1 / 4

Index of Service P roduction for B anking Sector in India  - work in progress

This work explores the development of the Index of Service Production (ISP) for the banking sector in India, examining the dominance of scheduled commercial banks, methods of measuring service output, and challenges faced in constructing the index. It delves into direct and intermediary services provided by banks, measurement approaches, and considerations for reference rates and deflators.

jodeep
Download Presentation

Index of Service P roduction for B anking Sector in India  - work in progress

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Index of Service Production for Banking Sector in India  - work in progress Dr. PradipBhuyan Director Banking Studies and Risk Modelling Division Dept. of Statistics and Information Management Reserve Bank of India, Mumbai

  2. Index of service production from banking in India  - work in progress • Banking sector in India is dominated by scheduled commercial banks (SCBs). • SCBs (including Regional Rural Banks) account for over 90 per cent of the total assets of the banking system in India. • Index of service production (ISP) is a composite indicator that measures the short term changes in the volume of service production during a given period vis-à-vis that in a chosen based period. • Conceptually it is akin to the index of industrial production (IIP). As IIP requires measurement of industrial output, ISP requires measurement of services output. The challenge is that the ISP deals with services output which is not always directly observable. ISP for banking (ISPB) refers to the quantity index of banking output. • Work on construction of ISPB for India would be initiated in RBI once the methodology is approved.

  3. Index of service production from banking in India  - work in progress • Banks provide both direct services as well as intermediary services. • Direct services pertain to issuing of letter of credit, bank guarantees, demand draft, foreign currency transaction services etc. Intermediary services pertain to financial intermediation services viz. to accept deposits and to give loans. Total output generated by banks is compiled by adding direct services output to that of financial intermediation services. • Output from direct services is generated based on the fee income received. Output from financial intermediation services cannot be measured directly. It is measured following a widely used method known as financial intermediation services indirectly measured (FISIM). • There is no standard prescription on a unique reference rate or a unique deflator to construct ISP.

  4. Index of service production from banking in India  - work in progress • Several reference rates and several deflators are under consideration for construction of the ISPB for India. • LaspeyresChain Link index is proposed to construct the ISPB for India. • Currently it is proposed to construct ISPB based on the data of Scheduled Commercial Banks in India based on balance sheet/P&L data. Thank You

More Related