Even as the debt fund crisis continues to make investors jittery, the government may not intervene unless there is a systemic risk, said Chief Economic Advisor (CEA). The recent turmoil in the debt market has been caused by the 'irrational exuberance' of the mutual funds and NBFCs, said Krishnmurthy Subramanian, adding non-banking entities must properly evaluate the lending quality. Even though mutual funds and NBFCs can\u2019t act like banks, they were pushed towards lending as banks failed to do their duty, he also told ET Now in an interview. The asset-liability mismatch in the financial sector must be closely supervised, he noted. Furthermore, there is a need to improve the disclosure framework for defaults, as embattled non-banking financial companies (NBFCs) face a liquidity squeeze and rating downgrades, he add Also read: India struggles to develop tiny municipal bond market; China has the opposite problem There is also a need to share timely information on defaults as lack of it puts ratings agencies on a weak footing, he said. The market only gets to know about the impending crisis when the borrower defaults, he added. Even though mandating disclosure of even a single-day default may be too harsh, a system could be put in place wherein information on defaults gets shared if a repayment is missed for seven days. The exposure of mutual fund industry alone to stressed firms including Anil Ambani group companies financial arms, Infrastructure Leasing & Financial Services (IL&FS), Essel Group, Dewan Housing (DHFL) group stands at over Rs 20,000 crore. In a recent note, Credit Suisse had said that in the coming three months, more than Rs 1.3 lakh crore of borrowing of mutual funds extended to NBFCs are scheduled to mature.