As stated in the report of the Reserve Bank of India, the financial condition of the country remains strong. This has been said in the Financial Stability Report released by RBI. According to the report, despite the Middle East crisis and external shocks, the financial condition of the country is strong.

According to the latest report of the Reserve Bank, India's banking system is currently in a very strong and safe condition. Banks have adequate money and capital, while their bad loans (NPAs) are also continuously decreasing. This is the reason that even if the economy faces a major shock, banks will still be able to deal with it. The report also says that non-banking financial companies (NBFCs) are also in good condition. Their earnings are increasing and their bad debts have also seen improvement.

Cyber ​​attack is the biggest threat

However, the Reserve Bank has pointed towards a big danger. According to him, in the coming time, cyber attacks with the help of Artificial Intelligence (AI) can become the biggest challenge for the financial sector. RBI Governor Sanjay Malhotra said that the world is currently going through two major changes. First, increasing geopolitical tensions and war-like situations, and second, rapidly increasing use of AI technology.

Economy strong despite disruptions

He said that despite the war and supply chain disruptions, the global economy has remained strong so far. At the same time, India has also shown its strength despite external challenges on the basis of strong economic growth, low inflation and better financial condition of companies. However, RBI believes that in view of the increasing tensions and uncertainties around the world, there is a need to remain alert and continuously strengthen the financial security system. According to the report, Scheduled Commercial Banks (SCBs) are in a completely safe and sound position due to strong capital, adequate reserves of cash, continuous improvement in asset quality and stable profits. The report says that the results of the macro stress test show that the banking system is in a strong position to absorb potential shocks. The overall capital ratio is expected to remain well above the regulatory norms even for other adverse conditions.