CHENNAI: The Reserve Bank of India Governor Shaktikanta Das said that the economic growth for the current fiscal 2023-24 (FY24) is likely to touch 8%.
In an interview to a TV channel on Wednesday, the governor said the current RBI growth estimates put GDP growth at 7.6%, but robust momentum of economic activity and high frequency growth indicators point that there is quite a good chance that GDP growth to be very close to 8%, he said.
“(Based on data points), I would not hesitate to say that there is every possibility that 7.6 % growth for the current year has been exceeded.”
Implicit growth for the fourth quarter of FY24 is projected at 5.9% and our sense and understanding of growth momentum is that Q4 growth will be more than that, he said.
The central bank governor said the economic growth projections for the upcoming 2024-25 fiscal is estimated to be 7% by the RBI and he would stick to that, though international agencies have lower projections.
Shaktikanta Das said the bank’s actions are determined to maintain financial stability and protecting customers’ and protecting depositors’ interest and the actions are necessary in public interest when the risk builds up. He clarified that the RBI’s actions are against regulated entities such as banks and non-banking financial corporations, Paytm Payments bank in this case, which are using fintechs and not against fintech companies themselves.
“There is a narrative that has been built up as if RBI is taking measures against fintech. They’re not regulated by RBI unless they’re NBFC lenders. We’re supporting fintech companies. We have set up an innovation department, regulatory sandbox, going towards forming a self regulatory organisation for fintechs.”
Fintech companies provide a third party service and RBI fixes the responsibility on NBFCs, banks using fintechs. In RBI, the endeavour is to ensure there are no major accidents, Das said.
“Accidents can still happen. But our endeavour is to ensure there are no major accidents. We have now deepened our supervision to the extent that we can now anticipate problems and risk buildup,” he added.
Das assured that as many as 80-85%of Paytm wallet users will not face any disruption because of regulatory actions, and the remaining users have been advised to link their apps to other banks. The central bank’s Paytm crackdown has caused shockwaves across the fintech sector.
Systemic risk
The RBI’s actions are against regulated entities using fintech and not against fintech firms
The RBI’s actions are necessary in public interest when the risk builds up
RBI endeavour is to ensure there are no major accidents
80-85% of Paytm wallet users will not face any disruption because of regulatory actions