Reserve Bank of India Governor Sanjay Malhotra has emphasized the crucial importance of central bank autonomy during a period of significant turbulence affecting the US Federal Reserve. In an exclusive conversation with NDTV Profit, Malhotra provided a measured defense of central banking independence amid ongoing tensions between the White House and the Federal Reserve.

Central Bank Independence Under Spotlight

The RBI Governor's comments come against the backdrop of unprecedented challenges facing the US Federal Reserve, particularly a criminal investigation launched against Chair Jerome Powell. The probe focuses on alleged irregularities in renovation costs at the Fed's headquarters in Washington, marking the first time a sitting Federal Reserve Chair has faced the threat of criminal indictment.

"Central bank independence, of course, you know, is very important. We have, over the years, moved globally — we have moved towards that for some reason because it's important to separate that from government," Malhotra stated during the interview.

Global Implications and Collective Responsibility

Without directly addressing the specific charges against Powell, Malhotra emphasized the need for a collective commitment to preserving central banking autonomy across jurisdictions. His remarks underscore the broader principle that monetary policy decisions should remain insulated from political interference.

"That is something that we need to all collectively across jurisdictions preserve, and hopefully... that should only improve over the years," the Governor explained.

Market Impact and Unprecedented Situation

The investigation into Powell has sent shockwaves through global financial markets, highlighting the interconnected nature of central banking systems worldwide. The situation represents an extraordinary development in central banking history, with potential implications extending beyond US borders.

Malhotra's emphasis on preserving central bank independence reflects India's commitment to maintaining institutional autonomy in monetary policy formulation, even as global central banking faces unprecedented challenges.

Source: https://www.ndtvprofit.com/exclusive/economy-reserve-bank-of-india-rbi-governor-sanjay-malhotra-central-bank-independence-us-federal-reserve-autonomy-jerome-powell-probe-donald-trump

Reserve Bank of India Governor Sanjay Malhotra has declared consumer satisfaction as the ultimate benchmark for measuring the central bank's success, signaling a fundamental shift in the institution's approach to financial regulation. Speaking in an exclusive interview with NDTV Profit, Malhotra emphasized that ordinary Indians are the final beneficiaries of the financial system, making their satisfaction paramount to regulatory effectiveness.

Strategic Campaign Initiatives

The RBI has implemented a series of targeted campaigns addressing persistent customer issues across the banking sector. The central bank launched a comprehensive financial inclusion and re-KYC campaign from July to October, designed to ensure customer accounts remain compliant and accessible.

Following the re-KYC initiative, the RBI coordinated with other regulators, banks, and government agencies to help citizens identify and claim unclaimed deposits. This collaborative approach addresses historical awareness gaps that have left substantial sums untouched in the banking system.

Streamlined Processes for Sensitive Situations

Recognizing the procedural challenges faced by families during difficult times, the RBI has prioritized reforms to reduce customer stress. The central bank has standardized and simplified the process for legal heirs to claim deposits of deceased account holders, addressing what Malhotra described as significant issues in accessing these funds.

"There are a lot of issues sometimes for claiming the monies and deposits of the deceased," Malhotra explained, noting that banks are now implementing the revised framework to eliminate delays and inconsistencies across institutions.

Digital Transformation and Accountability

The RBI has undertaken a comprehensive revamp of its citizens' charter to enhance transparency and operational efficiency. The central bank streamlined its service offerings by removing four unnecessary approvals from the original 204 services, bringing the total to approximately 200 services.

All services have been digitized through a centralized portal for regulated entities seeking approvals, licenses, registrations, or clarifications. The system operates under close monitoring, with performance data published monthly to ensure accountability.

Focus on Grievance Resolution

The central bank has intensified efforts to address customer complaints through its banking ombudsman system. Malhotra highlighted that clearing complaint backlogs is essential for restoring confidence in institutional redress mechanisms, making grievance resolution a priority area for immediate attention.

Long-term Commitment to Consumer-Centric Banking

These comprehensive measures represent a broader recalibration of the RBI's role toward becoming a more visibly consumer-facing institution. Malhotra emphasized that this transformation is not a temporary initiative but represents a fundamental shift in the central bank's operational philosophy.

The Governor made clear that consumer service and satisfaction will remain core priorities for the RBI in the years ahead, establishing a new paradigm where regulatory success is measured by citizen satisfaction rather than traditional institutional metrics.

Source: https://www.ndtvprofit.com/economy-finance/consumer-satisfaction-is-ultimate-test-of-rbis-success-says-governor-sanjay-malhotra