Will bank account number portability be a reality in India?

As technological advancements continue to change the world of finance and banking, Reserve Bank deputy governor S S Mundra called upon bankers to "reinvent themselves" if they want to remain relevant.

"If there is a cloud-funding, if there is P2P lending today, then what is the role of banks? What they would be expected to do? Probably banks will have to reinvent themselves to maintain their relevance in the world of finance," Mundra said speaking to a select audience consisting of leading bankers at a meet organised by business daily 'Mint'.

In this context, he spoke about bank account portability and wondered if mobile numbers can be ported, why not bank accounts.

"If mobile number portability is possible, why banking account number portability is not possible?"

He went on to add that if banking account portability becomes a reality, "it would be a major disruption in the industry and every bank must be quite cautious about this. Also, it would be interesting to watch how banks would deal with this issue."

Asked whether there are some concerns about monetary policy transmission as only two small banks have cut base rates after the RBI surprisingly lowered repo rate by 25 bps early this month, Mundra said the impact comes with a lag.

If RBI cuts rates today, the banks are not expected to lower their rates immediately, he said, adding, they have their asset liability committees, and there are other approval systems.