RBI concerned about IT systems in small UCBs
The Reserve Bank of India is concerned about IT system architecture in 356 small urban cooperative banks and the failure of as many as 171 UCBs to fully implement core banking solution. Deputy governor N.S. Vishwanathan said he is particularly worried about smaller UCBs - 124 such banks with deposit size of less than Rs 100 million and another 232 banks with deposit size of between Rs 100 million crore and Rs 250 million. He said the argument that adoption and implementation of IT increases the cost of operations is not acceptable because IT enabled operations are a necessity to be relevant in the market place and at the same time, one needs to do what it takes to ensure safety of depositors. He also said digital banking comes with risks associated with cyber security concerns and banks need to have robust IT systems and subject them to regular IS audits.