Fresh look at regulation and supervision of NBFCs needed, says RBI chief

Das added that in the light of recent developments, there is a case for having a fresh look at their regulation and supervision.

RBi, RBI chief, shaktikanta das, NBFC, regulate NBFCs, reserve bank of india, banking in india, indian banks,

Reserve Bank of India Governor Shaktikanta Das.

The Reserve Bank of India is soon to issue new guidelines for liquidity risk management framework to harmonise the liquidity norms between banks and the non-banking financial companies (NBFC). RBI Governor Shaktikanta Das, while addressing the 15th convocation of the National Institute of Bank Management here on Saturday, talked about the need of a fresh look at the regulation and supervision of the NBFCs.

“The conventional approach to their regulation and supervision has been light-touch, so that they could complement banks with their diverse financial products for niche areas and reach a large cross-section of population through innovative service delivery mechanisms.

“However, with a view to strengthen the sector, maintain stability and avoid regulatory arbitrage, the Reserve Bank has been proactively taking necessary regulatory and supervisory steps, keeping in mind the requirements of the time,” he said.

Story continues below this ad

Das added that in the light of recent developments, there is a case for having a fresh look at their regulation and supervision.

“It is our endeavour to have an optimal level of regulation and supervision so that the NBFC sector is financially resilient and robust. At the same time, NBFCs should be enabled to operate as well-functioning entities with necessary capacity to reach wider sections of population,” he said.