Budget 2020: Greater allocation for infrastructure could spur employment growth, says IBA

The Union government on Monday announced a slew of measures to protect commercial decisions taken by banks. Ahead of the 2020 Union budget announcement, Sunil Mehta, CEO of Indian Banks' Association (IBA), discussed the development and his expectations from the February 1 budget.

On the pending vigilance cases, he said: “IBA has persuaded the government to bring some improvement into the existing vigilance mechanism that will help the lenders in taking a more effective decision and a conscious business decision because now the government has paved the way for protecting the interest of the bankers as a genuine decision-maker of the business. The basic changes that have been brought down by the circular issued by the DFS

Mehta added: “The government has come out with the guidelines that all these cases now first will be examined by the banks internally. If they suspect any fraud then there is a board which has been formed by the CVC, that board will examine it and if they perceive that yes, materially there is a fraud, which need to be classified as a fraud and action has to be taken then it will proceed forward. It will not be very generalised, it will be very specific to limited cases where it is considered that there is a deliberate, conscious attempt on the part of the corporate or a person to divert the funds and to defraud the banking system.”