Weathering COVID-19: Impact on Banking in India
The impact on the key stakeholders, and the way forward for the financial institutions.
COVID-19 has emerged as the black swan event of the century, with significant macroeconomic impact both globally and in India.
The exponential spread of COVID-19 has led to a significant fall in major indices, indicating its impact and potential to significantly affect GDP growth. While the overall impact of COVID-19 on credit growth is expected to be negative across most sectors, the degree and nature of the impact is likely to vary based on the duration and extent of disruption.
Impact on banking:
Opens in new window
While the government and RBI have already swung into action with targeted interventions, prolonged disruption could result in further initiatives facilitating structural changes in the industry.
Way forward:
Financial institutions are beginning to respond to some of the immediate imperatives to facilitate business continuity. However, a focused approach that involves a combination of tactical initiatives to address immediate concerns, strategic interventions to recalibrate business models and drive growth would be critical for driving profitable growth in the long run.
In this two part series we explore potential interventions for banks and NBFCS to respond, recover and thrive. This report focuses on near-term initiatives needed to effectively respond to the crisis. Stay tuned for the next part where we focus on the strategic interventions required across potential scenarios.
Note: This is the first in a two-part thoughtware. Click here to access part two.
