Govt Announces High Level Committee on Banking Sector

Finance Minister Nirmala Sitharaman on Sunday announced setting up a high-level committee on banking sector to comprehensively review the sector and safeguard financial stability, inclusion and consumer protection in India’s financial sector.

Further details of the committee are expected to be announced in due course.

FM in her Budget speech said, “The Indian banking sector today is characterised by strong balance sheets, historic highs in profitability, improved asset quality and coverage exceeding 98% of villages in the country. At this juncture, we are well placed to futuristically evaluate the measures needed to continue on the path of reform-led growth of this sector.”

“I propose setting up a “High Level Committee on Banking for Viksit Bharat”, to comprehensively review the sector and align it with India’s next phase of growth, while safeguarding financial stability, inclusion and consumer protection.” she added. 

Further, the finance minister also highlighted the government’s vision for NBFCs with targets for credit disbursement and technology adoption. “In order to achieve scale and improve efficiency in the Public Sector NBFCs, as a first step, it is proposed to restructure the Power Finance Corporation and Rural Electrification Corporation,” said the finance minister.

Sitharaman also proposed a comprehensive review of the Foreign Exchange Management (Non-debt Instruments) Rules to “create a more contemporary, user-friendly framework for foreign investments, consistent with India’s evolving economic priorities.”