Retail direct, integrated ombudsman scheme will make country stronger: Modi

Prime Minister Narendra Modi on Friday launched the Reserve Bank of India’s (RBI) ‘retail direct’ platform and ‘integrated ombudsman scheme’ and said this will ensure the safety of a common man’s investment, coupled with high returns, as well as make available funds for the government to invest in infrastructure and other needs of the country.

Through retail direct, an individual investor can directly invest in government securities (G-sec), in a system facilitated by the Reserve Bank, without any fees, and without the need for a fund manager. Since they are government-guaranteed and are the highest asset class that a sovereign can offer, the investment is secure.

The strength of a democracy lies in how easy and quick the grievance redressal mechanism is. In that aspect, the RBI’s integrated ombudsman scheme is a major step, the Prime Minister said in his speech delivered online.

“In every government security, there is a guaranteed settlement. Small investors will get assurance. People will get good returns, and the government will get the required funds to develop the country. This is Atmanirbhar Bharat – where the citizens and the government work together for a common goal,” the prime minister said.

“The role of the government securities market in India’s development is well known. Now that the country is making rapid strides in physical and digital infrastructure, the participation and cooperation of small investors will go a long way in that effort,” the prime minister further said in his speech.

“So far, our middle class, government servants and senior citizens had to go to banks, insurance or mutual funds to invest in government securities. Now they can invest directly and safely from the convenience of their home. This is the best way to invest. The ease of investment and safety will develop the wealth of the nation,” Prime Minister Modi said, adding the substantial benefit accrued will boost the common man’s confidence in financial savings.

At the same time, the prime minister stressed the need for financial education so that the common citizens can understand the nitty-gritty of the bond market.

The Prime Minister said with the integrated ombudsman scheme of the RBI, a common man will not have to run around to lodge his complaints. No matter the nature of the financial grievance, the complainant can lodge it online, and track it online for a time-bound resolution process.

This one nation –one ombudsman scheme will directly help 440 million loan accounts and 2.2 billion deposit account holders, he said.

“All RBI regulated entities will be covered by this. Any complaint by account holders can be resolved through this one platform. In case of online fraud, cyber fraud, etc., the RBI will massively use artificial intelligence. Banks and investigative agencies will coordinate in the shortest time possible to resolve a fraud,” the Prime Minister said.

This will not only help in preventing fraud, but will also improve digital penetration and customer confidence in the banking system will increase.

“A strong banking system is important for a strong economy,” the Prime Minister said.

The prime minister said the Indian startups are becoming global champions. “Our youth has made India a global power for innovation. The regulatory system should help create the ecosystem to make our financial system world-class and maintain it that way,” he said.

“We must also focus on investors, and continue to keep this country an investor-friendly destination,” the prime minister said.

At the same time, Prime Minister Modi lauded the RBI for its proactive and sensitive role played during the Coronavirus (Covid-19) pandemic, in coordination with the government and finance ministry.

“In this challenging corona environment, the finance ministry, and the RBI have done a very praiseworthy job. This decade of ‘Amrit Mahotsav’ is very important for the country’s development. In this, the RBI’s role is very big and important. The RBI has always risen up to the occasion, and I am confident the RBI will again emerge successfully.”

In the past year, the banking and financial system’s stability was protected. The technological improvement showed its efficacy during the Covid-19 period. The government decisions were boosted by the RBI actions, he said.

“The way the RBI governor and his team handled the Covid-19 pandemic, needs to be praised. I congratulate the entire team for this,” said the Prime Minister.

“RBI has strengthened India and will continue to do so,” prime minister Modi said.