: New Delhi, March 07, 2011
Ending a long period of rising public concern on the continued and increasing issues within the Non Banking Financial Companies (NBFC) sector, The Reserve Bank of India (RBI) created a working committee to solve and deal with all the emerging issues within the sector. The committee would primarily focus on the following aspects:
· Definition and proper classification of Non Banking Financial Companies
· Addressing regulatory gaps and regulatory arbitrage
· Maintaining standards of governance in the sector
· Improvised and appropriate approach to NBFC supervision.
Usha Thorat, former deputy governor of RBI and currently the director of Centre for Advanced Financial Research and Learning (CAFRAL), would be heading this committee.
It would be worth mentioning that the NBFC sector in the country has undergone a paradigm shift of change in last few years and the old regulations in place were insufficient for the changing nature of financial business. Especially the improper classification of some financial companies had caused continuous troubles and confusions apart from various other issues which were continuously coming up since the global economic meltdown two years back.