Policy Watch
Banks Directed to Integrate Compliance Systems with RBI’s Daksh Platform

New Delhi: The Reserve Bank of India (RBI) has instructed banks to align their internal compliance monitoring systems with its advanced supervisory platform, Daksh. This move is aimed at enhancing the efficiency and effectiveness of regulatory compliance monitoring, according to sources familiar with the development.
While public sector banks are actively working towards meeting these requirements, some foreign banks operating in India have expressed concerns. They argue that their existing compliance systems are already highly advanced, and integration with Daksh would necessitate significant recalibration.
To facilitate this transition, the RBI has extended the deadline for regulated entities to upgrade their compliance frameworks to April 2025. The integration is to be implemented via straight-through processing (STP), which automates the compliance workflow.
“Banks had requested an extension for reviewing and implementing new compliance tracking systems, which the RBI has accepted. However, the regulator now expects these systems to be integrated with Daksh,” a senior bank executive explained.
Launched last year, Daksh is a sophisticated, web-based, end-to-end workflow application designed to enhance the RBI’s supervisory oversight. It aims to streamline compliance monitoring processes in supervised entities (SEs), including banks and non-banking financial companies (NBFCs), fostering a stronger compliance culture.
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In January, the RBI issued a circular, ‘Streamlining of Internal Compliance Monitoring Function – Leveraging Technology’, emphasizing the need for regulated entities to adopt enterprise-wide, integrated, workflow-based compliance solutions. The circular noted that existing compliance systems across entities varied widely, ranging from simple spreadsheets to comprehensive software tools. The initiative seeks to standardize and modernize compliance frameworks, enabling real-time data sharing and improved collaboration among stakeholders.
Banks have since collaborated to establish a standardized format for compliance monitoring, which the RBI has approved. Despite this progress, concerns remain. In a recent internal meeting of bankers, foreign lenders highlighted challenges in integrating their systems with Daksh. “We will engage with stakeholders, including technology vendors, before seeking further clarifications from the RBI,” a senior executive said.
The RBI’s push for integrating Daksh underscores its commitment to advancing regulatory oversight and promoting a robust compliance ecosystem across India’s banking sector. However, as the April 2025 deadline approaches, the balance between innovation and practical implementation will be closely monitored by the industry.