Our Response to RBI’s Draft Omnibus Framework for recognising Self-Regulatory Organisations (SROs) for Regulated Entities (REs)
In this blogpost, we present our comments primarily to the former, but significantly implicating the latter. We include both frameworks since they cover similar subject matter – the creation of an SRO.
In this note, we discuss how the current approach of the PCA framework is inconsistent with the objectives it seeks to achieve.
An RBI Working Group has suggested that lending service providers be disallowed from providing credit enhancements such as FLDG (first-loss-default-guarantee). However, a risk-proportionate regulation of FLDG could address its risks, while allowing the ecosystem to benefit from innovation.
In our response, we commend and highlight the more risk sensitive methodology and the corresponding disclosures outlined in the draft guidelines. However, we also point out that not including conduct risk under operational risk is a major lacuna.
The RBI’s Scale Based Regulation (SBR): A Revised Regulatory Framework for NBFCs mandates a Core Banking Solution (CBS) for all NBFCs with more than 10 branches
In this post, based on our earlier comments on the draft guidelines, we analyse whether the highlighted issues have been addressed and also highlight few other potentially impactful changes that are contained in the new framework.
In this blog post, we answer the first two questions. In the next post, we shall present a principle-based approach that the RBI may adopt, thus answering the third question of how the current regulations should be amended or augmented to enhance their efficacy.
Response to RBI’s Consultative Document on Regulation
In this blog post, we present a summary of our response to the consultative document.
Our Response to RBI’s Discussion paper on Revised Regulatory Framework for NBFCs – A Scale-Based Approach, 2021
In this blog post, we share our responses submitted to the RBI to the questions posed in the discussion paper