New Delhi:
The Reserve Bank of India (RBI) aims to become a role model for central banks of developing countries in the year 2035, i.e. in the 100th year of its establishment. RBI Governor Shaktikanta Das said that the RBI@100 agenda contains everything that we want to do. This includes increasing India’s global presence, establishing itself as a leader in monetary policy and promoting financial inclusion. In an exclusive interview with NDTV, Shaktikanta Das explained how RBI will be prepared for the future.
In an exclusive interview with NDTV Editor-in-Chief Sanjay Pugalia, RBI Governor Shaktikanta Das said, “RBI was established in 1935. This year we are celebrating the 90th year. We have made an agenda – RBI at 100. It has a complete list of what we have to do in the next 10 years in many sectors. The agenda has all the details of what we have to achieve by 2034. Our focus is on that. Our goal is to keep RBI ‘future ready’.”
Our aim is to explain RBI in common man’s language
The RBI governor spoke in detail about India’s economy, rising inflation rate, GDP growth rate, use of AI in the banking system, cyber security and financial stability. Shaktikanta Das (RBI Governor Shaktikanta Das) has emphasized on explaining the banking system in simple language. Shaktikanta Das said, “Our goal is to explain RBI in the language of the common man. Therefore, efforts are being made to present the work of RBI in simple language. So that every person can know and understand his banking system.”
After Covid, the banking system faced big challenges
Shaktikanta Das said, “The Reserve Bank of India started working in 1935. RBI has a big role in UPI payments. We have faced the challenges of the Corona epidemic and its aftermath well. The banking system faced big challenges in different phases of Covid. The world also faced many other challenges. The impact of the Ukraine war was also big. But the government and RBI worked well together.”
RBI does not give profit or loss to the government
Shaktikanta Das says, “RBI’s focus is mainly to ensure the financial and monetary stability of the country. We are a non-profit organization. Therefore, we do not give any profit or loss to the government every year, but transfer the surplus.”
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What did the RBI governor say on inflation rate
On the rising inflation rate, the RBI Governor said, “We never said that the inflation rate will go below 4%. Our target is to remain close to 4%. A one-off reading of 4% cannot move the policy forward. So we have to be patient and wait.”
Shaktikanta Das says, “About 50% of a family’s income is spent on food. Future data will decide how much the inflation rate will go. We believe that the inflation rate will come down and it will come down to around 4%. The average CPI inflation rate for this year is 4.5%. We still have to keep a lot of uncertainties in mind.”
Price stability has to be ensured in the economy
RBI Governor said, “We have to ensure price stability in the Indian economy. Price stability gives confidence to the consumer. At the same time, maintaining inflation rate will also increase the confidence of investors. As a regulator, we must maintain financial stability. This is also very important.”
Repository for digital loan offering apps
RBI Governor said, “Cyber attack is a big threat, which is increasing with the development of technology. In the banking system, we have worked on spreading awareness about cyber attack among customers. We are also creating a public repository for digital loan providing apps.” Shaktikanta Das says, “We are regularly in touch with banks and NBFCs regarding cyber security. We are constantly working with them to improve the quality of cyber security.”
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Emphasis on the use of artificial intelligence
Shaktikanta Das has emphasized on the increased use of Artificial Intelligence (AI) in the banking system in the coming days. In an exclusive interview with NDTV Editor-in-Chief Sanjay Pugalia, Shaktikanta Das said, “AI and such modern methods are being used to further strengthen supervision. Problems in the banking sector are also being analyzed through many analytical tools. This is a continuous process. We need to re-evaluate it.”
Good coordination with fintech players
RBI Governor Shaktikanta Das also expressed his views on the rules (Fintech Regulation) made regarding innovations in the Fintech i.e. financial technology industry. He said, “Good Fintech players understand the RBI regulator’s point of view very well. We have good relations with Fintech players and associations. RBI’s Fintech department holds regular meetings with them in groups or individually. Last year we announced a Fintech SRO. It will work as an interface between RBI and Fintech players.”
The governance standard of the banking system has improved than before
Shaktikanta Das said, “In the banking sector, RBI has tried to improve governance related aspects like risk management, compliance culture in the last 5-6 years. The overall governance standard in the country’s banking system has improved a lot in the last few years.”
Our action is a corrective measure
On being asked about the corrective measures in the banking system, Shaktikanta Das says, “RBI’s action against some institutions is not a punishment, but it is a corrective measure. We also do on-site and off-site monitoring of the institutions we regulate, when we receive a complaint. Supervision has been developed and it is also used. When we find any deficiency, we first alert the institutions. Then we ask for a clear roadmap from them. We expect that we give the institutions time to resolve the issues. Even after this, if they are unable to do anything, then we have to take action in the interest of consumers.”
Control over structural liquidity is necessary
In response to a question related to structural liquidity, Shaktikanta Das said, “India’s youth are aspirational. There is nothing wrong in this. This is a natural process. In fact, this is a sign of positive development. Our advice to banks is that they should keep a close eye on this change. At present, this is not a problem. But in the coming days, this thing can become a structural liquidity problem.”
Shaktikanta Das says, “Banks will have to work actively to deal with liquidity management. There should be a balance between credit and deposit growth. Banks are raising funds through infrastructure bonds at attractive rates.
Such bonds do not have reserve requirements. They are being used to finance infrastructure schemes, which is a positive step. Of course, the process of loan disbursement has become much easier due to mobile banking, but we have to understand that deposit mobilization is still a physical activity.”
Agenda issued for RBI
Shaktikanta Das said, “We have released an agenda for RBI in 100 years. The purpose of this agenda is to keep RBI ready for the future. Everything here is a team work. For this, I want to congratulate the entire team of RBI. Along with this, those regulators also deserve congratulations, who are continuously trying well.”
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