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This will possibly expose the entities in the financial system and its users to increased amount of risk

The article from The Hindu Business Line discusses remarks made by RBI Deputy Governor M. Rajeshwar Rao at the 18th FIBAC 2024, where he emphasized the need for India's financial institutions to significantly increase in scale and size to meet the demands of a rapidly growing economy. Rao highlighted that while Indian banks have shown resilience and growth, they still lag behind global counterparts in terms of size, which limits their ability to fund large-scale infrastructure projects or compete internationally. He stressed the importance of banks not only growing in size but also in capabilities, suggesting that consolidation might be necessary to achieve the required scale. Additionally, Rao pointed out the need for banks to adapt to technological advancements, manage risks effectively, and maintain robust governance structures to support India's economic aspirations. He also touched upon the evolving regulatory landscape and the necessity for banks to prepare for future challenges including climate change and cybersecurity.

Read the Full Business Line Article at [ https://www.thehindubusinessline.com/money-and-banking/india-needs-to-take-a-quantum-leap-in-scale-and-size-of-its-financial-institutions-says-rbi-dy-guv-rao/article68918294.ece ]