infrastructure projects and in exceptional circumstances. apart from this, there are specific prudential norms for bank finance to nbfcs, call money / notice money borrowing and lending and inter - bank liabilities, etc. bcbs in the standards published on supervisory framework for measuring and controlling large exposures ’ ( the bcbs standards ) in april 2014 have stipulated that the sum of all the exposure values of a bank to a single counterparty or to a group of connected counterparties must, at all times, not be higher than 25 % of the bank ’ s available eligible capital base. as per the standards, the eligible capital base is also revised to the effective amount of tier 1 capital only. 36. in india, our effort has been to harmonise our guidelines with the international best practices and converge the same with the global prudential norms / standards. however, india, being an emerging economy with limited sources of funds to finance the growth process, relatively smaller capital base of the indian banks as also fewer number of corporate groups which can take up big ticket infrastructure and manufacturing projects and sudden growth in their size, has certain typical compulsions to meet. funding requirement for bis central bankers ’ speeches development of the infrastructure sector in india is huge. during the 12th five year plan, starting in the current year, this requirement is estimated to be approximately $ 1 trillion or rs 61 lakh crore. currently, a huge chunk of this financing responsibility is borne by the banks. the banking sector exposure to the infrastructure sector has grown from 3. 61 % of total bank credit as on march 2003 to approx 15. 09 percent of the total bank advances as on march 2014. 1 the group borrower limit in india is substantially larger in our country than the international norms due to the developmental needs of the country. keeping the group borrower limit at the level of single borrower limit, that too related to tier i than the total capital will severely constrain the availability of bank finance ( which is the major source of finance in india ) to these corporate groups and the infrastructure sector and thus hamper the growth of the economy. stricter group exposure limits would also leave surplus lendable resources with banks which may result in adverse selection. at the same time, high exposures to specific businesses or business groups impairs stability and results in excessive concentration of credit. thus, while we are aware of the need to reduce the group borrower limit, we have to take a considered view as to what extent and

regulatory approach of rbi towards non - banks has been to permit these entities to provide payment services which are fee - based without access to funds of the customers. indian regulations clearly spell out the role of telecom operators as service providers. however, keeping in view the penetration of mobile telephony in the country, they have been permitted to enable “ m - wallet ” facilities up to rs. 5000 ( about $ 100 ) in the interest of small retail payments. consumer protection issues 23. amongst the various objectives of regulation, consumer protection should take priority in the context of financial inclusion. in 2005, rbi took the initiative of setting up of the banking codes and standards board of india ( bcsbi ) in order to ensure that comprehensive code of conduct for fair treatment of customers was evolved and adhered to. the bscbi is registered as a separate society and functions as an independent and autonomous body. the bcsbi has evolved two voluntary codes – one which is a code of commitment setting out minimum standards of banking practices in dealing with individual customers. the other is a code of commitment to micro and small enterprises. individual complaints about non adherence to the code fall within the jurisdiction of the banking ombudsmen who also investigate individual complaints on non adherence to the various rbi guidelines on customer service. 24. other areas of consumer protection are related to excessive interest rates and harsh recovery practices. in particular the high rates of interest charged by non banking micro finance companies have attracted attention. views have been expressed that with the lending to mfis included in the priority sector, there should be a cap on the interest rates charged to the ultimate borrower. efforts at financial inclusion can be sustained only if the delivery models are viable and interest rate caps can be a deterrent. from a regulatory perspective, we emphasise transparency, creating better awareness, customer education and effective grievance redressal systems. 25. financial literacy has to be an integral part of financial inclusion and consumer protection. in fact, it should accompany and even precede the provision of financial services. several countries have a very clearly articulated vision and programs for financial literacy with initiative from the central banks and regulators. we too have a comprehensive financial literacy program. at the grass root level, financial literacy and grievance redressal is best delivered by arranging regular meetings of communities with people ’ s representatives, local officials and bankers, ngos and other stake holders. the banking ombudsman for the region and the major controlling offices of banks attend such