What is RBI compliance for banks and NBFCs?

RBI compliance refers to adherence to the Reserve Bank of India's regulations, including cybersecurity frameworks, data localization requirements, KYC/AML norms, and information security standards for banks, NBFCs, and payment service providers.

What are RBI cybersecurity framework requirements?

The RBI cybersecurity framework includes implementation of information security policies, regular security audits, VAPT testing, incident response plans, data protection measures, and compliance with Master Directions on Cyber Security Framework.

Why is VAPT mandatory for banks and NBFCs?

VAPT (Vulnerability Assessment and Penetration Testing) is mandatory under RBI guidelines to identify security vulnerabilities, assess cyber risks, and ensure robust protection of customer data and financial systems.

What is KYC/AML compliance under RBI regulations?

KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance involves customer identity verification, risk assessment, transaction monitoring, and reporting suspicious activities as per RBI's Master Direction on KYC.

How often should RBI compliance audits be conducted?

RBI recommends annual information security audits for banks and NBFCs, with VAPT assessments conducted at least twice a year or after significant system changes.

RBI Compliance ServicesStrengthening Security &Regulatory Trust

Comprehensive compliance solutions for banks, NBFCs, and fintechs

Cybersecurity

Risk Management

KYC/AML

Regulatory Reporting

RBI Compliance plays a role in the operation integrity, cyber security, financial transparency, and regulatory accountability in a fast-changing financial environment of India. In a bid to protect the interests of the customers and ensure the stability of financial system, the Reserve Bank of India (RBI) regulates the operations of banks, NBFCs, payment service providers, FinTech platforms, and financial institutions. Compliance with RBI guidelines is no longer a choice, as it is obligatory and a strategic requirement of any business that works in this field, as it fosters trust, minimizes risks, and provides the long-term sustainability of business operations.

At KavachOne, we assist organizations to implement, monitor, and maintain compliance of RBI on companies, banks, and RBI compliance on NBFCs so that it precisely and confidently meets all the requirements.

Why RBI Compliance Matters

RBI compliance frameworks are established, such that it develops a safe, transparent and robust financial infrastructure in India. These standards address a variety of essential aspects, including cybersecurity, IT governance, risk management, operational processes, reporting requirements and data protection of customers.

Failure to comply may lead to dire ramifications, such as fines, limitations on operation, suspension of a license, loss of reputation, and the customers. Total compliance also enables organizations to act responsibly, reduce threats and ensure a smooth customer services.

1. Information Protection & Security

As cyber-attacks, digital fraud, and data breaches continue to increase, the RBI has mandated stringent cybersecurity and IT governance requirements. Financial service providers, banks, and NBFCs must implement comprehensive cybersecurity measures to safeguard sensitive customer information and financial transactions.

Key Cybersecurity Requirements

Deployment of robust Information Security Management System (ISMS)

Periodic Vulnerability Assessment and Penetration Testing (VAPT)

Secure configuration and patch management

Network security surveillance and endpoint protection

Disaster recovery systems and incident response

Protection of sensitive financial information

Adherence to RBI's Cyber Security Framework

KavachOne assists organizations in strengthening their cybersecurity posture and aligning controls with RBI's IT governance policies, helping avoid regulatory scrutiny and reputational damage.

ISMS Deployment

Network Security

VAPT Testing

Disaster Recovery

Compliance Excellence

Cybersecurity is a cornerstone of RBI compliance. Inadequate controls can result in regulatory oversight and reputational damage.

100%

Compliant

24/7

Monitoring

Risk Mitigation

Proactive threat detection and incident response protocols minimize exposure to cyber threats and ensure business continuity.

2. Risk Management Framework

The RBI requires a complete risk management system that encompasses financial, operational risks, cybersecurity risks, and risks related to markets. The banks and NBFCs should develop systematic policies and automated schemes to identify and control any possible risks to financial stability.

Risk Management Covers prescribed by RBI include:

Credit Risk

Evaluation of credit worthiness of the borrower and recovery strategy.

Operational Risk

Making sure that there are safe internal systems and fraud prevention.

Market Risk

Dealing with market fluctuations

Liquidity risk

This is to ensure that there is sufficient liquidity when needed (stress).

IT & Cyber risk

How to address technology and data threats.

To ensure continuous compliance, organizations are required to do periodic stress testing, ensure that they have detailed risk registers and adopt risk mitigation measures. KavachOne assists the institutions in developing a strong risk management system in line with RBI recommendations, through our governance, risk, and compliance (GRC) experience.

3. KYC & AML Regulations

The KYC (Know Your Customer) and AML (Anti-Money Laundering) policies play a significant part in preventing identity fraud, money laundering, financial crime, and terrorist funding. The RBI prescribes stringent customer thorough checking and monitoring the transactions of all money giving institutions.

KYC/AML Compliance Includes:

Customer Due Diligence (CDD)

Digital identity verification and video KYC

Due diligence of black lists

Suspicious Transaction Reporting (STR)

The continuous monitoring of the transactions

Increased due diligence in high risk customers

Periodic KYC updates

These regulations help preserve the financial ecosystem and prevent the misuse of finances and guarantee the legitimacy and integrity of operations in organizations.

4. Monitoring of Compliance and Regulatory Reporting.

The banks, NBFCs and financial institutions are required to provide periodic reports to the RBI in order to maintain transparency, accountability and regulatory compliance.

Mandatory Reports Include:

Capital adequacy reports

Provisioning and asset classification

Loan portfolio dataCyber incident and operational risk reports

IT and cyber security compliance reports

Liquidity and exposure information

Audit report and financial statements

It is essential to report correctly in order to be credible and not to face punishment. KavachOne helps companies create, revise and present correct regulatory reports according to the reporting formats used by RBI.

5. RBI Compliance for NBFCs

NBFCs are of great importance to financial inclusion and lending and hence the RBI also imposes tight compliance structures that specifically target the NBFCs. Examples of RBI compliance of NBFCs are the provisions on net owned funds, fair lending practices, recovery measures, cybersecurity measures, outsourcing management, and grievance redressal measures.

We help NBFCs comply with:

Cyber Security Framework of NBFCs of RBI

Fair Practices Code (FPC)

IT governance requirements

Support of statutory reporting and audit

Development of risk and compliance framework

Compliance of customer grievance redressal

6. RBI Compliance: Companies and FinTechs

FinTech companies and payment service providers now more than ever face pressure to become more compliant with the emergence of digital payments and the use of technology to drive finance. We assist organizations to implement RBI-compliant procedures concerning:

Payment card security

Digital lending guidelines

IT and cybersecurity Outsourcing

Data protection and privacy

Fraud auditing and control

Cloud risk management and third-party risk management

regulated organizations or up-and-coming FinTechs, our experts will help to design end-to-end compliance ecosystems that are in line with the expectations of RBI.

Why Choose KavachOne for RBI Compliance?

We provide not merely the regulatory compliance at KavachOne, we act as your strategic partner. Our approach is built on:

True Partnership

To present custom-made compliance solutions, we spend intensive hours to learn about your business model, problems, and objectives.

Tangible Results

All the engagements are result-oriented and produce an improvement in terms of security, governance and compliance.

Agile Delivery

The agile approach of our methodology provides a quicker solution but still keeps a close eye on the RBI requirements.

Specialist Expertise

You work with accredited cybersecurity, risk, and compliance professionals ardent about the safety of financial systems.

Flexible Delivery Models

Our services are configured to your business onsite, remote, hybrid, and managed service.

Complete Transparency

We have an open channel of communication, schedules, and frequent updates in the process of compliance.

Ready to Strengthen Your RBI Compliance?

Partner with KavachOne for comprehensive compliance solutions tailored to your organization's needs.