MUMBAI: Reserve Bank of India is "examining" the licensing framework for banks to align it with the evolving needs of the economy and is also reviewing the role of lenders in distributing insurance products, amid complaints of mis-selling.
In an exclusive interview to TOI, his first since taking charge in Dec, RBI governor Sanjay Malhotra said the regulator places "great importance on fair practice codes, consumer protection, and customer service," and that mis-selling of investment-linked insurance products is a valid ground for escalating complaints under the banking ombudsman scheme .
"We are reviewing the situation and if required, we will consider additional measures to tackle this issue," Malhotra said.
On the question of scaling up Indian banks, Malhotra said RBI is reviewing policies to ensure an adequate number of strong and trustworthy institutions. The central bank is also "examining" foreign shareholding norms and licensing rules as part of a broader review.
Addressing recent governance concerns, including those at IndusInd Bank, Malhotra assured that the banking system "is very robust and strong" and there are "no systemic risks or concerns."
The governor emphasised the need to improve KYC processes by making customer data available across financial institutions and promised that guidelines on re-KYC simplification would be issued "shortly".
India, he said, is well-positioned to retain its status as the world's fastest-growing major economy for the next decade, thanks to strong fundamentals, political stability, sound macroeconomic policies, and a favourable demographic profile.
Malhotra dismissed fears of fiscal slippage due to higher defence spending or trade-related concessions, citing the Centre's fiscal track record. "Even if there are minor slippages in some heads, they will be made good in others," he said.
On interest rates, he confirmed the central bank's pivot to an accommodative stance, but added, "The pace of any future cuts will be determined by the MPC."
Malhotra also said RBI has injected Rs 9 lakh crore of durable liquidity to support credit growth and aid transmission. "We will continue to provide liquidity to ensure monetary transmission," he said.
In an exclusive interview to TOI, his first since taking charge in Dec, RBI governor Sanjay Malhotra said the regulator places "great importance on fair practice codes, consumer protection, and customer service," and that mis-selling of investment-linked insurance products is a valid ground for escalating complaints under the banking ombudsman scheme .
"We are reviewing the situation and if required, we will consider additional measures to tackle this issue," Malhotra said.
On the question of scaling up Indian banks, Malhotra said RBI is reviewing policies to ensure an adequate number of strong and trustworthy institutions. The central bank is also "examining" foreign shareholding norms and licensing rules as part of a broader review.
Addressing recent governance concerns, including those at IndusInd Bank, Malhotra assured that the banking system "is very robust and strong" and there are "no systemic risks or concerns."
The governor emphasised the need to improve KYC processes by making customer data available across financial institutions and promised that guidelines on re-KYC simplification would be issued "shortly".
India, he said, is well-positioned to retain its status as the world's fastest-growing major economy for the next decade, thanks to strong fundamentals, political stability, sound macroeconomic policies, and a favourable demographic profile.
Malhotra dismissed fears of fiscal slippage due to higher defence spending or trade-related concessions, citing the Centre's fiscal track record. "Even if there are minor slippages in some heads, they will be made good in others," he said.
On interest rates, he confirmed the central bank's pivot to an accommodative stance, but added, "The pace of any future cuts will be determined by the MPC."
Malhotra also said RBI has injected Rs 9 lakh crore of durable liquidity to support credit growth and aid transmission. "We will continue to provide liquidity to ensure monetary transmission," he said.
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