, Columnist
India’s Shadow Bank Tumult Casts a Widening Gloom
A wall of mistrust threatens to feed through to microlenders, hurting the poor and dragging down consumption.
After Modi's cash ban, this is the last thing small businesses need.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
It’s time India’s policy makers acknowledged the real problem facing the country’s shadow banks. What they are experiencing is no longer a vanilla liquidity shortage; the entire industry has crashed against a wall of mistrust.
On the other side of that wall are a clutch of wealthy property developers and their middle-class customers, as well as teeming multitudes of poor. Everyone is at risk.