New guard, old challenges: Will fresh leadership at India’s financial regulators spur reforms in 2025?

In 2024, India’s banking and securities regulators unleashed an unexpected wave of activity, surprising the financial sector with a slew of long overdue supervisory and regulatory interventions. Yet, critical questions linger: Will these measures deliver lasting transformation? Or in certain timelines, were they just calculated moves to divert attention from contentious narratives dominating public discourse?

One week into 2025, India’s financial sector awaits news of stronger economic activities in the quarters ahead. While there is clear evidence of progress, unresolved challenges continue to cast a long shadow over recent gains. Enhanced market transparency across the financial system and stronger banking supervision stand out as robust achievements, reinforcing India’s financial sector. On the other hand, inflationary pressures, subdued consumption demand, and stagnant private capital expenditure remain key challenges for the sector’s resilience. 

Adding to the current flux is mounting speculation about new leadership at key regulatory bodies. With a new Reserve Bank of India (RBI) Governor, Sanjay Malhotra, already in place and anticipated changes at the Securities and Exchange Board of India (SEBI) and the Insurance Regulatory and Development Authority of India (IRDAI), the expectations—and stakes—could not be higher.