India needs 3-4 global sized Banks: NITI Ayog

23 Aug
India needs 3-4 global sized Banks: NITI Ayog

Niti Ayog Vide-Chairman, Rajiv Kumar said that India needs three-four large lenders which could figure among top 200 global-sized banks. 


He made a strong case for giving banking sector more freedom to take risks and provide credit to industry especially the MSME sector. 


"We need to have 3-4 banks of global standard in size," he said adding they ought to figure in top 200 global-sized banks. 


Observing that 86 per cent of the loans are given to the big companies, Kumar said there is an urgency to increase credit MSME sector, start up and entrepreneurs. 


"Our banking sector is high conservative. It's risk appetite is minimal and it's capacity of project assessment is not as much it should be. So, it takes recourse to safe banking," Rajiv Kumar said. 


He further added that RBI should refrain from over regulation and encourage banks to take risks and increase exposure to the MSME sector. 


Kumar said that India's credit to GDP ratio is very low compared to many countries.  The central bank should take steps to enhance the lending capacity of the banks, kumar added.