Fiscal policy is used by governments to exert influence on the level of aggregate demand in the economy, aiming to achieve specific economic goals such as price stability, full employment, and economic growth. Keynesian View and Fiscal Expansion Budget Surplus and Stabilization Debate on Fiscal Stimulus Classical View and Net Exports Potential Inflationary Effects Lag … Read more
Governments fund their diverse expenditures, including military, police, education, healthcare, and welfare benefits, through various methods: Taxation: Government revenue is primarily derived from taxes imposed on individuals and businesses. Seigniorage: Governments benefit from the practice of printing money, known as seigniorage. Borrowing: Governments can borrow from the population, abroad, or by issuing bonds such as … Read more
Depending on the state of the economy, fiscal policy can be directed towards different objectives, such as mediating inflation to restrict economic growth or stimulating economic growth by reducing taxes and encouraging spending on various projects. The three stances of fiscal policy are as follows: Neutral Fiscal Policy: Expansionary Fiscal Policy: Contractionary Fiscal Policy: Considerations … Read more
When considering the choice between monetary and fiscal policy, it’s important to note that each has its own set of advantages and limitations. Advantages of Monetary Policy Advantages of Fiscal Policy Combined Approach and Long-Term Effects A combination of aspects from both policies has been adopted by the US to address economic problems. While both … Read more
In economics and political science, fiscal policy refers to the use of government revenue collection (taxes or tax cuts) and expenditure to influence a country’s economy. This approach developed as a response to the Great Depression of the 1930s, when the previous laissez-faire economic management approach became unworkable. The foundation of fiscal policy lies in … Read more
Non-Banking Financial Companies (NBFCs) in India serve diverse financial roles, categorized as follows: 1. Investment and Credit Company (ICC) 2. Infrastructure Finance Company (IFC) 3. Infrastructure Debt Fund: Non-Banking Financial Company (IDF-NBFC) 4. NBFC-Factors 5. Gold Loan NBFCs in India 6. Residuary Non-Banking Companies (RNBCs) 7. Account Aggregators (AA) New Categorization of NBFCs by RBI … Read more
The regulation and evolution of Non-Banking Financial Companies (NBFCs) in India have been shaped by several legislative amendments and committees: Reserve Bank Amendment Act, 1963 Committees and Legislative Actions James S. Raj Committee Chakravarty Committee These legislative actions and committee recommendations have played a pivotal role in shaping the regulatory framework and growth trajectory of … Read more
A Non-Banking Financial Company (NBFC) is a company registered under the Companies Act, 1956 of India. NBFCs engage in various financial activities such as loans and advances, acquisition of shares, stocks, bonds, hire-purchase, insurance, or chit-fund businesses. However, they do not include institutions primarily involved in agricultural, industrial activities, sale/purchase of goods (excluding securities), providing … Read more
The Reserve Bank – Integrated Ombudsman Scheme, 2021 (the Scheme) was launched on November 12, 2021, by Prime Minister Shri Narendra Modi. This Scheme integrates the three existing Ombudsman schemes of the Reserve Bank of India (RBI): Legal Framework The Scheme is framed by the RBI under the following acts: Purpose The Scheme aims to … Read more
The Banking Ombudsman is a quasi-judicial authority established in 2006 by the Government of India to resolve complaints from bank customers regarding certain services provided by banks. The Banking Ombudsman Scheme was initially introduced in 1995, revised in 2002, and the current scheme has been operative since January 1, 2006. This replaced the Banking Ombudsman … Read more