The committee which gave the concept of narrow banking in India
ARangarajan committee
BNarasimham committee
CTarapore committee
DVerma committee
Answer:
C. Tarapore committee
Read Explanation:
Narrow Banking:
- Narrow Banking refers to limited banking activity.
- In order to avoid bad debts, the banks do only mobilise deposits, lend or invest money with in a particular region or invest in low risk asset like Govt. securities.
- This banks will not provide term loans, Working Capital Loans, Agricultural loans etc.
- Tarapore committee (committee on capital account convertibility) gave the concept of narrow banking in India.
- They do not take any risk and loans are provided on the basis of security.
- It was suggested as a solution of the problem of high NPAs and related matters.
- Narrow banking can ensure the regular deployment of funds in low risk liquid assets.
- This banking system are expected to remove the problems of bank failures and the consequent systemic risks and loss to depositors.