Reserve Bank of India deputy governor Swaminathan J has urged banks to strengthen their understanding of outsourced technology systems instead of depending solely on assurances from service providers. He made these remarks during a banking event held on November 28.
He said that as more banking operations shift to cloud platforms and external technology partners, the risks of disruption increase. Earlier, a technical failure could impact a single branch. Today, a similar issue can affect millions of customers at once. He added that banks must understand the technology they adopt, the controls in place and the concentration risk that arises when many institutions rely on the same provider.
According to him, the real measure of resilience is not whether incidents occur but “how quickly and effectively the institution can detect, contain and recover from it.”
His comments come at a time when banks across the world have faced major technical outages. In January 2025, a leading UK bank experienced a large scale breakdown in its mobile app and online services that affected more than twenty million users. In India, customers of a major public sector bank faced interruptions in mobile banking and fund transfers in April 2025. Digital payments networks have also come under stress. Earlier this year, a system wide glitch disrupted the fast payments system for five hours, affecting inter bank transfers and merchant payments.
These episodes show that in an era when customers rarely visit physical branches, a digital outage can completely block access to money and essential services.
Swaminathan also addressed the issue of cyber frauds. He noted that while banks have invested in systems to flag suspicious activity, technology alone cannot solve the problem. “Sharing of fraud typologies, coordinated efforts to take down mule accounts, and working with law enforcement agencies are all important,” he said.
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