at the same time the release of inspection findings to public in a selective manner should definitely pave way for enhancing the quality of borrowers and performance of banks. 

Dr TVG 

( This comment appeared slightly in a modified manner in the Business Standard Dated 20/7/21.