Draft Omnibus Framework for recognizing SROs

Draft Omnibus Framework for recognizing SROs mind map
Reserve Bank of India
RBI's role
Regulating currency and credit system
Maintaining financial system stability
Need for the framework
Growth of REs
Increased use of innovative technologies
Enhanced customer outreach
Self-Regulatory Organizations (SROs)
Organizations regulating professions or industries
Non-governmental organizations
Create rules for order in businesses
Role and Effectiveness
Enhancing regulations' effectiveness
Providing technical expertise
Aiding in policy framing
Complementing regulatory frameworks
Characteristics of an SRO
Credibility, objectivity, responsibility
Authority from membership agreements
Governance standards enforcement
Surveillance methods for monitoring
Objectives of the SRO
Overarching objectives
Enhancing sector professionalism
Compliance, innovation, ethical conduct
Development of self-regulatory principles
Specific objectives
Promoting compliance culture
Representing members' collective voice
Sharing sectoral information with RBI
Encouraging research and innovation
Responsibilities of the SRO
Towards Members
Promoting best business practices
Establishing minimum benchmarks
Protecting stakeholder interests
Disseminating sector-specific information
Promoting statutory/regulatory knowledge
Towards the Regulator (RBI)
Informing RBI of sector developments
Assisting RBI in compliance and development
Acting as a bridge between REs and RBI
Eligibility Criteria for SROs
Not-for-profit company
Adequate net-worth and infrastructure
Professional competence and integrity
Representing the sector
Fit and proper status for recognition
Governance Framework
Professional management
Transparent practices
‘Fit and proper’ criteria for Directors
Adequate human and technical resources
Application for Recognition
Process and Documents
Memorandum and Articles of Association
Constitution of Board and Directors
Membership criteria roadmap
Authorizations and powers of office bearers
Conditions for Recognition
True and non-misleading information
Adherence to prescribed requirements
Periodic review by RBI
Right of RBI to revoke recognition
Recent News
Announcement date
October 06, 2023
Feedback submission deadline
January 25, 2024
RBI's call for comments
Inviting public and stakeholder feedback
Indian Context
Impact on Indian financial sector
Enhanced self-regulation standards
Addressing challenges of expanding REs
Promoting transparency and innovation
Ensuring compliance and consumer protection

In simple terms, the Draft Omnibus Framework released by the RBI aims to establish improved standards for self-regulation in the financial sector by recognizing and regulating Self-Regulatory Organizations (SROs). These SROs are non-governmental bodies that will create rules to ensure order and ethical practices among businesses and organizations in various sectors. The framework outlines the roles, responsibilities, eligibility criteria, and governance standards for these SROs. It is part of RBI’s effort to enhance regulatory efficiency, foster innovation, and protect stakeholder interests in an increasingly complex and technologically advanced financial landscape.

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