RBI Governor Sanjay Malhotra has introduced an exclusive ‘.bank.in’ internet domain for Indian banks to enhance cybersecurity and combat financial fraud. Alongside this, stricter authentication protocols for digital transactions were announced during the unveiling of the Monetary Policy on Friday.
Exclusive ‘.bank.in’ Domain for Banks
To reduce online financial fraud, the RBI will implement the ‘bank.in’ domain exclusively for banks in India starting April 2025. This initiative will enable customers to distinguish legitimate banking websites from fraudulent ones.
Malhotra stated, “The Reserve Bank shall implement the bank.in exclusive Internet domain for Indian banks.”
Additionally, a ‘fin.in’ domain will be introduced later for the broader financial sector to extend security measures across different financial institutions.
Stronger Authentication for Digital Payments
Highlighting the rise in digital fraud, Malhotra stressed the need for joint action by all stakeholders.
“The surge in digital fraud is a matter of concern. It warrants action by all stakeholders. The Reserve Bank has been taking various measures to enhance digital security in the banking and payment system,” he said.
To further strengthen digital security, the RBI has proposed extending additional authentication factors to online international transactions made to offshore merchants. This move aims to safeguard cross-border digital payments against fraudulent activities.
“The introduction of an additional factor of authentication for digital payments is one such measure. It is now proposed to extend this to online international digital payments made to offshore merchants who are enabled for such authentication,” Malhotra added.
Enhancing Interest Rate Risk Management & Retail Bond Market Participation
To assist market participants in managing interest rate risks, the RBI is expanding its suite of interest rate derivative products. A new forward contract for government securities will be introduced, benefiting long-term investors like insurance funds.
This will enable:
- More efficient pricing of derivatives linked to government securities.
- Enhanced risk management across interest rate cycles.
Additionally, to boost retail participation in government securities, the RBI has expanded access to the NDS-OM platform, which facilitates secondary market trading of government bonds.
- Non-bank brokers registered with SEBI will now have access to the platform.
- This move aims to deepen the bond market and increase participation from non-bank financial entities.
Review of Trading and Settlement Timings
Recognizing evolving market dynamics, the RBI will establish a working group to conduct a comprehensive review of trading and settlement timings across five different RBI-regulated financial markets.
- The group will include representatives from various stakeholders.
- The final report will be submitted by April 30, 2025.
Banking System Resilience & Liquidity Conditions
- As of January 2025, the credit-deposit ratio (CDR) stood at 80.8%, remaining stable compared to September 2024.
- Liquidity buffers in banks remain adequate, with strong Return on Assets (RoA) and Return on Equity (RoE) despite moderation in net interest margins.
- The Non-Banking Financial Companies (NBFCs) sector continues to exhibit strong financial stability.
Conclusion
The RBI’s new initiatives, including the ‘.bank.in’ domain, stricter authentication for international transactions, and enhanced risk management tools, aim to strengthen India’s banking and financial ecosystem. These measures will play a crucial role in mitigating fraud, expanding market participation, and ensuring macroeconomic stability.