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India’s central bank considers setting up IT subsidiary

The Reserve Bank of India (RBI) is considering setting up an IT subsidiary that will be responsible for strengthening cyber security in the Indian banking sector.

While the precise nature of the subsidiary is yet to be formulated, RBI governor Raghuram Rajan said that the entity would be used to attract people from the IT sector and will focus on issues affecting the sector such as cyber security.

It will also be responsible for overlooking the nature of technical capabilities of banks.

The governor said that the technology being used by cyber criminals was evolving and the sector needed to be prepared to face any attack.

The Moneycontrol quoted Rajan as saying: ""We have to constantly examine our readiness in the face of new innovations in the field of cyber crime. We have thus far been relatively immune to any major cyber attacks on our banks but we can’t take that for granted.

"We have seen hacking attacks on banks in the West and we shouldn’t consider those incidents as being unique only to those areas."

The RBI is also considering implementing some minor financial legislative changes in the finaincial sector to bring in more improvements.

RBI deputy governor R Gandhi also informed that the central bank was in talk with the government to bring out new currency notes with improved security features.