Sanjay Malhotra, the RBI Governor, has called on public and private sector banks to fortify their defenses against the growing threat of digital frauds. At a meeting on January 27, 2025, in Mumbai, Malhotra emphasized the need for robust IT risk management and cybersecurity measures. He also highlighted the importance of greater oversight of third-party service providers.
Strengthening the Financial System
In his remarks, Malhotra acknowledged the pivotal role banks play in ensuring the resilience of India’s financial system. While highlighting global vulnerabilities that could pose risks, he urged banks to maintain financial stability, deepen financial inclusion, and improve customer service and grievance redressal mechanisms.
He also stressed the importance of enhancing digital literacy and investing in technology to better serve customers and mitigate risks. Suggestions were invited from banks on improving the ease of doing business, underlining the need for close collaboration between the RBI and financial institutions.
IT Risk Management and Cybersecurity
The meeting addressed critical issues such as IT risk management and cybersecurity. RBI Governor Sanjay Malhotra urged banks to implement proactive systems to detect and prevent digital fraud. He highlighted the necessity of stronger oversight of third-party service providers to mitigate risks stemming from their operations.
The meeting was attended by Deputy Governors M Rajeshwar Rao, T Rabi Sankar, and Swaminathan J, along with senior executives responsible for regulation and supervision. This interaction followed a similar meeting held on July 3, 2024.
Also read: Odisha Leads Fiscal Health Rankings; Punjab Lags Behind
Tackling Liquidity Challenges
Separately, with liquidity deficits in the banking system reaching multi-year highs, the RBI announced measures to address the issue. The central bank will conduct open market operations (OMOs) worth ₹60,000 crore in three tranches of ₹20,000 crore each on January 30, February 13, and February 20.
These measures aim to ease liquidity pressures while ensuring financial stability in the banking sector. This engagement underscores the RBI’s commitment to working closely with banks to address emerging challenges and safeguard the integrity of India’s financial system.
