“RBI Not a Policing Authority: Governor Shaktikanta Das on Regulatory Actions in Financial Markets”.

Reserve Bank Governor Shaktikanta Das addressed concerns regarding the RBI’s role in the financial markets on Friday, clarifying that the central bank does not operate as a policing authority. Instead, he emphasized the RBI’s commitment to maintaining a close watch on the financial landscape and taking necessary regulatory actions when issues arise. This statement came in light of the RBI’s recent directive to Sachin Bansal’s Navi Finserv and three other non-banking financial companies (NBFCs) to cease the sanctioning and disbursement of loans, effective October 21. The decision was driven by serious supervisory concerns, particularly regarding usurious pricing practices.

At the India Credit Forum hosted by Bloomberg, Das stated, “No…we are not law enforcement. We are observing closely. We maintain a vigilant eye on the credit markets, and when necessary, we take action.” His remarks underline the RBI’s proactive approach to safeguarding the integrity of financial institutions and protecting consumers.

Das also pointed out that this is a crucial moment for India, asserting, “India’s growth story remains strong.” He noted that inflation has fallen within the target range and is expected to moderate further. However, he acknowledged that significant risks remain in the economic environment. As such, the RBI is carefully monitoring the overall outlook concerning both growth and inflation to ensure sustained stability.

Das’s comments reflect the central bank’s balancing act of fostering economic growth while ensuring regulatory compliance and market integrity, highlighting its crucial role in India’s financial ecosystem.