In its efforts to strengthen the regulatory structure and assess the state of various industries, the Reserve Bank of India (RBI) in a meeting on June 11 told rating agencies to use social media and corporate filings to improve quality of entity ratings, instead of solely depending on company provided data.
In line with this, credit rating agencies (CRAs) have sought access to the central bank's Central Repository of Information on Large Credits (CRILC), Business Standard reported.
The central bank advised them to "pick up the signal and work on them before defaults happen".
Another suggestion was engagement with key stakeholders to "strengthen the rating processes".
The central bank also hinted at use of artificial intelligence (AI) and machine learning tools to analyse social media trends and alerts for improving "quality of insight".
The idea is likely to be discussed at a market regulators meeting alongside the Securities and Exchange Board of India, Insurance Regulatory and Development Authority of India and the Pension Fund Regulatory and Development Authority.
CRAs on their part voiced concerns over the rising number of "not cooperating" companies.
Source:- moneycontrol.com