Online petition against FRDI Bill gets thousands of signups
An online petition against the bail-in provision in the FRDI bill has got thousands of signatures even as the finance ministry said that the proposal, under consideration of a joint parliamentary committee, is depositor friendly and provides more protection.
An online petition on Change.org against the Financial Resolution and Deposit Insurance (FRDI) Bill, 2017, has gone viral on social media, seeking public support against what it terms as an attempt to “allow a government entity to use depositors’ money to save a bank on the verge of bankruptcy”.
This bill gives power to a government entity to use depositors money to save a bank on the verge of bankruptcy. This government entity can declare the bank doesn’t owe you any money though you have deposited your hard earned money with it,” the petition said.
Financial Resolution and Deposit Insurance (FRDI) Bill
- The FRDI bill, introduced in the Lok Sabha on August 11, 2017, is under consideration of the joint committee of Parliament. The panel is consulting all the stakeholders on the provisions of the legislation.
- According to the finance ministry, FRDI Bill, 2017 seeks to protect customers of financial service providers in times of financial distress.
- It also aims to inculcate discipline among financial service providers in the event of financial crises, by limiting the use of public money to bail out distressed entities.
- The Bill would help in maintaining financial stability in the economy by ensuring adequate preventive measures, while at the same time providing the necessary instruments for dealing with crisis events.
- The Bill aims to strengthen and streamline the current framework of deposit insurance for the benefit of retail depositors.
- Further, it seeks to decrease the time and costs involved in resolving distressed financial entities.
- Once enacted, a resolution corporation will be setup to strengthen the stability and resilience of the entities in the financial sector.