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Money Financing (Deficit Financing) & Lending Financial Institutions…

- - - - increase fiscal deficit
      - this expansion has to be financed
    - - issuing debt to the public
      - borrowing from RBI
      - increase money supply
    - - related to state of economy
      - rather than medium of financing
    - - output expected to expand
      - without inflation
  - - - rose 2.8% year-on-year
      - due to rise
        
        commercial borrowing
      - Loans
        
        from multilateral and bilateral
        
        grew 4.9% year-on-year
  - - - Create nationalised bank
        
        holding company
        
        replaces
        
        Finance Ministry’s Department of Financial Services
      - must empower RBI
        
        deal with bank challenges
        
        earlier, faster, and invasively
        
        granting
        
        listed bank
        
        capital induction
      - explore new eyes
        
        for banking supervision
      - Regulatory barriers
        
        btw banks, non-banks, and fintech
        
        should not be so sharp as it is today
  - - - lack of adequate
        
        checks and balances
      - absence of any accountability
        
        framework for payment intermediaries
      - created new forms of corruption
        
        evidenced in JH
        
        massive scholarship scam
        
        many poor students
        
        deprived of their scholarships
        
        owing to
        
        a nexus of middlemen
        
        Govt officials
        
        banking correspondents and others
        
        digitally induced
      - Rural banks
        
        short-staffed
        
        tend to get overcrowded
        
        40% of them
        
        make multiple visits
        
        to withdraw from
        
        Customer Service Points (CSP)
        
        leads to loss of wages
        
        increased transportation costs
        
        visit to banks
- - - - unlikely to lend
      - when needed most
      - andd lend to small enterprise borrowers
    - - have 8 times higher chance of bad loan accidents
    - - In rural India
        
        over reliance
        
        on digital tech
        
        widened
        
        distance btw
        
        right holder and entitlements
        
        beneficiaries face
        
        many hurdles
        
        in accessing their money
        
        absence of grievance redressal
      - Over Reliance of Tech & Financial Inclusion
- - - - also include right to access
      - your own money
        
        in timely and transparent manner
    - - must be protected
      - through
        
        strengthening grievance redressal process
        
        setting accountability norms
        
        for all payment intermediaries