New Delhi, October 14, 2024 – Reserve Bank of India (RBI) Governor Shaktikanta Das emphasized the need to reduce the costs and time associated with overseas remittances, highlighting the role of new technology in enhancing cross-border payments. In his keynote address at the conference on ‘Central Banking at Crossroads,’ Das underscored the importance of remittances for developing economies, including India.
“Remittances are the starting point for many emerging and developing economies to explore cross-border peer-to-peer (P2P) payments. There is immense potential to significantly reduce the cost and time for such remittances,” Das stated.
He further proposed the feasibility of expanding the Real-Time Gross Settlement (RTGS) system to settle transactions in major trade currencies, such as the dollar, euro, and pound, through bilateral or multilateral arrangements. Das noted that India and several other countries have already initiated efforts to enhance the connectivity of cross-border fast payment systems.
Das also discussed the potential of Central Bank Digital Currency (CBDC) to facilitate efficient cross-border payments. He stressed the importance of harmonizing standards and ensuring interoperability among CBDCs to address financial stability concerns related to cryptocurrencies.
Additionally, the RBI Governor raised concerns about the misuse of Artificial Intelligence (AI) in the banking sector, warning that it could lead to increased cyber attacks and data breaches. He urged banks and financial institutions to implement adequate risk mitigation measures, stating, “Banks must harness the advantages of AI and Big Tech without letting them take control.”
This article reflects the RBI Governor’s insights on enhancing remittance systems and the need for robust security measures in banking technology.
