Ensure digitalisation and innovations are aligned with fair outcomes for consumers: RBI Governor

Mumbai (Maharashtra) [India], January 9 : The Reserve Bank of India (RBI) Governor on Friday said our aim should be to ensure that digitalisation and innovations are aligned with fair outcomes for consumers.
While speaking at the Third Annual Global Conference of the College of Supervisors in Mumbai, Governor Malhotra said, "For all of us, protecting customers' interest is not just a priority, it has to become the cornerstone of a sustainable and resilient financial system."
He said the digital channels facilitate our efforts by improving inclusion and convenience. "But, without guardrails, they can also facilitate opaque pricing, weak disclosures and inappropriate recovery practices."
"A key element of this endeavour should be to protect customers from the menace of rising digital frauds, which has engaged national attention. While banks and other regulated entities individually should continue to improve their tools, techniques and processes in preventing and tackling digital frauds, this is an area where we need to collaborate with each other to build analytics and tools to detect mule accounts and suspicious transactions timely and pre-emptively," Governor Malhotra said.
Speaking on the usage of data, he mentioned that the RBI has undertaken several initiatives in the past to streamline the reporting mechanisms and improve the quality of data.
"We collect large amounts of data through platforms like CIMS and DAKSH. While some amount of burden is placed on all of you in this process, our supervisory capabilities have been strengthened because of your support. I am happy to note that the quality of data has improved recently, following introduction of the Supervisory Data Quality Index (SDQI) last year," he said.
"I am confident that we will continue to collaborate for improving the system while reducing the burden placed on regulated entities," the governor added.
He further mentioned that while we have made good use of this data, there is scope for more effective use of this data.
"Department of Supervision can build stronger analytics and supervisory dash boards for enhanced off-site surveillance, to support more continuous monitoring and early risk detection. Our endeavour should be to make supervision more off-site than on-site and as near real-time and not periodic. Increasingly, this will also mean using SupTech and AI-enabled tools more deeply, while retaining judgment and accountability, firmly with supervisors," he said.