Page 53 - Banking Finance February 2026

ARTICLE

Comparison with Previous Survey (Nov 2024)

Aspect Nov 2024 Survey May 2025 Survey
Overall Sentiment Concerns over inflation and global Optimism improved, risks seen as moderate
slowdown
Macroeconomic Moderately positive, with inflationary Confidence strengthened
Stability worries
Cyber & External High concern Still significant, but the system better prepared
Risks
Institutional Concerns over select NBFCs and Banks are seen as well-capitalised and resilient
Resilience governance issues

The May 2025 SRS highlights a noticeable shift in sentiment affirmation of confidence in India's institutional and finan-
from caution to confidence. While risks from cyber threats cial resilience. It highlights the impact of RBI's proactive su-
and global spillovers persist, stakeholders increasingly trust pervision and timely reforms, the strength of the banking
India's macro fundamentals, banking resilience, and regu- sector with sound capital buffers and low NPAs, and the
latory preparedness, marking a stronger outlook compared credibility of India's macroeconomic stability, marked by
to November 2024. controlled inflation and a manageable current account
deficit. At the same time, this optimism is not a call for
RBI's Response to Perceived Risks complacency; rather, it reflects resilience while recognising
Insights from the Systemic Risk Survey serve as an impor- the importance of continued vigilance against external
tant input for the RBI in designing regulatory and supervi- shocks and emerging technology-driven risks.
sory actions. In line with the risks highlighted by stakehold-
ers, the central bank has taken several forward-looking ini- Conclusion
tiatives. These include refining the Liquidity Coverage Ra- The Systemic Risk Survey (May 2025) serves as a crucial ba-
tio (LCR) framework to better capture the behaviour of rometer of financial stability. It captures how market partici-
mobile and digital deposits and issuing a Discussion Paper pants perceive risks, balancing optimism about India's resilience
on Climate Risk and Sustainable Finance to guide institutions with caution over external spillovers and cyber challenges.
in addressing ESG-linked vulnerabilities.
The highlight of the survey is the 91.9% confidence rating,
The RBI has also strengthened cybersecurity standards and showing that stakeholders overwhelmingly believe in the
carried out industry-wide resilience exercises. On the exter- stability of the financial system. At the same time, the iden-
nal front, it has facilitated Rupee-based trade settlements tification of global spillovers, capital flow volatility, cyber
to mitigate currency volatility risks. Additionally, stress tests threats, and asset price correction as top risks ensures that
of Scheduled Commercial Banks (SCBs) reaffirm that the sys- policymakers remain alert to vulnerabilities.
tem remains resilient even under severe stress scenarios.
In sum, the SRS reinforces that India's financial system is
stable, well-capitalised, and resilient, but also reminds
Interpreting the 91.9% Confidence stakeholders that systemic stability is a moving target, re-
The finding that 91.9% of respondents expect the financial quiring constant vigilance, regulatory foresight, and coor-
system to remain stable or become more stable is a strong dinated policy measures. T

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46 | 2026 | FEBRUARY | BANKING FINANCE