Bank for International Settlements released a consultative document in December 2015, entitled: “Guidance on the application of the Core principles for effective banking supervision to the regulation and supervision of institutions relevant to financial inclusion” inviting comments before 31st March 3016. This document meant for effective supervision of the non-banking financial intermediaries is the outcome of a survey Basel Committee on Banking Supervision (BCBS) conducted a range of practice survey in 2013 (ROP) on the regulation and supervision of institutions of relevance to financial inclusion and on financial consumer protection across 59 jurisdictions with 52 respondents.
I have kept the following ground rules in view while reviewing the Draft Document:
Ø Cost of compliance must be less than the cost of avoidance.
Ø Regulations and rules must be simple and straight forward inviting easy compliance.
Ø Multiple regulators impacting on financial inclusion agenda should be able to strengthen and accelerate the implementation.
Ø Financial Institutions engaged in financial inclusion should be able to deal with it as a portfolio for generating data and information required for proper regulation.
Ø Instruments, tools and techniques of supervision should be uniform across the nations.
Ø Financial Inclusion achievements should be subject to social audit as well.