BFSI SUMMIT 2024 Live:
The 3rd edition of FE Modern BFSI Summit ended successfully where we watched industry leaders, RBI Governor Shaktikanta Das, Ajay Piramal, Chairman, Piramal Group and captains of Indian BFSI sector sharing their views on the transformation of the BSFI sector as we see it today.
BFSI Summit 2024 Live Updates
Sanjay Bhutani says, “Datacenter is very efficient. It is the premise for all the innovation and is like the director of the movie.”
Sanjay Bhutani, Joint President and Chief Business Officer, AdaniConneX, talks about how UPI is a gamechanger in India.
Ajay Parimal mentions, “For affordable housing, we have made significant investments today. We are one of the fastest globally in disbursing NBFC loans.”
Ajay Piramal expects budget to continue on the road of fiscal discipline that the country has been thus far.
At the FE Modern BFSI Summit 2024, RBI Governor Shaktikanta Das discussed the difficulties banks face in bridging the credit-deposit gap by depending on alternative sources, which heightens sensitivity to interest rate fluctuations. He emphasized the importance of monitoring changes in deposit performance and maintaining rigorous credit underwriting standards despite strong credit growth.
“Our country has a very weak bond market. India‘s corporate bond market is much smaller than that of other countries with the corporate debt market being 16% of GDP,” Ajay Parimal says on the issue of weak bond market.
Ajay Parimal says, “This is the time when NBFC’s need more sources of funding. Their funding still comes from banks. We need to widen the scope of availability of funds for NBFCs,” talking about the scope of NBFCs.
“Our economy is getting a K shaped recovery, where some sectors are doing exceedingly well and others don’t. This needs to change,” says Ajay Parimal.
Ajay Piramal talks about interest rates and mentions, “Indian interest rates have declined to 9%. This has been because of lot of policy reforms. India‘s real interest rates are the highest among the largest economies. We are paying a higher cost for interest as compared to the rest of the world.”
Ajay Piramal says, “One of the things that we are hoping is to get a rating upgrade for the country. We hope to get a rating similar to China.”
The next speaker to take the stage is Ajay Piramal, Chairman of the Piramal Group.
Governor reiterates inflation concerns, watchful of WPI levels… food inflation is still biggest worry
– India Central Bank Chief Das stated that the neutral rate cannot determine policy in practical terms.
– He emphasized that the primary target is inflation, not the neutral rate of interest.
– Das noted that real interest rates are not high.
– He stressed the need for a clear focus on inflation.
– Das expressed optimism about achieving 7.2% growth.
– He pointed out that growth has been very robust even with the current level of interest rates.
Using a cricket analogy while describing the approach for tackling the challenges in Indian Financial Sector, RBI Governor said that it will have to be a mix of “Captain Cool Dhoni in T20 and Rahul Dravid’s approach in test cricket.”
RBI Governor Shaktikanta Das says “Stable inflation at 4% to be biggest contributor to GDP. Need to watch out for vegetable price rise”
Speaking on consumption levels he said, “Urban Consumption revived well post Covid… rural Consumption picked up in last few months… pace of monsoon and agricultural sowing encouraging. FMCG sales in rural areas outpaced urban levels. “
RBI rules out on not allowing large business houses in banking at the moment. Governor says no thinking in this direction
India needs sound, healthy banks well governed banks which will be able to meet credit requirement through technological innovations.
RBI Governor on Transition Financing
Climate Changes poses a challenge to economic growth. RBI has taken steps to address risks posed by changing climatic conditions. Draft on tackling challenges climate related risks in the works.
Taking steps to provide climate financing risks but need to watch out for Green-washing
RBI Governor on Private Credit Market
Important to remember that banks and NBFCs have a regulated capital, asset quality and profitability to ensure sustained financial growth and economic progress.
RBI Governor on Unsecured related credit
The rise in share of retail portfolio is a potential risk- RBI has taken steps to cut out risk in this sector. Delinquency levels and limits of small unsecured loans a point of worry.
Excessive interest rates in Micro Finance loans another matter of worry.
Overall system is healthy but there are outliers.
Watch Live at : BSFI Summit 2024 Live
There are a number of banking functions that are outsourced to third parties. These third parties need to have strong oversight on them, as a lot of these functions can be system critical for banks.
RBI Governor on key risks in the system
Cybersecurity and IT related risk
Due emphasis is placed on managing cybersecurity and IT risk. The RBI’s supervisory assessment continue to focus on making infrastructure resilient and mitigate third party risks. Banks need to continuously invest in tech to achieve greater resilience.
Digital Frauds
Rise in digital frauds via mule bank accounts very worrying. RBI monitoring transactions in various accounts. Need to be watchful about transactions in odd hours and sudden volume in hitherto inactive account. Fluctuations and increased activity in accounts that were earlier saw low volume transaction is important to monitor. Banks need to increase monitoring these
Dr Das alluded to a quote of Walter Bagehot – ‘Adventure is the life of Commerce, Caution is the life of Banking’ to bring to focus the challenges of Banking systems in the country.
He said-
Key issues in the Banking System
-Management of liquidity and credit risk
-Deposit mobilisation lagging credit growth
-Share of bank deposits declining with more households turning to other avenues of savings
-Banks need to continuously focus on credit underwriting
-Interest rate is inherent to the risk of banking
RBI Governor says, “Indian Financial Sector poised for new highs. Financial landscape undergoing structural shift. RBI actively fostering innovations like UPI, reoriented payment systems to amplify reach and make a more inclusive financial sector in India.”
Alluding to the rainy morning Dr Das started his address saying “there is lot of moisture in the air, expect swings” referring to the tough questions likely ahead during the Exclusive chat with him soon after the address
RBI Governor Shaktikanta Das to start his address at the Modern BFSI Summit 2024 soon. Stay tuned.
You can watch it live on Financialexpress.com.
The summit will be graced by the presence of the Reserve Bank of India governor Shaktikanta Das, Chairman of the Insurance Regulatory and Development Authority of India (IRDAI), Debashish Panda, Ajay Piramal, Chairman, Piramal Group, Dilip Asbe, the Chief Executive Officer of the National Payments Corporation of India (NPCI), chairmen of the biggest banks, and also the MD & CEO, Bombay Stock Exchange (BSE), Sundararaman Ramamurthy.
The inaugural address of BFSI Summit 2024 will be by Reserve Bank of India governor Shaktikanta Das. His speech will be live-streamed on Financial Express.com. Stay tuned for all the highlights
Hello everyone, welcome to the Live Blog of financialexpress.com presents Modern BFSI Summit 2024. A rainy morning in Mumbai presents you with the most comprehensive coverage of the event, featuring real-time updates, expert insights, and exclusive commentary from industry leaders. Stay tuned as we bring you the latest from this significant gathering of financial sector luminaries.
You can watch the event live on Youtube as well.