Indian Banking Sector Faces Crisis as Deposit Growth Lags and TRAI Directive Takes Effect September 1

The Indian banking sector is facing challenges as deposit growth lags behind credit growth, raising concerns about the implications for the banking system. Saurabh Tripathi from the Boston Consulting Group has indicated that the industry might be confronting an existential crisis. Additionally, a directive from the Telecom Regulatory Authority of India (TRAI) set to take effect on September 1 could further complicate matters by potentially blocking messages from banks and e-commerce platforms due to new whitelisting requirements. This directive may also affect the delivery of one-time passwords (OTPs) essential for banking transactions, leading to questions about its impact on financial institutions.