NITI Aayog co-hosted a conference on “The Future of Indian Banking” on February 22, 2019, with the Foundation for Economic Growth and Welfare (EGROW Foundation). Dr. Rajiv Kumar, Vice Chairman, NITI Aayog, inaugurated the event. The conference aimed to increase and elevate the discourse on the banking sector in India, and help develop insights to inform the continued evolution of the Indian banking sector for optimally supporting the growing credit needs of the Indian economy. Dr. Rajiv Kumar highlighted the tremendous progress made by the banking system in the past four years that provided a strong foundation for a long runway for expanding credit and supporting accelerating growth of India’s economy. He indicated that there was still a lot of work to be done in improving the financial system and furthering reforms in the financial sector.
The other key messages from the deliberations included:
Technology has become critically important for banking already and will continue to become more important in future. This will serve to bring banking closer to the customer, including those in rural areas, and also bring tremendous efficiencies with greater speed of service at much lower cost.
Appropriate skilling of banking human resources is necessary to keep pace with best credit practices and new technology-based banking paradigm. In addition, banking staff needs to be trained to prepare for a larger role of banking in expanding the Indian economy.
The banking industry has to be continuously prepared for fraud and rising cyber security risks.
The banking industry requires a suitable vigilance mechanism for trustworthy banking but with a clear mandate to distinguish between deliberate action, criminal negligence, error in judgment or unforeseeable business risk.
There may be a need to think again in terms of specialised and sector based banking.
Public sector banks have consistently supported social banking, unlike private and foreign banks. Public sector banks should continue to do so.
To compete effectively globally there is a need for bigger banks in India.
There is a need for more research on banking sector issues, specific to the Indian context.
The event hosted over 200 domestic and international participants, including policy makers, academicians, researchers, professionals, and students from various banks, universities and institutes.The eminent speakers included Dr. Rajiv Kumar, VC NITI Aayog, Shri Rajiv Kumar, Secretary, Department of Financial Services, Ministry of Finance, Dr. K.V. Subramanian, CEA, Government of India, Dr. Andreas Bauer, Senior Resident Representative, IMF, Dr. Marius Vismantas, Lead Financial Sector Specialist, World Bank, Shri Sunil Mehta, MD, Punjab National Bank, Shri NandkumarSaravade, CEO, Reserve Bank Information Technology Pvt Ltd (ReBIT), and Dr. Arvind Virmani, Chairman, EGROW Foundation.