Aviation minister says has asked states to cut jet fuel tax

Tags: News
The Reserve Bank of India today permitted non-banking finance companies to act as business correspondents (BCs) of banks, allowing them to offer limited services with the aim of spreading financial inclusion.

"It has been decided that banks will be permitted to engage non-deposit taking NBFCs (NBFCs-ND) as BCs," the RBI said in a notification.

So far, NBFCs could not be appointed as BCs, which provide limited services on behalf of banks in unbanked areas.

The RBI said there should be a contractual arrangement between a bank and an NBFC-ND to ensure that possible conflicts of interest are taken care of.

Banks must ensure the NBFC-ND does not adopt restrictive practices such as offering savings or remittance functions only to its own customers or bundling of their services, it said.

Banks may continue to take measures to address possible reputational risks arising out of the appointment and functioning of BCs, it added.

To provide operational flexibility to banks and in view of technological developments in the sector, the distance criteria for BCs have been removed, it said.

However, when formulating the board approved policy for engaging BCs, banks should keep in mind the objectives of adequate oversight as well as provision of services to customers while deciding how to modify extant distance criteria, it added.

The RBI said the existing guidelines on the appointment of BCs were reviewed taking into account recommendations of the Nachiket Mor Committee.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Changes to FDI investment norms for housing look cosmetic

    The policy measures announced on Wednesday for facilitating greater participation of foreign direct investment (FDI) in the real estate sector do not

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Varun Dutt

Energy conservation through feedback

In households across the world, people use electric energy not ...

Zehra Naqvi

Rememberance and forgetting are crucial

Memories are so vital to our lives that they can ...

Dharmendra Khandal

Sandalwood may get extinct if not protected

When we talk of sandalwood, the most common usage that ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture