RBI Issues Advisory To Banks In The Wake Of Covid-19

The Reserve Bank of India on Monday issued an advisory to heads of banks and financial institutions in the country, asking them to step up processes to manage the impact of Covid-19.

The regulator asked banks to set up quick response teams and suggested that lenders take stock of ‘business continuity plans’ to ensure that banking operations are not hindered if the local spread worsens.

In an advisory, the central bank said:

• Banks should devise a strategy and monitoring mechanism to track the spread of the disease within the organisation.
• Timely interventions should be made to prevent further spread in case of detection of infected employees.
• Banks should take stock of critical processes and revisit their Business Continuity Plan (BCP) to ensure that critical services are not impacted due to absenteeism either driven by the individual cases of infections or preventive measures;
• Banks should also encourage their customers to use digital banking facilities as far as possible.

“Besides taking steps as above for ensuring business process resilience, supervised entities should also assess the impact on their balance sheet, asset quality, liquidity, etc. arising out of potential scenarios such as further spread of COVID-19 in India,” the RBI said.