BFSI Summit: Brainstorming by top minds of financial world to start today

Three-day event to explore India's potential and pathways to achieve it

India’s biggest banking, financial services, and insurance (BFSI) event, the “Business Standard BFSI Insight Summit 2024”, will start on Wednesday with industry leaders from banking, insurance, and equity markets gathering to discuss the country’s economic prospects.

 

The items of discussion will be geopolitical tensions threatening to derail the growth trajectory; the easing of monetary policy by the Federal Reserve putting pressure on the Reserve Bank of India (RBI) to avoid falling behind the curve; rising stress in the unsecured retail portfolio causing concern for domestic banks; and persistent under-penetration of insurance in the country, forcing the Insurance Regulatory and Development Authority (Irdai) to think out of the box to increase penetration.

 

 

The three-day summit starts with C S Setty, the newly appointed chairman of State Bank of India (SBI) inaugurating the event. He took over as SBI chairman from Dinesh Kumar Khara in late August this year. He is a career banker who started as a probationary officer in SBI in 1988 and has spent over three decades in the bank across many verticals. Earlier Setty was managing director in charge of international banking, global markets, and technology portfolios.

 

Following the inauguration, Reserve Bank of India (RBI) Governor Shaktikanta Das will sit for a fireside chat. Das, ranked the top central banker for a second consecutive year, has about a month to go before his second three-year term ends.

 

Das has faced unique challenges as the head of India’s central bank. In spite of geopolitical tensions, India’s growth remains robust, and is supported by domestic engines. However, some high-frequency indicators showed a slackening of momentum in the second quarter of 2024-25. But the RBI has stuck to its projections on gross domestic product (GDP) growth at 7.2 per cent in FY25, with the second quarter (Q2) at 7 per cent, Q3 at 7.4 per cent, and Q4 at 7.4 per cent.

 

While the inflation rate has been coming down, leading the RBI’s Monetary Policy Committee (MPC) to adopt a “neutral” stance, it rose above the RBI’s comfort level in September because an adverse statistical base effect was compounded by resurgence in food prices, and is anticipated to remain high in October as well. While the markets had expected a rate cut in December, recent comments from Das suggesting that a cut at this stage would be “premature” and “risky” have led to speculation that rate reduction may be postponed until February.

 

Das’ comments will be watched by market participants to gauge which side the RBI is tilting towards as far as rate cuts are concerned. Additionally, banks and non-banking financial companies (NBFCs) will be monitoring Das’s observations on specific issues, particularly stress in the unsecured portfolios of banks, such as credit cards and microfinance.

 

Das has been governor since December and 2018 and has managed India’s financial system amid headwinds, including the IL&FS collapse leading to a crisis in the NBFC sector, the pandemic, Ukraine-Russia war, and tensions in West Asia.

 

Das described his time at the RBI as “challenging”, but noted the institution’s success in maintaining macroeconomic resilience and financial stability. He highlighted the RBI’s most significant achievement over the past six years had been preserving the stability of the financial system.

 

T Rabi Sankar, deputy governor, RBI, too will sit for a fireside chat, which will be of interest to fintechs because the space is transforming and regulatory clarity will be of the essence.

 

Separately, the three-day event will see two report launches: One by Knight Frank and other by the Everest group.

 

Debasish Panda, who has been leading Irdai since 2022, has implemented significant changes in the insurance sector, and they are yielding results.

 

Since he assumed charge, six players entered the industry within two years, marking the first additions to the life segment in over a decade and the first in the general and health insurance segments in nearly five years.

 

Panda has brought about a crucial reform in life insurance despite resistance. He has increased charges for customers who surrender their policies in the first year of taking them. Recognising India’s low insurance penetration, Panda has given the call “Insurance for All by 2047”.

 

Further, Panda floated the idea of Bima Trinity -- Bima Sugam as a marketplace, Bima Vaahak as a women-centric agency force in the hinterland, and Bima Vistaar, a combination product of personal insurance, life insurance, and property insurance.

 

At a time when equity penetration in India is deepening and systematic investment plans have become the go-to investment option for the salaried Indian, the Securities and Exchange Board of India (Sebi) has played the role of the wise man by bringing in measures to curb irrational exuberance in derivatives trading or initial public offerings by small and medium enterprises for lack of adequate quality paper in absorbing the demand. Ananth Narayan Gopalakrishnan, whole-time member, Sebi, is likely to speak on issues plaguing equity markets.

 

The summit will end with a fireside chat with K V Kamath, the veteran banker.