{"id":34211,"date":"2020-11-30T02:42:50","date_gmt":"2020-11-30T02:42:50","guid":{"rendered":"https:\/\/www.gkseries.com\/blog\/?p=34211"},"modified":"2020-11-30T02:42:52","modified_gmt":"2020-11-30T02:42:52","slug":"permitting-industrial-houses-to-own-banks","status":"publish","type":"post","link":"https:\/\/www.gkseries.com\/blog\/permitting-industrial-houses-to-own-banks\/","title":{"rendered":"Permitting industrial houses to own banks"},"content":{"rendered":"\n<p>An Internal Working Group (IWG) of the RBI has recently made a far-reaching recommendation. &nbsp;According to the report, the main benefit is that industry-owned banks would increase the supply of credit, which is low and growing slowly.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.gkseries.com\/blog\/current-affairs-quiz-2019-daily-gk\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Daily Current Affairs Quiz 2020<\/strong><\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Key-Points<\/h2>\n\n\n\n<p>The IWG acknowledges that it ignored the experts the group had consulted. The report states that all the experts except one \u201cwere of the opinion that large corporate\/industrial houses should not be allowed to promote a bank\u201d.<\/p>\n\n\n\n<p>Reacting to it, two former chief economic advisors \u2014 Shankar Acharya and Arvind Subramanian \u2014 as well as a former finance secretary \u2014 Vijay Kelkar \u2014 have called this step a grievous mistake, one that would seriously set back Indian economic and political development.<\/p>\n\n\n\n<p>The problem with banks owned by corporate houses is that they tend to engage in connected lending. This can lead to three main adverse outcomes- over-financing of risky activities; encouraging inefficiency by delaying or prolonging exit; and entrenching dominance.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>An Internal Working Group (IWG) of the RBI has recently made a far-reaching recommendation. &nbsp;According to the report, the main benefit is that industry-owned banks would increase the supply of credit, which is low and growing slowly. Daily Current Affairs Quiz 2020 Key-Points The IWG acknowledges that it ignored the experts the group had consulted. [&hellip;]<\/p>\n","protected":false},"author":404,"featured_media":34212,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1329],"tags":[82],"offerexpiration":[],"class_list":["post-34211","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-affairs-november-2020","tag-economy-current-affairs"],"_links":{"self":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/34211","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/users\/404"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/comments?post=34211"}],"version-history":[{"count":1,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/34211\/revisions"}],"predecessor-version":[{"id":34213,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/34211\/revisions\/34213"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/media\/34212"}],"wp:attachment":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/media?parent=34211"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/categories?post=34211"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/tags?post=34211"},{"taxonomy":"offerexpiration","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/offerexpiration?post=34211"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}