Take IT gains to rural areas: RBI

By agencies   |   Thursday, 21 July 2005, 07:00 Hrs
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CHENNAI: The Reserve Bank of India has released its Financial Sector Technology Vision Document for the period 2005-08. The document aims to provide inputs for banks on the RBI's medium term policy perspectives in this area.

The Vision document acknowledges that electronic filing of regulatory information has not been fully achieved as e-reporting skill among banks is still at a rudimentary stage. It says that the currently existing off-site surveillance systems do not have authentication systems.

It points out that the risk management systems, and the preparedness for implementation of anti-money laundering and Basel-II norms, in terms of technology, is still in its infancy.

The document underlines the challenges posed by the presence of varied types of banks and the different reporting requirements that make the adoption of a generic architecture for all banks difficult.

The document says, "The major challenge staring at bankers in India relates to the need to introduce innovative, customer friendly products and services for which newer technologies have to be brought in multiple areas to reduce the overall transaction costs."

It draws attention to the fact that IT implementation has traditionally targeted metros and urban customers.

It says, "The time has now come to make the benefits of IT penetrate to the rural population as well. There may be also a need to provide for multi-lingual facilities, which is a migration from the existing English-only paradigm, in a manner akin to some of the other large countries such as China, Korea and Japan."

The document calls for the setting up of business continuity plans and disaster recovery systems, given the large-scale dependence on IT.

With regard to government-related transactions, the Vision document calls for computerization of respective government departments. This would enable reduction in delay in providing service to customers as well as enable faster dissemination of information.

The document noted that the Online Tax Accounting System (OLTAS) for collection of direct taxes was stabilizing well and enabled quicker transfer of tax proceeds to government.

Listing some of the emerging challenges in this area (government transactions), it said, that procedural changes would be required and amendment to treasury rules would be needed for e-governance. It also pointed out that cross-certification of digital signatures would be required since the certification authority for the banking sector and Government were different.

The document, laying a roadmap for the above, said that the retail activities of the RBI were being hived off or entrusted to a separate set of banks as for example, in the case of the new MICR-based check-processing centers.

A time-bound plan would be formulated to ensure their complete IT-based functioning, the document said.

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