Analysts give thumbs up to PM Narendra Modi-launched Retail Direct Scheme, Integrated Ombudsman Scheme

"With a view to achieving optimum utilisation of the digitalisation and IT savvy measures, the new initiatives of RBI announced by PM today shall go a long way in facilitating the Common Man on the investment avenues front."

"These schemes could encourage financial inclusion and bring more money into the capital market from the unorganized sector." PIB pic.

Prime Minister Narendra Modi on Friday launched two innovative customer-centric initiatives of RBI - 1 - Retail Direct Scheme and 2 - The Reserve Bank - Integrated Ombudsman Scheme, via video conference. Referring to the two schemes that have been launched today, the Prime Minister said that these schemes will expand the scope of investment in the country and make access to capital markets easier, more secure for investors. Retail direct scheme has given small investors in the country a simple and safe medium of investment in government securities. Similarly, One Nation, One Ombudsman System has taken shape in the banking sector with the Integrated Ombudsman Scheme today, he said.

According to analysts new initiatives of RBI announced by PM shall go a long way in facilitating the Common Man. Also, this scheme is a big step towards financial inclusion, ease of access, and a significant leap in digital India, focusing on Fintech. Here are details of what analysts said about Retail Direct Scheme and Integrated Ombudsman Scheme:-

Jyoti Prakash Gadia, Managing Director, Resurgent India, "With a view to achieving optimum utilisation of the digitalisation and IT savvy measures, the new initiatives of RBI announced by PM today shall go a long way in facilitating the Common Man on the investment avenues front and the complaint redressal mechanism in financial services. With the entry of small Retail investors for Government securities, the market will get broad based and volumes will increase, with more opportunities and ease of investments."

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"The single national level integrated digital portal for the RBI ombudsman scheme is expected to ensure uniformity and streamlined user-friendly mechana ism which will add value to the scheme and bring customer delight and financial inclusion. This may help in evolving better processes too, based on holistic analysis," Gadia added.

"Besides highlighting the coordinated approach of RBI and the Government for inclusive growth the PM also highlighted the efforts made in the direction of better credit culture eco system and strengthening of the Banking system," Gadia further said.

Sonam Srivastava, Co-founder, Wright Research, said, "This scheme is a big step towards financial inclusion, ease of access, and a significant leap in digital India, focusing on Fintech. In addition, small investors will have an opportunity to directly invest in Government securities that are as safe or safer than a Fixed deposit and more directly linked to the Government inte rates."

"These schemes could encourage financial inclusion and bring more money into the capital market from the unorganized sector. Furthermore, the One-Ombudsman scheme centralizes grievance redressal and focuses on preventing financial crime and catching cyber fraud through artificial intelligence promises to encourage investor trust," Srivastava said.

Dr. Ravi Singh, Head of Research & Vice President, ShareIndia, said, "The retail direct scheme offered by RBI is a good opportunity for retail investors to invest in government securities, sovereign bonds etc. It is the first time in India when retail investors will have an option of a simple and direct channel for investment in government securities. The government securities offer a low risk and low return on the investment as compared to investment in equity or asset. We advise retail investors must diversify their investment and go for this advantage to have a better and safe return."

Nitin Shanbhag, Sr. Executive group VP- Motilal Oswal Private Wealth, said, "The G-sec market is dominated by Institutional investors like Banks, Insurance companies, Mutual Funds, etc. with lot sizes of Rs. 5 crores & higher. Hence this segment was largely inaccessible to retail participants. G-secs witnesses highest volumes within the fixed income market since they offer a risk-free rate, hence no credit risk. Retail investors could thus far participate in G-secs only through Debt Mutual Funds, although with limited options. Further, in Debt funds, investors have to invest with a minimum 3 year investment horizon through the Growth option to qualify for long term capital gains @20% with indexation benefit. The RBI Retail Direct Scheme will enable retail investors to participate into G-secs across various tenors with flexible investment horizons and with the ability to get regular cash flows through risk-free coupons.”

Mandar Agashe, Founder, Vice-Chairman and MD, Sarvatra Technologies, said, “The 'One Nation-One Ombudsman' system is a fantastic way to strengthen the grievance redress mechanism for customer complaints against entities regulated by the RBI, such as banks, NBFCs, and payment service operators. With evolvement in new payment systems and interoperability among these technologies, the 'One Nation-One Ombudsman' will play a crucial role for the users. Customers will save time and money by having a single point of contact for filing complaints, tracking, and receiving feedback. Furthermore, by bringing in additional co-operative banks under the purview of RBI, it will strengthen the banking sector of India. It will also result in greater financial inclusion and setting up people-centred initiatives.With the rise in usage of UPI & other digital payments model, it is of utmost importance to have such digital measures which reduces burden & adds confidence to the populace especially to those who are tech-shy. It will lead to a rise in the adoption of digital payments across areas. Additionally, This decision will open new doorways for Indian investors, making capital markets more accessible.”

Addressing the event, the Prime Minister praised the Finance Ministry and institutions like RBI for their efforts during the pandemic. “This period of Amrit Mahotsav, this decade of the 21st century is very important for the development of the country. In such a situation, the role of RBI is also very big. I am confident that Team RBI will live up to the expectations of the country”, the Prime Minister said.

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