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Shaktikanta Das says ability to combine traditional functions with innovation critical for financial sector

March 24, 2022 05:20 PM

Shaktikanta Das says ability to combine traditional functions with innovation critical for financial sector
The RBI Governor Shaktikanta Das was speaking at the inauguration of the Reserve Bank Innovation Hub. The hub has been set up at Bengaluru

The RBI Governor Shaktikanta Das was speaking at the inauguration of the Reserve Bank Innovation Hub. The hub has been set up at Bengaluru, Karnataka.

The ability to combine traditional functions with innovation has been critical to ensuring orderly growth of the financial sector, said Reserve Bank of India (RBI) Governor Shaktikanta Das on March 24.

“The recent phenomenon of technological innovations transforming the experience of availing financial services, be it banking, non-banking, payment services or being part of the financial markets has raised greater expectations from RBI to act as an innovation enabler as well,” Das said.

The Governor was speaking at the inauguration of the Reserve Bank Innovation Hub. The hub has been set up at Bengaluru, Karnataka.

Central Banks are often viewed as traditional institutions that set monetary policies, issue currencies, and regulate and supervise the financial sector segments and entities, Das said.

Read More: NBFC to implement core financial services solution by Sep 2025 : RBI

“However, or every economy to grow steadily and efficiently, this characteristic of a central bank is very important. Being a full-service central bank, the RBI also plays a developmental role and is looked upon as a residual regulator as well,” Das said.

The central bank set up the RBI innovation hub as a wholly-owned subsidiary of the RBI to promote and facilitate an environment that accelerates innovation across the financial sector.

According to Das, this initiative puts RBI in an exclusive group of select global central banks that are enterprising enough to change the mode of engagement while dealing with innovation.

The hub is expected to build an ecosystem for the development of prototypes, patents, and proofs of concept and promote cross-thinking spanning regulatory domains and national boundaries, Das said.

The RBI innovation hub has an independent Board comprising eminent members from industry and academia. The hub plans to identify and mentor start-ups having maximum potential, Das said.

That apart, the hub will collaborate with various Government ministries, departments, academia to identify problem statements in different domains and explore potential solutions.

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