RBI Annual Report FY 2025-26 explains financial stability, stress testing, banking resilience, cyber risks, UCBs, NBFCs, frauds, supervision and deposit insurance.

The RBI Annual Report FY 2025-26 presents financial stability as a combination of macroprudential surveillance, strong regulation, forward-looking stress testing, cyber resilience, effective supervision, responsible innovation, enforcement and depositor protection. The Reserve Bank’s approach during the year was not limited to checking whether individual banks were sound; it increasingly focused on identifying vulnerabilities that could spread across institutions, markets and financial infrastructure. This makes the chapter highly relevant for the RBI Grade B Promotion Exam, RBI Grade B, UPSC, banking examinations and interviews.

1. What Does Financial Stability Mean in the RBI Framework?

Financial stability is broader than simply having profitable banks.

A financially stable system should be capable of:

absorbing shocks;
maintaining critical financial services;
meeting liquidity obligations;
protecting depositors and consumers;
containing contagion;
managing emerging technological and cyber risks; and
supporting sustainable economic activity.

The RBI’s Annual Report describes the domestic financial system as having remained stable and robust during 2025-26. At the same time, the Reserve Bank continued strengthening regulation and supervision while adapting to technological and emerging risks.

This gives us the central theme of Part 15:

Resilience is not a single ratio. It is the combined ability of the financial system to withstand credit, liquidity, operational, cyber, climate and contagion risks.

2. Financial Stability Department — The Macroprudential Layer

The Financial Stability Department (FSD) is responsible for monitoring risks to macrofinancial stability and assessing the resilience of the financial system through macroprudential surveillance.

It also acts as the secretariat to the Sub-Committee of the Financial Stability and Development Council (FSDC-SC).

The FSDC-SC is an inter-regulatory institutional forum dealing with:

financial stability;
financial-sector development; and
inter-regulatory coordination.

The FSD also publishes the Financial Stability Report (FSR) twice a year. The FSR presents the collective assessment of key macrofinancial risks by the FSDC-SC.

Exam Formula

FSD → Macroprudential surveillance → FSDC-SC secretariat → Financial Stability Report

3. What Was the FSD Trying to Strengthen?

For 2025-26, the FSD’s key agenda had two major components.

First: Better stress testing

The RBI planned to:

develop an in-house liquidity stress-testing framework for NBFCs;
explore extending macro stress testing to Tier 3 and Tier 4 Urban Cooperative Banks (UCBs);
assess climate transition risks affecting carbon-intensive sectors and banks exposed to them.

Second: Growth-at-Risk

The FSD also planned to develop a Growth-at-Risk model.

The purpose was to understand how:

financial conditions + financial vulnerabilities → probability of future weak economic growth

This is important because it represents a shift from simply asking:

“Are banks safe today?”

to asking:

“Could current financial vulnerabilities generate weaker growth tomorrow?”

4. What Did the FSD Achieve?

The Annual Report states that the NBFC liquidity stress-test framework had reached an advanced stage of development.

The RBI also explored the feasibility of developing a macro stress-testing framework for Tier 3 and Tier 4 UCBs, aligned with the framework used for scheduled commercial banks.

On climate risk, the Department assessed the risks facing major carbon-intensive sectors using Scope 1 emissions data of listed companies.

Hypothetical stress scenarios were then used to examine:

Climate transition risk → firm financial performance → spillover to banks

The FSD also developed a model based on the IMF’s Growth-at-Risk framework to estimate the impact of financial vulnerabilities on India’s GDP growth.

5. Why Stress Testing Matters

Stress testing asks a simple but powerful question:

What happens to a financial institution if an extreme but plausible shock occurs?

For example, a bank could face:

deposit withdrawals;
funding concentration;
deterioration in asset quality;
market shocks;
operational disruptions;
cyber incidents; or
combinations of these.

The purpose is not to predict that a crisis will occur.

It is to identify weak points before the crisis occurs.

That is why stress testing is an important pillar of financial stability.

6. Climate Risk Becomes a Financial Stability Issue

One of the important developments in the report is the integration of climate transition risk into financial stability analysis.

The RBI assessed major carbon-intensive sectors using Scope 1 emissions data and hypothetical stress scenarios.

The logic is:

Climate policy/transition → impact on carbon-intensive firms → deterioration in financial performance → impact on banks’ exposures → possible financial-system spillovers

This is a classic example of how a non-traditional risk can become a financial risk.

Exam Point

Do not treat climate risk merely as an environmental issue.

For a financial regulator, it can become:

credit risk + market risk + liquidity risk + systemic risk.

7. Commercial Banks: Liquidity Resilience Gets a Major Upgrade

One of the most important supervisory developments of FY 2025-26 was the enhancement of the liquidity stress-testing framework for banks.

The earlier framework was based on reverse liquidity stress testing.

It was enhanced into a forward-looking model.

The new model estimates:

survival horizon, or
days to failure

based on analysis of a bank’s:

cash inflows; and
cash outflows.

8. How the New Liquidity Stress Test Works

The framework uses common scenarios with varying:

run-off rates; and
asset haircuts

for individual banks.

The objective is to assess whether banks can continue meeting short-term obligations during stressed conditions.

The model also maps banks’ survival horizons against:

the extent of insured deposits; and
funding concentration.

Banks exhibiting:

high funding concentration;
low insured deposits; and
short survival horizons

would receive greater supervisory attention.

The model is implemented semi-annually and presented to the Board for Financial Supervision (BFS).

9. Why the 2023 Global Banking Turmoil Matters

The RBI explicitly incorporated lessons from the March-May 2023 global banking turmoil.

The Annual Report notes that banks with:

high uninsured deposits; and
high funding concentration

can be particularly vulnerable during periods of liquidity stress.

This explains why RBI’s framework increasingly looks beyond capital adequacy and asks:

How quickly can a bank run out of usable liquidity under stress?

That is a much more forward-looking supervisory question.

10. Supervision of Financial Intermediaries

The Department of Supervision (DoS) supervises a broad range of financial entities, including:

Scheduled Commercial Banks, excluding RRBs;
Local Area Banks;
Payments Banks;
Small Finance Banks;
Credit Information Companies;
All India Financial Institutions;
Urban Cooperative Banks;
NBFCs, excluding HFCs;
Asset Reconstruction Companies.

Since 2019, supervision of banks, UCBs and NBFCs has been brought under the umbrella of a unified Department of Supervision.

This allows the RBI to take a more holistic view of financial-sector risks.

11. Digital Banking: Operational Resilience

Modern financial stability is impossible without digital resilience.

Digital channels have become critical infrastructure for banks.

Therefore, the RBI planned a Service Availability and Resilience Framework for digital banking channels.

The framework is intended to specify resilience-related parameters for digital services offered by regulated entities.

During 2025-26, work on the framework was underway and it was proposed to be issued for public consultation before finalisation.

12. Real-Time Monitoring of Digital Banking Services

The RBI also worked towards an online dashboard capable of monitoring the availability of selected digital banking services in near real time.

A pilot was being evaluated through the Indian Banks’ Association (IBA) involving 10 banks.

This reflects an important transformation in supervision:

Traditional supervision

Periodic data → supervisory assessment

Emerging supervision

Real-time operational data → early warning → intervention

This is the direction of SupTech-enabled supervision.

13. Digital Forensic Readiness

The RBI also worked on baseline requirements for Digital Forensic Readiness.

The objective is to ensure that when a cyber incident or digital misconduct occurs, the institution is capable of:

preserving relevant digital evidence;
investigating the incident; and
supporting appropriate supervisory or enforcement action.

The baseline requirements were at an advanced stage of finalisation during the year.

14. Cyber Risk Has Become a Systemic Risk

The Annual Report makes it clear that cybersecurity is no longer merely an IT-department concern.

The RBI undertook cyber-mapping exercises covering:

commercial banks;
ICT service providers;
security tools;
AI applications;
account aggregators; and
threat-intelligence platforms.

The objective was to understand cyber-risk exposure and interdependencies across the financial system.

Why is interdependency important?

Because:

Bank A’s technology failure → common service provider → Bank B/C/D affected → system-wide disruption

Therefore, the regulator has to monitor network-level risk, not merely institution-level cyber controls.

15. Cyber Range Initiative

The Reserve Bank operationalised the Cyber Range initiative through a platform deployed at the Institute for Development and Research in Banking Technology (IDRBT).

The platform allows supervised entities to conduct cyber-drill exercises using simulated scenarios.

These scenarios include incidents observed or reported across supervised entities.

The objective is to improve:

preparedness;
response capabilities; and
resilience against emerging cyber threats.

Exam Point

Cyber Range → simulated cyber incidents → preparedness + response + resilience

16. Banking Frauds: A Critical Stability Signal

The Annual Report provides an important distinction:

The number of frauds declined, but the amount involved increased in certain major bank groups.

For 2025-26, total reported fraud cases of ₹1 lakh and above were:

10,114 cases involving ₹48,021 crore.

This compares with:

23,722 cases involving ₹32,803 crore in 2024-25.

So:

Number ↓ sharply
but
Amount involved ↑

That is an important exam observation.

17. Bank Group-Wise Fraud Data

Bank Group	Fraud Cases 2025-26	Amount Involved
Public Sector Banks	5,418	₹35,709 crore
Private Sector Banks	3,956	₹11,399 crore
Foreign Banks	210	₹290 crore
Financial Institutions	13	₹498 crore
Small Finance Banks	467	₹114 crore
Payments Banks	47	₹11 crore
Local Area Banks	3	negligible
Total	10,114	₹48,021 crore

Public sector banks accounted for the largest share of the amount involved, at ₹35,709 crore.

18. Where Were the Frauds Concentrated?

The answer changed significantly over time.

In 2023-24 and 2024-25, card/internet/digital payments accounted for the largest number of fraud cases.

But in 2025-26, the advances category accounted for the largest number of cases and overwhelmingly dominated the amount involved.

2025-26 Area-wise Data

Area	Number of Frauds	Amount Involved
Advances	8,640	₹40,774 crore
Others	418	₹6,063 crore
Deposits	407	₹377 crore
Inter-Branch Accounts	57	₹72 crore
Off-balance Sheet	8	₹521 crore
Forex Transactions	23	₹125 crore
Card/Internet/Digital Payments	293	₹29 crore
Cash	181	₹35 crore
Cheques/DDs etc.	84	₹14 crore
Clearing Accounts	3	₹11 crore
Total	10,114	₹48,021 crore

Major Exam Insight

Fraud numbers are not the same thing as fraud losses.

The amount involved is not necessarily equal to the ultimate loss because:

recoveries may occur; and
the entire amount involved may not necessarily have been diverted.

The Annual Report also cautions that frauds reported during a year may have occurred in earlier years.

19. Cyber-Enabled Fraud and Money Mules

The RBI recognised the growing threat from cyber-enabled frauds and money mule accounts.

Its response involved five broad layers.

1. Regulatory measures

Strengthening:

KYC Directions;
Fraud Risk Management framework;
Payment Aggregator regulation; and
Digital Payments Security Controls.

2. Supervisory measures

The RBI intensified:

KYC and AML/CFT inspections;
thematic assessments;
risk identification;
monitoring; and
corrective-action engagement.

3. Technology and innovation

Banks were encouraged to use:

AI/ML;
MuleHunter.ai;
the bank.in domain;
HaRBInger; and
the Regulatory Sandbox.

4. Customer awareness

Nationwide campaigns addressed:

cyber-enabled fraud;
digital arrest;
the 1930 helpline; and
risks associated with renting bank accounts.

5. Multi-stakeholder coordination

The RBI worked with bodies including:

Indian Cyber Crime Coordination Centre (I4C);
Ministry of Home Affairs;
Ministry of Finance;
Department of Telecommunications;
FIU-IND;
TRAI;
law-enforcement agencies; and
regulated entities.

20. MuleHunter.ai: Technology Against Financial Crime

MuleHunter.ai uses behavioural and transactional features derived from real-world fraud patterns to assign a confidence score to bank accounts indicating the probability that an account is a mule account.

As of March 31, 2026:

implemented in 26 banks;
implementation underway in 4 more banks.

The eventual action on a suspected mule account remains the responsibility of the individual bank, based on its internal assessment and enhanced due diligence.

This is a good example of the transition from:

rule-based fraud detection → data-driven and AI-assisted risk detection.

21. UCBs: Moving Towards Risk-Based Supervision

Urban Cooperative Banks were another important focus.

The RBI completed a comprehensive review of the Risk-Based Approach (RBA) for KYC/AML supervision of selected UCBs.

The revised framework covered UCBs accounting for around 60% of total deposits of the sector.

The new approach focuses more strongly on:

inherent KYC risks;
money-laundering risks;
terrorism-financing risks; and
emerging sector-wide risks.

The RBI also initiated development of a Risk-Based Supervisory Framework for UCBs.

22. NBFCs: Stronger Risk-Based Supervision

The RBI also recalibrated its supervisory framework for NBFCs.

The revised KYC/AML supervisory framework:

increased coverage;
recalibrated off-site risk assessment; and
accounted for the heterogeneous nature of NBFC business models.

The RBI also examined the pricing practices of supervised entities, focusing on:

interest rates;
processing fees; and
accuracy of Annual Percentage Rate (APR) disclosures in Key Fact Statements.

Non-compliance and discrepancies identified during examinations were documented and followed up through continuous supervisory assessment.

23. A Crucial Structural Change: Risk-Based Supervision

The movement towards risk-based supervision is one of the most important themes of the chapter.

The idea is not:

“Every institution gets exactly the same supervisory intensity.”

Instead:

Higher risk → deeper supervisory attention

This allows the regulator to deploy supervisory resources more efficiently.

During 2025-26, RBI was developing risk-based supervisory frameworks for:

UCBs; and
selected NBFCs.

24. Supervisory Data Quality Index — sDQI

Data quality itself is a financial stability issue.

The RBI initiated quarterly publication of Supervisory Data Quality Index (sDQI) scores from June 2025.

The index measures data quality across four dimensions:

Accuracy
Completeness
Timeliness
Consistency

Scores for the quarters ending March, June, September and December 2025 were published during the year. Individual scores were also shared with the respective supervised entities.

Exam Memory

sDQI = Accuracy + Completeness + Timeliness + Consistency

25. Why Data Quality Matters for Financial Stability

A regulator cannot identify risks correctly if supervisory data are:

incomplete;
inaccurate;
delayed; or
inconsistent.

Therefore:

Better data → better risk identification → better supervision → greater financial stability.

This is why RBI’s supervisory architecture increasingly combines:

SupTech + data analytics + risk-based supervision + early-warning systems.

26. Overseas Supervision of Indian Banks

Indian banks increasingly have international operations.

The RBI therefore devised a framework for inspection of overseas branches and subsidiaries of Indian banks.

As of end-March 2026:

15 overseas branches had been inspected during the year.

Major concerns were taken up with host supervisory authorities for timely remediation.

27. Supervisory Colleges

For selected Indian banks with cross-border operations, RBI has established supervisory colleges.

These serve as multilateral forums for coordination between:

home supervisors; and
host supervisors.

During 2025-26, RBI participated in 12 supervisory college meetings involving select large internationally active banks.

This is important because financial risks do not stop at national borders.

28. Enforcement Is a Separate Function

The Enforcement Department (EFD) was established to separate enforcement action from the supervisory process.

Its purpose is to establish a:

structured + rule-based + consistent approach

to identifying and processing violations by regulated entities.

The ultimate objective is compliance with applicable:

statutes;
RBI directions; and
regulatory conditions,

within the broader principles of:

financial stability;
public interest; and
consumer protection.

29. RBI Enforcement Action in 2025-26

During FY 2025-26, the RBI imposed:

241 penalties

aggregating to:

₹26.33 crore

for various contraventions/non-compliance.

Entity-wise distribution

Entity	Number of penalties	Penalty
Public Sector Banks	13	₹9.05 crore
Private Sector Banks	14	₹7.93 crore
Foreign Banks	3	₹1.14 crore
Payments Banks	2	₹0.61 crore
Small Finance Banks	1	₹1.00 crore
RRBs	2	₹0.41 crore
Co-operative Banks	172	₹4.12 crore
NBFCs	25	₹1.76 crore
HFCs	6	₹0.04 crore
Payment System Operators	3	₹0.27 crore
Total	241	₹26.33 crore

Another important number

342 show-cause notices involving 698 charges were issued.

Of these:

382 charges resulted in monetary penalties;
316 charges did not result in enforcement action.

30. Consumer Protection Is Part of Financial Stability

Financial stability ultimately depends on public confidence.

The RBI’s Consumer Education and Protection Department (CEPD) is responsible for:

strengthening grievance-resolution systems;
monitoring internal grievance mechanisms;
administering the Reserve Bank-Integrated Ombudsman Scheme;
consumer education; and
awareness regarding secure banking and customer protection.

Thus:

Consumer confidence → trust in financial institutions → stability of the financial system.

31. RBI-Integrated Ombudsman Scheme, 2026

Based on operational experience, stakeholder feedback and global best practices, RBI comprehensively reviewed the RB-IOS, 2021.

The revised:

RB-IOS, 2026

was issued on January 16, 2026.

In addition, Internal Ombudsman Directions were issued on January 14, 2026, separately for different categories of regulated entities, to facilitate faster and more meaningful resolution of customer grievances at the regulated-entity level.

32. Cooperative Banks and the Ombudsman Framework

A significant consumer-protection measure was the inclusion of:

central cooperative banks; and
state cooperative banks

within the ambit of the RB-IOS, 2021, effective November 1, 2025.

This expanded access to the RBI Ombudsman mechanism for customers of rural cooperative banks.

33. DICGC: The Depositor Protection Layer

The Deposit Insurance and Credit Guarantee Corporation (DICGC) is a wholly owned subsidiary of the Reserve Bank established under the DICGC Act, 1961.

Its deposit-insurance function serves two linked objectives:

Protect depositors; and
Preserve public confidence in the banking system.

Therefore, DICGC contributes directly to financial stability.

34. Number of Insured Banks

As of March 31, 2026, the DICGC had:

1,950 registered insured banks

comprising:

124 commercial banks, including:
- 11 SFBs;
- 6 Payments Banks;
- 28 RRBs; and
- 2 LABs;
1,826 cooperative banks, including:
- 1,440 UCBs;
- 34 State Cooperative Banks; and
- 352 District Central Cooperative Banks.

35. Deposit Insurance Coverage: ₹5 Lakh

The current deposit-insurance coverage limit was:

₹5 lakh per depositor per bank

for deposit accounts held:

“in the same capacity and in the same right.”

This is one of the most important banking-exam facts.

36. How Extensive Was Deposit Insurance Coverage?

As of September 30, 2025:

fully insured deposit accounts = 291.4 crore;
share of total accounts = 97.5%.

In value terms:

insured deposits = ₹1,04,09,023 crore;
share of assessable deposits = 41.1%.

The DICGC reserve ratio — deposit insurance fund to insured deposits — stood at:

2.37%

as of September 30, 2025, compared with 2.21% a year earlier.

37. DICGC Premium

During 2025-26, DICGC levied a flat premium of:

0.12% per annum

on total assessable deposits.

Deposit-insurance premium received during the year amounted to:

₹29,947 crore

representing year-on-year growth of 11.9%.

Easy Memory

DICGC premium = 0.12% = 12 paise per ₹100

38. Risk-Based Premium Framework

A major development was the introduction of a Risk Based Premium (RBP) Framework for deposit insurance under Section 15(1) of the DICGC Act, 1961.

The framework provides for differential premium rates depending on the category/risk characteristics of insured banks.

Effective April 1, 2026, it provides for a two-tier risk-based rating methodology:

Tier 1

Scheduled Commercial Banks other than RRBs.

Tier 2

RRBs;
rural cooperative banks; and
UCBs.

39. Why Risk-Based Premium Matters

The principle is straightforward:

Better-managed banks should pay lower deposit-insurance premiums.

The framework also provides a vintage discount for banks that have contributed to the DICGC Deposit Insurance Fund over a longer period without major stress events or claim payouts.

Therefore, deposit insurance moves from:

uniform pricing → risk-sensitive pricing

This creates a stronger incentive for prudent management.

40. Deposit Insurance Fund

The DICGC maintains the Deposit Insurance Fund (DIF) to settle claims involving banks that are:

liquidated;
amalgamated; or
placed under All-Inclusive Directions.

During 2025-26:

Claims settled = ₹1,988 crore

All of these claims related to 72 UCBs that were either liquidated or placed under All-Inclusive Directions.

The DIF stood at:

₹2,61,823 crore

as of March 31, 2026, representing year-on-year growth of:

14.4%

from ₹2,28,933 crore.

41. The Complete Financial Stability Architecture

The FY 2025-26 framework can be visualised as a chain:

Layer 1 — Macro surveillance

FSD → macroprudential surveillance → FSDC-SC → FSR

Layer 2 — Regulation

DoR → prudential and conduct regulation

Layer 3 — Supervision

DoS → onsite + off-site + risk-based supervision

Layer 4 — Technology

SupTech + AI/ML + cyber mapping + digital resilience

Layer 5 — Enforcement

EFD → rule-based enforcement

Layer 6 — Consumer protection

CEPD → grievance redressal + Ombudsman

Layer 7 — Depositor protection

DICGC → deposit insurance

Together:

Surveillance + Regulation + Supervision + Technology + Enforcement + Consumer Protection + Deposit Insurance = Financial Stability

42. What Were the Major Risks RBI Was Preparing For?

The Annual Report shows a broadening risk map.

Risk	RBI response
Liquidity risk	Forward-looking stress tests
Credit risk	Prudential regulation and supervision
Funding concentration	Survival-horizon analysis
Cyber risk	Cyber mapping, Cyber Range
Digital disruption	Service availability/resilience framework
Fraud/money mules	AI/ML, MuleHunter.ai
Climate transition risk	Scenario analysis
Systemic contagion	Macroprudential surveillance
Data risk	sDQI
Consumer risk	Ombudsman and grievance mechanisms
Institutional failure	DICGC deposit insurance

This is why the chapter is much broader than “banking supervision.”

43. 2026-27: Where Is RBI Heading?

The next phase of financial stability work will focus on:

FSD

improving financial-network and contagion analysis;
further climate-risk assessment.

Commercial-bank supervision

stronger CKYCR framework;
customer identification confidence-level framework;
offshore V-CIP for NRI onboarding;
credit-risk and responsible-business-conduct reviews.

Cyber supervision

cyber-risk micro-data analytics;
risk-based KYC/AML supervision;
alignment of incident reporting with FSB’s FIRE format;
expanded digital-service availability monitoring;
Digital Forensic Readiness;
AI-related cyber-risk assessments.

UCBs

supervisory data quality index for Tier 3 and Tier 4 UCBs;
Mission SAKSHAM;
cyber mapping;
migration towards risk-based supervision.

NBFCs

credit and liquidity stress testing;
cyber mapping;
risk-based supervision;
enhanced IT examinations.

44. The Most Important Conceptual Shift

If there is one idea you should carry into an RBI Grade B or Promotion Exam answer, it is this:

Earlier approach

Institution-focused supervision

Emerging approach

System-wide, forward-looking, technology-enabled risk supervision

The RBI is increasingly asking:

Where can risk emerge?
How quickly can it spread?
How interconnected are institutions?
Can liquidity withstand a shock?
Can digital infrastructure continue operating?
Can cyber risks become systemic?
Can climate transition risks spill into bank balance sheets?
Are consumers adequately protected?
Is depositor confidence protected?

That is the modern meaning of financial-system resilience.

45. High-Value Numbers for Exams

Indicator	FY 2025-26 figure
Total fraud cases	10,114
Amount involved in frauds	₹48,021 crore
Fraud amount in advances	₹40,774 crore
Overseas bank branches inspected	15
Supervisory college meetings	12
sDQI dimensions	4
Banks in MuleHunter.ai	26
Additional banks implementing MuleHunter.ai	4
Insured banks	1,950
Commercial insured banks	124
Cooperative insured banks	1,826
Deposit insurance limit	₹5 lakh
Fully insured deposit accounts	291.4 crore
Fully insured account share	97.5%
Insured deposits	₹1,04,09,023 crore
Insured deposits/assessable deposits	41.1%
DICGC reserve ratio	2.37%
DICGC premium	0.12%
Premium received	₹29,947 crore
DICGC claims settled	₹1,988 crore
UCBs covered by those claims	72
Deposit Insurance Fund	₹2,61,823 crore
DIF YoY growth	14.4%
Risk-based premium framework effective	1 April 2026
UCB RBA framework deposit coverage	~60%

46. Most Probable Exam Questions

Q1. Which department conducts macroprudential surveillance?

Answer: Financial Stability Department (FSD).

Q2. What is the role of FSDC-SC?

Answer: It is an inter-regulatory forum dealing with financial stability, financial-sector development and inter-regulatory coordination.

Q3. What is the Growth-at-Risk model used for?

Answer: To assess how financial conditions and financial vulnerabilities can affect the distribution/probability of future economic growth outcomes.

Q4. What major change was made to bank liquidity stress testing?

Answer: The framework moved from reverse liquidity stress testing towards a forward-looking model estimating survival horizon/days to failure.

Q5. What are the four dimensions of sDQI?

Answer: Accuracy, completeness, timeliness and consistency.

Q6. How many fraud cases were reported in 2025-26?

Answer: 10,114, involving ₹48,021 crore.

Q7. Which category accounted for the largest amount of fraud in 2025-26?

Answer: Advances — ₹40,774 crore.

Q8. How many banks had implemented MuleHunter.ai as of March 31, 2026?

Answer: 26 banks.

Q9. What is the current DICGC deposit-insurance limit?

Answer: ₹5 lakh per depositor per bank, subject to the same-capacity-and-same-right condition.

Q10. What was the DICGC premium rate during 2025-26?

Answer: 0.12% per annum of assessable deposits.

Q11. What is the Deposit Insurance Fund size as of March 31, 2026?

Answer: ₹2,61,823 crore.

Q12. What is the purpose of risk-based deposit-insurance premiums?

Answer: To differentiate premiums according to risk, with better-managed banks eligible for lower premiums.

Key Takeaways

India’s financial system remained stable and robust during FY 2025-26.
FSD handles macroprudential surveillance and supports FSDC-SC.
FSD publishes the Financial Stability Report (FSR) twice a year.
RBI strengthened forward-looking liquidity stress testing.
The new bank liquidity model estimates survival horizon/days to failure.
Funding concentration and uninsured deposits are important liquidity-vulnerability indicators.
Climate transition risk is being incorporated into financial stability analysis.
Cyber risk is increasingly treated as a systemic financial risk.
Cyber Range enables simulated cyber-drill exercises.
Total frauds in 2025-26 = 10,114 cases involving ₹48,021 crore.
Advances accounted for ₹40,774 crore of fraud amount.
RBI is moving UCBs and NBFCs towards risk-based supervision.
sDQI = accuracy + completeness + timeliness + consistency.
MuleHunter.ai was implemented in 26 banks by March 31, 2026.
Enforcement action resulted in 241 penalties worth ₹26.33 crore.
DICGC deposit insurance coverage remains ₹5 lakh.
DICGC insured 1,950 banks as of March 31, 2026.
DICGC premium was 0.12% during 2025-26.
Risk-based deposit-insurance premiums became effective April 1, 2026.
Deposit Insurance Fund reached ₹2,61,823 crore.

One-Minute Revision Sheet

Financial Stability

FSD → Macroprudential surveillance → FSDC-SC → FSR

Stress Testing

Banks → survival horizon/days to failure

NBFCs → liquidity stress-testing framework

UCBs → macro stress-testing exploration

Emerging Risks

Climate → transition risk

Cyber → cyber mapping + Cyber Range

Fraud → MuleHunter.ai

Data → sDQI

Fraud Numbers

10,114 cases → ₹48,021 crore

Advances → ₹40,774 crore

Enforcement

241 penalties → ₹26.33 crore

DICGC

1,950 insured banks

₹5 lakh coverage

0.12% premium

₹29,947 crore premium collected

₹1,988 crore claims settled

₹2,61,823 crore DIF

Core Philosophy

Identify risk early → measure it quantitatively → stress-test it → supervise it → intervene where necessary → protect consumers and depositors.

Part 15 complete.