Reserve Bank of India (RBI) Regulations and Financial Inclusion
RBI Governor Sanjay Malhotra emphasized avoiding regulations that create barriers to financial inclusion, advocating for a risk-based regulatory approach to reduce compliance burdens while ensuring protection against financial crimes.
Key Points from Sanjay Malhotra's Address
- Regulations should not create unintended obstacles to financial inclusion.
- A balance between the benefits and costs of regulations is crucial.
- Emphasis on customer rights and convenience while ensuring due diligence.
Approach to Financial Crimes
- Regulations must target only the illicit activities with precision.
- Overzealous measures should not stifle legitimate activities and investments.
Advancements in Digitalisation
- India's progress in digital customer onboarding processes, such as digital KYC and video KYC.
- The Central KYC Records Registry has over 1 billion records, easing customer onboarding.
- Need for improved coordination among entities to streamline the KYC process.
Commitment to G20 Road Map
- India aims to implement the next phase of the G20 road map for inclusive cross-border payments by 2027.
- Focus on making cross-border payments faster, cheaper, more transparent, and inclusive.
Achievements and Challenges
- India's progress in making digital payments accessible and affordable.
- Placed in the ‘regular follow-up’ category by FATF for its anti-money laundering framework.
- Continuous evolution and sophistication of threats from money laundering and terror financing.
Collaboration and Technological Advancements
- Need for close cooperation among government agencies, financial entities, civil society, and others.