Nearly a year after introducing it in the Lok Sabha, the government today withdrew the Financial Resolution and Deposit Insurance or FRDI Bill following widespread concerns over certain provisions.
The main concern was over the proposed ‘bail-in’ clause to resolve a failing bank and insurance cover on bank deposits.
ALSO READ: Indra Nooyi quits PepsiCo; steps down as CEO after 12 years
A proposal to withdraw the bill was today moved by Minister of State for Finance Pon Radhakrishnan and was approved by the House.
The FRDI Bill sought to make a law for creation of an independent resolution corporation to carry out speedy and efficient resolution of financial firms in distress, among others.
Finance Minister Piyush Goyal had informed the joint parliamentary committee set up to look into the Bill about various reasons for deciding to withdraw the bill.
The stakeholders, including the public, had raised apprehensions relating to the provisions of the FRDI Bill like the use of bail-in instrument to resolve a failing bank and the adequacy of deposit insurance cover, Goyal had told the panel.