With reference to ‘Managing operational risks in financial sector’ (March 15). Despite the norms and procedures in place, many financial entities are falling prey to financial embezzlement and credibility losses. The quality of compliance is crucial to prevent the risks from turning into financial loss. The compliance culture needs to be strengthened to prevent the human capital of the organisation from skipping the compliance of various norms and guidelines.

The operational risks are huge in the case of banks and non-banking financial entities. The quality of credit appraisal, pre- and post-sanction management of the credit and compliance with several regulations must be ensured at every stage of the credit delivery. A meaningful periodical review of the loans, advances and investments is needed to ensure the quality of the assets.

Corrective actions within the regulations are essential not only to sustain the performance of the assets but also to restrict the growth of unutilised capacity in various segments of the economy. As risks are part and parcel of financial transactions it is impossible to avoid risks, but by executing appropriate policies and raising the standard of the governance iit is easy to mitigate the risks.

VSK Pillai

Changanacherry (Kerala)

RBI’s welcome move 

This refers to the report ‘RBI unveils new framework for microfinance lenders’ (March 15). Even after accepting the need to support small entrepreneurs by providing bank finance through various channels, costs and terms of such services remained a grey area. After February 2021 Monetary Policy Announcement, RBI followed up its commitment to bring some order in areas where bank finance is involved by obtaining stakeholders’ views on the proposed measures.

If the stakeholders take the RBI move in the right spirit and cooperate, this could be a welcome new beginning.

MG Warrier

Thiruvananthapuram

Regulation for vehicle aggregators

With reference to the article ‘Reining in vehicle aggregators”’, vehicle aggregators have changed the whole dynamics of mobility in the last few years. As the intention behind creating a regulatory framework is noble and with a long-term view in mind as far as the environment is concerned, it should be welcome by all stakeholders.

But at the same time, we need to be aware that the cost of buying an electric vehicle and charging infrastructure, which are areas of concern. The Delhi Government should have a detailed discussion with key stakeholders for a seamless transition to electric vehicles.

Also addressing issues like last minute cancellation by drivers , specially during odd hours when availability of cabs is minimal need to be addressed.

Bal Govind

Noida

Fuel price woes

Apropos 'Pricier crude, metals take WPI to 13%; CPI at 8-month high' ( March 15), while both the numbers are yet to factor in the higher crude prices as retail prices of petrol and diesel have not been revised since November 4, 2021, there are likely to impact inflation on a staggered basis.

With Brent crude prices ruling over $110 a barrel and retail and wholesale inflation surging, the Centre has no option but to raise fuel prices.

Since the extant rising trend in both the WPI and CPI is highly unlikely to see any ‘reversal’ in near future, the RBI’s MPC should consider hiking the ‘Repo and Reverse Repo rates’ sooner than later, as suggested by some financial experts.

SK Gupta

New Delhi

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