Last week, the Central Information Commission sent a showcause notice to the Reserve Bank of India about a controversy that has been raging since 2015. Despite several orders from the commission and a sharp rebuke from the Supreme Court, the RBI has been refusing to part with information about large willful defaulters. The central bank claims that doing so will compromise the economic interests both of the country and the banks.

As it turns out, its objections were discussed – and dismissed – by the Supreme Court in 2015, which said that the RBI was duty bound to release the information.

The RBI has said that it needs till November 26 to reply to the commission’s showcause notice. It is employing a flimsy ruse. The Chief Information Commissioner Satish Acharyalu is retiring on November 20. The RBI seems to believe that it can weather the storm till his retirement and return to the status quo thereafter.

But the RBI’s position is becoming more untenable. On Sunday, NDTV reported that four big public banks have already revealed information about defaults on their websites. In other words, much of the information sought from the RBI is already available in the public domain for some banks. This has not sparked the serious economic consequences that the RBI claimed it would. This negates the RBI’s argument that such information would embarrass individual banks and compromise them because panic would set in about their financial health.

Over the last decade, India’s banks have been facing a serious bad debt problem. Many of them allegedly lent money indiscriminately without analysing the credit-worthiness of their clients. This has placed a huge burden on tax payers, who will have to eventually bear the loses of the public banks.

The RBI seems to have forgotten that opaque functioning is what led to this mess in the first place. In 2015, the Supreme Court said:

“We have surmised that many Financial Institutions have resorted to such acts which are neither clean nor transparent. The RBI in association with them has been trying to cover up their acts from public scrutiny. It is the responsibility of the RBI to take rigid action against those Banks which have been practising disreputable business practices.”

Making information about large defaulters public will also help understand why India’s Micro, Small and Medium Enterprises sector is in doldrums. The Opposition has alleged that by prioritising big borrowers without due diligence, the banks have seriously harmed small industries. In this, the central government is also at fault. Transparency in this matter is vital for the health of the economy.