Bill for NFIR at advanced stage; likely to be introduced in next session: DEA Secretary

The Bill for setting up a National Financial Information Registry (NFIR) is in the advanced stage of preparation, and it may be introduced in the next session of Parliament, Economic Affairs Secretary Ajay Seth has said. “It is at an advanced stage. It is in the closing stages of inter-ministerial consultation. We will finalise the Bill soon,” he told PTI in a post-budget interview. However, he said, it cannot be introduced in the ongoing session of Parliament but may be in the next session.

The objective is to build a public infrastructure for credit-related information, and the right information can be made available by the NFIR to lending agencies.

A National Financial Information Registry will serve as the central repository of financial and ancillary information. This will facilitate the efficient flow of credit, promote financial inclusion, and foster financial stability.

The passage of the Bill will enable in setting up of a registry and thus help in consolidating all financial information and facilitating financial inclusion, and take the Indian economy onto a faster growth trajectory. The Budget 2023-24 proposed setting up of NFIR as a central repository of financial information to facilitate the efficient flow of credit, promote financial inclusion and foster financial stability in the country. Talking about growth projection in the Budget, Seth said it has assumed a reasonable nominal GDP growth rate of 10.5 per cent, as a higher assumption could have led to a larger fiscal deficit. “As far as the current year is concerned, fiscal prudence places the demand on us that we are realistic or a bit conservative in assuming what the potential revenues may be while at the same time providing adequate provisions for productive priorities of the government. That is what this Budget does,” he said.

Compared to the interim Budget, he said, there is a higher provision of about Rs 90,000 crore, including for newer schemes.

In that context, he said, “10.5 per cent, we feel, is a reasonable estimate of nominal growth in the economy. Because any higher assumptions would then require us to assume more revenues to come and if those revenues don’t come in, then we end up with a higher fiscal deficit”.

That means more borrowings, and it creates its own set of problems, he said, adding that it is better to have conservative estimates.

Buoyed by improvement in revenue collection, the government has lowered the fiscal deficit target to 4.9 per cent for the current financial year against 5.1 per cent estimated in February’s interim Budget.

However, the Budget retained the fiscal deficit estimate at 4.5 per cent for 2025-26 announced in February.