##ted or recovers within a short period if there is any failure. 13. the sixth indicator of excellence is ‘ adaptability ’. in a fast changing world, product life cycles are becoming very short and thus adapting them for quick changes is a virtual requirement. i may at this stage indicate that while the rbi introduced the micr cheque clearing with the reader sorter based processing, it also closed it a few years ago and brought in cheque truncation. this is a good example of adaptability coupled with evolution. way forward 14. let me flag a few aspects, which apply to any payment service provider and products, and may need to be examined going forward. i. performance assessment : as i look at the landscape of retail payment systems, the question of whether we have too many products / variants could be contemplated. products that have outlived its utility could be eased out. the process of consolidation, exit route for products and players should be actively pursued. may be markets / users themselves could take care of this. it is also useful to make the systems inter - operable to harness their true potential. ii. customer grievance redressal mechanism : ( a ) the e - baat programmes and the recent media workshops that rbi has conducted reveal one striking keynote address by shri b. p. kanungo, deputy governor, reserve bank of india, at the npci national payments excellence awards function, mumbai, on may 29, 2018. inputs received from the department of payment & settlement systems are acknowledged. feature. lack of consumer awareness not just on the various payment options and features available, but even on the grievance redressal mechanisms available. this illiteracy transcends across all geographies and regions, not just rural or semi - urban, north or south and is equally true of the staff at the front desks of bank branches. are we doing enough to educate the public? should it be the responsibility of the regulator alone? the answer is no. let us all strive to build consumer awareness consciously and rigorously. an informed customer is a crucial cog in the payment ecosystem. ( b ) we get many complaints related to failure of transactions. in our country, when new users are being initiated into digital financial transactions, if their early experience is less than wholesome, they are put off, and fall back on non - digital means. it is imperative that we harness technology to ensure this. payment systems must ensure 100 %

determine capital allocation. each business unit in the enterprise would have to aim at being a profit centre within the overall risk - return framework. in essence, it would mean accountability for profit tempered by the discipline of risk – return, within a deeply embedded culture of good governance, the tone of which is set by the bank ’ s top management. from a business perspective, pricing of assets should be non - bis central bankers ’ speeches discriminatory and in line with risk rating of the customer. a lower rated customer should not get a better price than a higher rated customer. in the context of risk - return trade off, i want to flag another issue. it is common knowledge that where return is more, risk is more. however, in our anxiety to make quick bucks or what we colloquially call “ a search for yield ”, we very often tend to forget this basic tenet of finance. there can be no defense for the bank management who chose to finance the subprime borrowers in the usa. i am not sure why the boards did not question the strategy of the management while this business was growing manifold and banks were able to make huge profits by repackaging these mortgages as aaa securities through structured deals. i have a very practical suggestion for the distinguished group present here : seek a detailed analysis of the income stream. banks ought to conduct a thorough assessment of the products, services, activities or business streams that are most profitable as this is where the maximum risk must be lurking. the path and passage of risk can be truly understood only through a scrupulous income analysis. a risk management framework is incomplete without an effective system of internal controls and methodologies. as i mentioned earlier, the bank managements and, especially, the bank boards form the first line of defense for risk management. unless the bank ’ s management is geared to internalize and institutionalize a risk and control culture, any attempts to increase the resilience of banks can meet only limited success. in fact, the recent instance where a media outfit has brought out an expose on alleged irregular practices at bank branches is a clear instance of failure on the part of bank managements and boards to institutionalize an effective risk control framework and compliance culture across the organization, right up to the level of the front office staff. the management has a critical role to play in getting the right balance between the business units and risk management, both in times of stress and in good times, when there is a tendency for misaligned