'We aspire to grow SME segment faster than wholesale banking'

The Reserve Bank of India's regulatory approach has consistently centred on ease of doing business and enhancing customer experience, says Paritosh Kashyap, whole time director and executive director at Kotak Mahindra Bank.

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He tells Mahesh Nayak in an interview that the bank's priorities continue to be SME lending, transaction banking, customer service, and retail assets. Excerpts:

How do you see 2026 shaping up for the economy, markets, and banking?

The RBI's priorities have shifted dramatically over the last seven-eight years.At that time, the entire regulatory focus was on NPAs - credit quality, stress recognition, and deep inspections. Once the NPA problem was largely addressed around 2022, the focus has shifted to governance.

Today, the RBI's emphasis is firmly on ease of doing business and customer experience. They want banks to be more customerfriendly, more responsive to complaints, and more seamless in service delivery. The consolidation of thousands of circulars into a fraction of that number is a major step.

Even if the rules themselves haven't changed drastically, the clarity and accessibility have immensely improved. These are signals of a regulator trying to align with how markets have evolved. They are moving gradually, but the direction is constructive and positive.

What does this shift mean for banks?

It means the era of lazy banking is over. Margins have shrunk, spreads are tighter, and competition is intense - not just from banks, but from fintechs and NBFCs, many of whom are extremely nimble and loaded with capital.