T.A. Bhavani and N.R. Bhanumurthy
- Published in print:
- 2012
- Published Online:
- September 2012
- ISBN:
- 9780198076650
- eISBN:
- 9780199081868
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198076650.003.0007
- Subject:
- Economics and Finance, Macro- and Monetary Economics
Chapter 7 makes international comparison of some of the specified aspects of Indian financial system for the most recent years using data from the Financial Development Report 2009 and Financial ...
More
Chapter 7 makes international comparison of some of the specified aspects of Indian financial system for the most recent years using data from the Financial Development Report 2009 and Financial Access 2009. United Kingdom (UK), Brazil and China are selected for the purpose of comparison in view of their level of development in general and financial system in particular. Evidence indicates that the Indian financial system is the smallest—both in depth and breadth—among the four selected countries in majority of the indicators considered in the study. Despite numerous policy measures to enhance financial access India is lagging behind Brazil in terms of access to financial services. This comparison only reemphasizes the need for furthering financial sector reforms in India.Less
Chapter 7 makes international comparison of some of the specified aspects of Indian financial system for the most recent years using data from the Financial Development Report 2009 and Financial Access 2009. United Kingdom (UK), Brazil and China are selected for the purpose of comparison in view of their level of development in general and financial system in particular. Evidence indicates that the Indian financial system is the smallest—both in depth and breadth—among the four selected countries in majority of the indicators considered in the study. Despite numerous policy measures to enhance financial access India is lagging behind Brazil in terms of access to financial services. This comparison only reemphasizes the need for furthering financial sector reforms in India.
T.A. Bhavani and N.R. Bhanumurthy
- Published in print:
- 2012
- Published Online:
- September 2012
- ISBN:
- 9780198076650
- eISBN:
- 9780199081868
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198076650.003.0009
- Subject:
- Economics and Finance, Macro- and Monetary Economics
The last chapter recapitulates the salient features and summary of findings of the study and suggests some policy measures that enhance financial access to real sectors. Empirical analysis of the ...
More
The last chapter recapitulates the salient features and summary of findings of the study and suggests some policy measures that enhance financial access to real sectors. Empirical analysis of the study clearly indicates that the unorganised segment covering agriculture, micro and small enterprises (in industry as well as services sectors), has limited financial access with wider financial resource gap. The often-cited reasons for the limited financial access of the unorganised segment are—high risk and transaction costs. Hence, solution lies in reducing risk and transaction costs. Majority of the existing policies including priority sector lending do not focus on reducing risk and transaction costs. Microfinance institutions (MFIs) are yet to prove themselves in this respect. These are possible only through the encouragement of local area banks, innovative products linking borrowings to savings and insurance products and either removal of priority sector lending or issue of priority sector lending certificates.Less
The last chapter recapitulates the salient features and summary of findings of the study and suggests some policy measures that enhance financial access to real sectors. Empirical analysis of the study clearly indicates that the unorganised segment covering agriculture, micro and small enterprises (in industry as well as services sectors), has limited financial access with wider financial resource gap. The often-cited reasons for the limited financial access of the unorganised segment are—high risk and transaction costs. Hence, solution lies in reducing risk and transaction costs. Majority of the existing policies including priority sector lending do not focus on reducing risk and transaction costs. Microfinance institutions (MFIs) are yet to prove themselves in this respect. These are possible only through the encouragement of local area banks, innovative products linking borrowings to savings and insurance products and either removal of priority sector lending or issue of priority sector lending certificates.
