Enforce Department (ED) will speed up regulatory compliance of banks.
It will primarily deal with issues related to penalties imposed on banks for violation of norms.
At present penalties are decided by banking and non-banking supervision departments of RBI.
Background
Regulation, enforcement and surveillance are three most important facets of financial sector oversight mechanism.
Regulations determine framework in which financial entities function so that transparency, prudence and comparability are ensured on one hand and customer interests are protected on other.
Surveillance is process through which adherence to regulations is monitored.
Currently RBI has a clear demarcation of surveillance and regulatory functions, but it was not in case with enforcement of rules.
Recent steps by Union Government to reform banking sector are
Bank Board Bureau (BBB) was established by replacing Appointments Board.
In Union Budget 2017 - 18, an infusion of ₹ 10,000 crore in public sector banks for recapitalization purposes.
Insolvency and Bankruptcy Board (IBBI) of India notified three sets of regulations under Insolvency and Bankruptcy Code, 2016 to deal with non-performing assets.
About RBI
Central banking organization in India.
Controls financial policy around Indian rupee.
Founded on 1st April 1935 during the British Rule.
Nationalized on 1st January 1949.
Four headquarters are at Mumbai, Kolkata, Chennai, and New Delhi.
Leading member of Alliance for Financial Inclusion.
It has 19 regional offices, most of them in state capitals and 9 Sub-offices.