Indian banks a burden to economy, how to overcome

Indian banks a burden to economy, how to overcome

Banks are supposed to be enablers of economy. But instead to keep jobs of bank employees and fixed deposit holders, they impose high interest on public, and make whole financial system useless for economic growth.

In other countries

Interest rate are 1%, 2%, 4%.

In India poor indians have to pay

10%, 15% interest.

This is just to keep bankers job. This is the main reason for all Indian economic problems.

Below are methods to rectify this problem

- swap bank deposit with AAA rated corporate bonds.
- swap bank deposit with AAA rated shares.

This will release necessity of banks needing to charge high interest, to offset their need to pay high interest.

Now

  • Let RBI give banks loan at 1%.
  • Let Banks charge 2% as their profit (P1).
  • Let Banks charge 2% more to ensure quality of work, enablement of borrowers(E1).

Banks as enablers and empowerers

- The money E1, will be used by bank to empower, enable borrowers.
- The money E1, can be used by bank to reward, quality goods/service providers.

So with 5% interest we ensure

- Banks get 2% profit on loans.
- Banks working as productivity/efficiency validators of economy.
- This will ensure economic growth, job growth.

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