Balancing Regulations for Financial Inclusion: Governor Malhotra's Insights

Reserve Bank Governor Sanjay Malhotra emphasized the importance of avoiding unintended barriers in the pursuit of financial inclusion. Speaking at the FATF event, he highlighted India's progress and urged a balanced regulatory approach. He advocated for technology-neutral solutions to enhance financial systems against illicit activities.

Reserve Bank Governor Sanjay Malhotra stressed avoiding 'unintended barriers' in financial inclusion during his speech at the Financial Action Task Force (FATF) event on Wednesday.

Highlighting India's substantial progress with 94 percent of adults having bank accounts, Malhotra cautioned regulators against being 'overzealous' and urged measures that protect customer rights without stifling legitimate activities.

He advocated for regulations targeting only illegitimate activities with 'surgical precision' and suggested adopting risk-based approaches while ensuring technology-neutral solutions for combating money laundering and illicit financing.

(With inputs from agencies.)