RBI to put in place a “PRISM” to strengthen compliance by lenders
25th Aug, 2021
The Reserve Bank of India is putting in place a Platform for Regulated Entities for Integrated Supervision and Monitoring (PRISM) to strengthen compliance by supervised entities (SEs).
- PRISM is a web-based end-to-end workflow automation system.
- The focus of its new approach to ‘continuous supervision’ is on early identification of risks and conduct of supervisory actions.
- This is aimed at helping supervised entities to strengthen their internal defences and resilience.
- The focus of its new approach is to bring focus on ‘root cause analysis (RCA)’.
- PRISM will have various functionalities with:
- Built-in remediation workflows
- Time tracking
- Notifications and alerts
- Management information system (MIS) reports and dashboards
Entities in India regulated by RBI
- RBI regulates and supervises various entities in India.
- Entities regulated by the RBI include-
- All India Financial Institutions
- Non-Banking Financial Company (NBFC)
- All payment system providers
RBI’s annual report (2020-21) on supervisory framework
- In its latest annual report (2020-21), RBI said it has been working towards strengthening the supervisory framework for both banking and non-banking sectors.
- During the year, initiatives were taken towards:
- integration of supervisory functions meant for different supervised entities
- specialisation and reinforcement of supervision through both vertical and horizontal risk assessments
- setting up a dedicated College of Supervisors for capacity development
- harnessing SupTech (supervisory technology)