RBI Governor meets CEOs of Public Sector Banks, discusses plan of action, challenges in sector

MUMBAI: The Governor of the Reserve Bank of India (RBI), Shaktikanta Das held a meeting with the CEOs of the public sector banks and the Chief Executive of Indian Banks Association (IBA) on Friday.

During the meeting, the RBI Governor acknowledged discernible improvements in the banking sector while underscoring that several challenges still remain to be addressed, particularly with regard to the stressed asset resolution and credit flows to needy sectors.

During the meeting, the several issues were discussed, which included less than desired level of transmission of monetary policy rates; credit and deposit growth on the back of a slowing economy; flow of credit to needy sectors while following prudent lending, robust risk assessment and monitoring standards; Improving recovery efforts; giving impetus to resolution of stressed assets facilitated by revised framework for resolution announced by the RBI on June 7, 2019; strengthening internal control mechanism for improved fraud risk management; recent initiatives to address issues relating to NBFCs and the role banks can play in mitigating lingering concerns; deepening digital payments.

The Governor also underlined the importance of expanding and deepening digital payments ecosystem in line with the recommendations of the Report of the Nandan Nilekani committee

It was agreed that banks will identify one district in each state to make it 100% digitally-enabled within a time frame of one year.

All stakeholders, including SLBCs, State Governments, Regional offices of RBI etc, to the extent feasible, such districts may be converged with the ‘Transformation of Aspirational Districts’ programme of the Government of India.

IBA is also expected to play a catalytic role in this regard.