The Reserve bank of India has rebuked banks for not having an effective mechanism for sharing information on loans.
RBI in its monetary policy statement drew attention to the restructured loans and increase in the non-performing assets of the banks. The statement also mentioned that due to the lack of effective information sharing mechanism, the asset quality of the bank has been deteriorating. Though, RBI has issued specific instructions for this in September and December, 2008.
Reserve Bank of India has asked banks to form an effective mechanism for information sharing by December. RBI further mentioned that any approval of new loan, Renewal of loan or ad hoc loan provided to new or existing borrowers with effective from January 1, 2012 should only be done after the banks have obtained an effective mechanism for sharing information.