The Financial Sector Reforms and It’s Impact on Financial Inclusion
THE FINANCIAL SECTOR REFORMS AND IT’S IMPACT ON FINANCIAL INCLUSION
SEMINAR PAPER BY: Manju S.V, Assistant Professor S.N.College, Chathannur
UNDER GUIDANCE OF D.R. GABRIEL SIMON THATTIL,
Professor, Department of Commerce University of kerala
INTRODUCTION Banking sector plays a pivotal role in the development of the economy. Banking business is exposed to various risks such as credit risk, liquidity risk, interest risk market risk operational risk and management risk. This risk in order to be reduced requires national and international norms of performance for banks. Liberalization and de-regulation process started in 1991-92 has made a sea change in the banking system. From a totally regulated environment, we have gradually moved into a market driven competitive system. Our move towards global benchmarks has been, by and large, calibrated and regulator driven. Sound regulatory and supervisory framework for banks and NBFC proved crucial in containing the impact of the contagion from global financial crisis on the Indian financial system. The calibrated approach to financial sector reforms and limited exposure of the banking system to synthetic and complex structured products provided the most effective shield against the contagion effects of the financial crisis.
The financial sector reforms ushered in the year 1991 have been well calibrated and timed to ensure a smooth transition of the system from a highly regulated regime to a market economy. The first phase of reforms focused on modification in the policy framework, improvement in financial health through introduction of various prudential norms and creation of a competitive environment. The second phase of reforms started in the latter half of 90s, targeted strengthening the foundation of banking system, streamlining
SEMINAR PAPER BY: Manju S.V, Assistant Professor S.N.College, Chathannur
UNDER GUIDANCE OF D.R. GABRIEL SIMON THATTIL,
Professor, Department of Commerce University of kerala
INTRODUCTION Banking sector plays a pivotal role in the development of the economy. Banking business is exposed to various risks such as credit risk, liquidity risk, interest risk market risk operational risk and management risk. This risk in order to be reduced requires national and international norms of performance for banks. Liberalization and de-regulation process started in 1991-92 has made a sea change in the banking system. From a totally regulated environment, we have gradually moved into a market driven competitive system. Our move towards global benchmarks has been, by and large, calibrated and regulator driven. Sound regulatory and supervisory framework for banks and NBFC proved crucial in containing the impact of the contagion from global financial crisis on the Indian financial system. The calibrated approach to financial sector reforms and limited exposure of the banking system to synthetic and complex structured products provided the most effective shield against the contagion effects of the financial crisis.
The financial sector reforms ushered in the year 1991 have been well calibrated and timed to ensure a smooth transition of the system from a highly regulated regime to a market economy. The first phase of reforms focused on modification in the policy framework, improvement in financial health through introduction of various prudential norms and creation of a competitive environment. The second phase of reforms started in the latter half of 90s, targeted strengthening the foundation of banking system, streamlining
References: 1.RBI Annual Report 2009-2010 pg 103-118 2.Report on Trend and progress of banking in India 2008-2009 3. Southern Economist May 1 2010 January 1 2011 October 1 2010 4.Finance and banking ; Acollection of contemporary research 5. Indian banking vision 2020 6. Report of Committee on Financial inclusion 7. www.iimahd .ernet.in/vikalpa