The low productivity trap of collateralised lending for MSMEs
The share of bank credit extended to MSMEs increased dramatically during the pan-demic. In this post, Harsh Vardhan discusses the the government guarantee of bank loans as a possible driver of this gr...
- Harsh Vardhan
- 07 October, 2022
- Perspectives
The disruptive market power of foreign portfolio investors in the face of tax threat
Foreign portfolio investors in emerging markets are known to exit host capital markets promptly if any policy changes impose additional costs. Based on an analysis of daily trading data during a perio...
- Hisham Farag Andrew Marshall Biwesh Neupane Suman Neupane Chandra Thapa
- 02 November, 2022
- Articles
How NBFCs are reinventing MSME finance
Even though micro and small enterprises make up over 99% of MSMEs in India, they receive a relatively small proportion of bank credit. Chandra and Muthusamy look at how lending to MSMEs has evolved ov...
- Rohit Chandra Nishanth Muthusamy
- 15 September, 2022
- Perspectives
Irrationality in financial decisions: A policy proposal
The high valuations of small- and mid-cap stocks in the Indian market seem indicative of irrational exuberance. In this context, Gurbachan Singh discusses the prevailing policy framework to deal with ...
- Gurbachan Singh
- 18 March, 2024
- Perspectives
16th Finance Commission: Towards vertical and horizontal balance
The recommendations of the recently constituted Sixteenth Finance Commission (FC16) will govern the sharing of revenues between the Union and states during 2026-2031. In this post, Ganguli and Sinha l...
- Barna Ganguli Bakshi Amit Kumar Sinha
- 13 February, 2024
- Perspectives
Emergence of a private credit market in India
The last few years have seen the growth of a private credit market in India, which offers financing to small and mid-sized firms with a relatively high default risk. In this piece, Datta and Sengupta ...
- Pratik Datta Rajeswari Sengupta
- 30 January, 2024
- Perspectives
A more focused RBI: Creating capacity to tackle ‘true’ market failure
Large, routine payments to the government by the public lead to liquidity crunch in the economy, necessitating interventions by the central bank. However, Gurbachan Singh argues that the RBI is better...
- Gurbachan Singh
- 10 January, 2024
- Perspectives
Debt markets’ response to mandatory corporate social responsibility
To examine the response of debt holders to the Mandatory Corporate Social Responsibility, this study by Jitendra Aswani looks at debt pricing for firms impacted by the Indian Companies Act 2013 and it...
- Jitendra Aswani
- 23 August, 2023
- Articles
Who holds sovereign debt and why it matters
Knowing who invests in sovereign debt and how they impact borrowing costs could help governments understand how costly it would be to raise new debt. This article constructs and analyses data on the c...
- Xiang Fang Bryan Hardy Karen K. Lewis
- 04 August, 2023
- Articles
The past and future of Indian finance
In the fourth article in the Ideas@IPF2023 series, Ruchir Agarwal describes the impact of two economic shocks – the financial crisis of 2018-20 and the Covid-19 pandemic – on the Indian financial ...
- Ruchir Agarwal
- 14 July, 2023
- Perspectives
Is the RBI’s commitment to inflation targeting credible?
Eight years after the adoption of Flexible Inflation Targeting (FIT) by the RBI, Garga, Lakdawala and Sengupta evaluate the success of this framework. They use two approaches to assess the credibility...
- Vaishali Garga Aeimit Lakdawala Rajeswari Sengupta
- 24 May, 2023
- Articles
UPI: A game changer towards achieving a cashless economy
Since the launch of the Unified Payment Interface (UPI), the volume of digital transactions in India has increased exponentially over the last few years. Shamim Ara highlights the trends in the expans...
- Shamim Ara
- 22 May, 2023
- Perspectives
The post-pandemic credit landscape in India
The economic shock caused by the Covid-19 pandemic and longstanding structural issues like the NPA crisis with its associated risk aversion in the banking sector resulted in low bank credit growth in...
- Rajeswari Sengupta Harsh Vardhan
- 08 May, 2023
- Articles
Bank failures: what’s the Fed’s role?
Silicon Valley Bank is the largest bank failure in the US since the 2008 financial crisis. Viral Acharya and Raghuram Rajan reflect on this and attribute the bank’s collapse to more than bankers’ ...
- Viral Acharya Raghuram Rajan
- 31 March, 2023
- Perspectives
The disruptive market power of foreign portfolio investors in the face of tax threat
Foreign portfolio investors in emerging markets are known to exit host capital markets promptly if any policy changes impose additional costs. Based on an analysis of daily trading data during a perio...
- Hisham Farag Andrew Marshall Biwesh Neupane Suman Neupane Chandra Thapa
- 02 November, 2022
- Articles
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India’s insurance sector: Challenges and opportunities
While India’s insurance sector has been growing dynamically in recent years, its share in the global insurance market remains abysmally low. This article traces the journey of the Indian insurance s...
- Kuntala Bandyopadhyay Saon Ray Vasundhara Thakur
- 31 August, 2020
- Articles
Financial inclusion in India: Progress and prospects
Financial inclusion is globally considered as a critical indicator of development and well-being of society. In this post, Srinivasa Rao traces the financial inclusion journey in India so far, and dis...
- K. Srinivasa Rao
- 11 July, 2018
- Perspectives
Thinking about financial sector reforms in India
A key element of the economy that needs to function well in order to facilitate India’s strong and sustained recovery from the pandemic is the financial system. In this post, Sengupta and Vardhan d...
- Rajeswari Sengupta Harsh Vardhan
- 15 November, 2021
- Perspectives