RBI discusses a host of issues with small finance banks

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The Reserve Bank on Friday discussed with the heads of the small finance banks (SFBs) the stress build-up due to the Covid-19 pandemic and other related issues.

The discussion, according to an RBI release, focused on a range of issues including evolution of the business models of SFBs; enhancing board oversight and professionalism; further improvements in assurance functions, compliance; internal control and risk management; and need to build up their IT infrastructure both for enhanced customer experience and for cyber security resilience.

“…the stress build-up due to Covid-19 and the mitigation measures for continued resilience of books of SFBs also formed part of the discussion,” it said.

Challenges and the way forward were also deliberated upon to enable the SFBs to play their role in the Indian financial intermediation space and contribute to financial inclusion, the RBI said.