Five-Member Committee Established for Banking Reforms in India
The Indian government has formed a committee to enhance the banking sector's global competitiveness and resilience by 2047.
The committee is led by former Central Vigilance Commissioner Suresh N Patel.
It will review banking practices and recommend reforms for efficiency and inclusivity.
The panel aims to prepare a roadmap for AI integration and workforce development in banking.
In a significant move towards overhauling the banking sector, the Indian government has established a five-member high-level committee tasked with reviewing the current banking system and proposing necessary reforms. This initiative aims to ensure that the banking sector is globally competitive, financially inclusive, and resilient by the year 2047, as part of the Viksit Bharat vision.
The committee will be chaired by Suresh N Patel, who previously served as the Central Vigilance Commissioner. Other notable members include Shirish Chandra Murmu, Deputy Governor of the Reserve Bank of India; Padmaja Chunduru, former MD and CEO of Indian Bank; and N S Vishwanathan, also a former Deputy Governor of RBI. The committee's member secretary will be the Joint Secretary (Banking) from the Department of Financial Services. The panel is expected to operate for six months.
Finance Minister Nirmala Sitharaman announced the formation of this committee during her Budget speech for the fiscal year 2026-27. The committee's primary objective is to assess existing banking practices and regulations, identify global best practices, and adapt them to enhance the Indian banking landscape. This includes a thorough review of the regulatory and legal frameworks governing banks, including Regional Rural Banks and Cooperative Banks, to suggest reforms that improve operational efficiency.
Additionally, the committee will evaluate the long-term capital needs of banks, Development Financial Institutions, and Non-Banking Financial Companies (NBFCs). It will provide recommendations on potential funding sources and mechanisms to support credit growth. The committee will also explore the disparities in the cost of capital for businesses and propose policy measures to stimulate private investment, aligning with sustainable growth objectives.
As technology continues to evolve, the committee will address the implications of artificial intelligence in banking. It will devise a roadmap for digital innovation while ensuring safeguards against cyber risks. Furthermore, the panel will recommend strategies for talent acquisition and capacity building to prepare the banking workforce for future challenges, ensuring that the sector remains robust and adaptive in a rapidly changing environment.
