New Delhi, Nov. 16 -- The quinquennial report cards on India's financial sector have been issued and they present a disturbing picture. The World Bank's Financial Sector Assessment and the International Monetary Fund's (IMF) Financial System Stability Assessment were released during October and February 2025, respectively. Both reports have pointed out critical, strategic gaps in the regulatory frameworks across the financial sector's different segments, thereby raising multiple red flags.

In the aftermath of the 2008 financial crisis, both the Bank and IMF have jointly started undertaking a comprehensive study of the financial sector in select countries, especially those with systemically important financial sectors. The study is mandat...