RBI deputy governor Rohit Jain warns banks against aggressive lending
The RBI just told banks to slow down on aggressive lending, especially with a flood of fresh money coming in from overseas deposits.
Senior RBI Deputy Governor Rohit Jain made it clear that while all this extra cash sounds great, it could turn into trouble later if banks aren't careful about who they're giving loans to.
RBI absorbs half of ₹11T inflows
With around ₹11 trillion pouring in, the RBI has already soaked up about half through things like forex interventions.
For now, banks are stashing funds in government bonds, but that's only temporary.
The RBI is also nudging banks to wrap up any pending cross-border trades and explore ways to simplify procedures for foreign portfolio investors and popularize facilities for retail customers in accessing foreign exchange and government securities, basically making sure things stay smooth and safe as new payment rules kick in from October 1.