The Reserve Bank of India (RBI) at its board meeting proposed to create an IT subsidiary to beef up cyber security in the Indian banking sector.
Addressing a press conference after a meeting, RBI governor Raghuram Rajan said: "The changes are so rapid, one of the directors said that today we have banking which uses information technology, tomorrow it’s going to be an information technology company which does banking. So we have to keep tabs on that.
"We have to worry about cyber supervision and with that in mind the Board suggested that we should focus on perhaps thinking about an IT subsidiary which would help us develop policy as well as capabilities in the area of information technology.
"The setup of an IT subsidiary will help up on issues such as the cyber security and evaluate the technical capabilities of banks."
Though the precise structure of the subsidiary is yet to be formulated, 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.
To bring in more improvements, the central bank is also mulling to make some minor legislative changes such as relaxing certain rules in derivatives trading.