Recommendations of Nachiket Mor committee recommendation on comprehensive financial services for small businesses and low-income households:-
1) Each low-income household and small business should be provided with convenient access to formally regulated lenders who have the ability to assess and meet their credit needs and offer a full-range of suitable credit products at an affordable price.
2) The committee has set January 1, 2016, as the deadline for achieving this. By that date, each district and every significant sector (and sub-sector) of the economy would have a credit to GDP ratio of at least 10 per cent.
3) The committee was hopeful that by January 1, 2016, each district would have a total deposits and investments to GDP ratio of at least 15 per cent.
4) By that date, each district should have a total term life insurance sum assured to GDP ratio of at least 30 per cent. This ratio should increase every year by 12.5 per cent with the goal of reaching 80 per cent by January 1, 2020.
5) To reach the target, every resident should be issued a Universal Electronic Bank Account (UEBA) automatically at the time of receiving his/her Aadhaar number. (UEBA) should attract no account opening fee, it said. The bank, however, would be free to charge for all transactions.
6) The committee recommended that the RBI issue a circular indicating that no bank could refuse to open an account for a customer, who had adequately fulfilled KYC (know your customer) requirements.
7) On priority sector, the committee recommended adjusted priority sector lending target of 50 per cent against the current requirement of 40 per cent with sectoral and regional weight age based on the level of difficulty in lending.
8) Committee advocated regulatory convergence between banks and NBFCs based on the principle of neutrality with regard to classification of non-performing assets and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 eligibility.
9) The committee also suggested the creation of a state finance regulatory commission (SFRC).