The Financial Resolution and Deposit Insurance (FRDI) Bill is against the interests of retail investors who depend upon investing their savings into FDs to protect their principal amount. It is a retrograde Bill heavily in favour of big corporate companies who being major loan takers, even in the current low interest rate regime, are major defaulters which has led to NPAs reaching an astounding 10% of the borrowings. Instead of the FRDI Bill, which is anti-people, sanction of large corporate loans should be made more difficult and allowed only on pledging of assets and properties to the extent that only 75% of the pledged assets should be loaned. If banks with an elaborate management structure cannot manage the affairs in these low interest rate regimes, then it is the failure of the government and RBI,thus the ‘bail out' and not the ‘bail in' should be resorted to as banking is also a business on which the PSBs and the scheduled banks have government guarantees. The Opposition in the RS needs to block passage of this draconian Bill in Parliament during the Winter Session starting December 15. India should have a compact financial system instead of managements becoming irresponsible.
Elvidio Miranda, via email
