RBI Warns Banks: Non-Bank Lenders & Tech Risks Intensify Competition

• RBI report highlights increasing competition for Indian banks from non-bank lenders in commercial sector funding.
• Rapid technological changes and digitalisation pose new risks like cyber threats, altering banking transactions.
• Banks need to strengthen risk assessment, improve operational efficiency, and ensure robust corporate governance.
• SCBs' consolidated balance sheet growth and credit/investment growth moderated in 2024-25.
• Deposit growth also slowed, particularly for term deposits, with PSBs showing higher transmission of rate changes.

Why It Matters: Indian banks face growing competition and tech risks, requiring stronger governance despite good asset quality.