, which brings down the credit score of the entrepreneur and hinders the ability of the formal financial system to lend to them. banks, on their part will need to leverage on modern technology algorithms and big data so that they can differentiate between a good borrower and a not so good one even in the absence of conventional documentation. 17. having analysed various impediments in finance to the sector let me dwell on some of the steps taken by rbi, government of india and other apex institutions in bridging these gaps. ( i ) access / availability rbi has initiated several measures to improve the availability of banking services, especially in the rural and far - flung areas where access to formal finance is arduous. 18. new institutions : as you are aware, two new universal banks have started operations while in - principle approval has been granted to 10 entities to set up small finance banks that would primarily focus on lending to unserved and underserved sections including small business units, small and marginal farmers, micro and small industries and unorganized sector entities. these small finance banks have been mandated to extend 75 per cent of its adjusted net bank credit ( anbc ) to the sectors eligible for classification as priority sector lending ( psl ) by the reserve bank. at least 50 per cent of its loan portfolio should constitute loans and advances of up to rs. 25 lakh. many of the sfbs have prior experience of working with small bis central bankers ’ speeches businesses as mfis / nbfcs and we believe that they will be able to bring in technology backed innovative last mile practices to serve their customers. 19. increased branch penetration / specialized branches : rbi has advised banks to set up ‘ brick and mortar ’ branches in villages with population of more than 5000 in a phased manner. coupled with a more mature banking correspondent mechanism, this would give considerable fillip in meeting the banking needs of the msmes particularly in rural areas. besides, creating presence of physical branch, there is also a need to have large number of bank officials with appropriate skill sets and knowledge to handle the life cycle needs of the small businesses. already, public sector banks have established specialized msme branches in every district to cater to the needs of the small businesses. we are already working towards improving the skill sets and entrepreneurial sensitivity of the field level functionaries. 20. p2p lending : new players have entered the msme lending landscape in form of p2p companies. these entities use an

sets of issues : 1. the landscape for otc derivatives in india 2. regulatory concerns and steps taken 3. the roadmap for otc derivatives 4. the development of markets in india. bis central bankers ’ speeches the landscape for otc derivatives in india the primary otc derivatives in india : interest rate derivatives – interest rate swaps ( irs ) and forward rate agreements ( fra ) ; fx derivatives - fx forward, options and swaps. the irs and fra were introduced in july 1999 to help banks and pds to better manage their interest rate risk in the wake of deregulated interest rate regime. swaps having explicit / implicit option features such as caps / floors / collars are not permitted. currently, there are four benchmarks used in rupee irs, viz. mibor, mifor, inbmk, miois. the trading is mainly confined to mibor benchmark. the average daily traded volume in the mibor swap over the last three years is placed at rs. 8, 873 crore, quite comparable with that of the g - secs at rs. 10, 937 crore. often the daily traded volume in mibor swaps remained above that of the g - secs. of the mibor swaps, the swaps on overnight mibor, i. e. ois, is the most actively traded instrument. the ois trades are mainly confined to 1 - year tenor, followed by 2 - year and 5 - year tenors. the relatively high volumes suggest that the product is providing a useful way of hedging against interest rate risk. however, it needs to be pointed out that the market is mainly driven by inter - bank transactions. customer - related transactions comprise only about around 1 per cent of the volume. also, the participation profile remained skewed. the share of foreign banks is at above 80 %, whereas the share of public sector banks is at around 1 %. the ois curve has been below the g - sec curve for most of the time. in the otc fx derivatives, forwards have been the most widely used instrument followed by swaps and options. usd - inr futures had picked up substantial volume since their introduction in august 2008, but the forwards still possess the dominant market share. it is evident that hedgers generally still prefer otc forwards to futures, as these provide the benefit of customization, does not involve cash flows related to daily mtm margining and are linked to