The rating model will use artificial intelligence and machine learning to analyse the data collected
The Centre is considering the establishment of a special purpose vehicle (SPV) to monitor, screen, and rate commercial borrowers, as per an Economic Times report.
One of the initiatives the new government will work on in its first 100 days, the SPV, similar to the Goods and Services Tax Network (GSTN) will form a database compiling information from public sector banks (PSBs).
The entity will be tasked with operating the complex state and central tax systems on a single platform and will use artificial intelligence and machine learning to analyse the data collected, the paper noted.
GSTNs are non-profit, non-government private companies, in which the Centre holds 24.5 percent equity; state governments and the empowered committee of state finance ministers hold 24.5 percent; and the remaining 51 percent is held by non-government financial institutions.
KV Subramanian who is Chief Economic Advisor to the Finance Ministry told the paper it was too early to comment, and Moneycontrol could not independently verify the news.
The government is also mulling change in banking laws to keep a check on loan evergreening, it added.
The new norms will likely mandate companies to report within a week frauds on bank loans to the Corporate Affairs Ministry if the company is unlisted, and to Sebi, if the company is listed. At present, companies are required to immediately report defaults on bonds to Sebi. The rule, however, does not apply to bank loans.Subscribe to Moneycontrol Pro and gain access to curated markets data, exclusive trading recommendations, independent equity analysis, actionable investment ideas, nuanced takes on macro, corporate and policy actions, practical insights from market gurus and much more.
