for additional funding for some residual investment or for working capital needs. a major impediment observed in jlf functioning is slow evolution of consensus among the consortium members and hence, the resultant action plan gets delayed invariably. the delay somehow defeats the very purpose for which the jlf mechanism is set up. there are some views about setting up an investment fund which might come in as a last mile lender. the investment fund could lend to the truncated enterprise and help it get back to profitability at which level banks could profitably dilute their equity holdings in the firm. question is who would fund this investment fund? my sense is it would have to be joint endeavor of multiple players in this arena. moreover, extending financial support would bis central bankers ’ speeches not be sufficient. such fund would also need to have capability to provide management bandwidth to the concerned projects. conclusion 15. let me conclude by saying that the global economy has been passing through a difficult phase and vulnerabilities remain. against this backdrop and that in a globally integrated economy, a general decline in the asset quality was not totally unexpected. however, the extent being witnessed could have been avoided. it is probably because neither the banks nor the corporates resorted to preventive healthcare. i am sure that everyone would emerge much wiser after enduring the pain and be circumspect in the approach and get a periodic checkup done so that they can stay healthy and live longer. 16. for the enterprises under temporary duress, we must stretch every sinew to ensure that a productive enterprise does not become terminally ill. there are suppliers - sometimes in the form of small ancillary units or msmes and then, there are workers and their families. each enterprise supports many lives. there is an entire ecosystem around a factory or company. closure of any running unit would impact the lives of scores of people and hence, i feel it ’ s a collective societal responsibility that productive enterprises don ’ t run aground. i thank edelweiss management for inviting me to this credit conclave today and wish the deliberations all success. thank you! bis central bankers ’ speeches

do not happen by side stepping the importance of robust risk management practices. i also would like to highlight here that the nbfcs operate in a dynamic and challenging environment, facing a multitude of risks that can impact their stability and operational resilience. let me highlight just three of these which i believe deserve heightened attention. cybersecurity and operational risks 1 / 5 bis - central bankers'speeches in today's digital age, cybersecurity threats represent a significant operational risk. the stark reality is that a cybercriminal needs to succeed only once, while organisations must always remain vigilant and resilient. one of the primary cybersecurity risks faced by nbfcs is the threat of data breaches and unauthorized access to sensitive information. there are also other forms of cyberattacks, including malware infections, phishing scams, and ransomware attacks. these attacks can disrupt operations, compromise systems and data integrity, and lead to financial extortion or loss of critical information. to mitigate cybersecurity risks, nbfcs must adopt a proactive and comprehensive approach to cybersecurity. this includes implementing robust cybersecurity policies and procedures, conducting regular risk assessments and vulnerability scans. deploying advanced security technology tools such as firewalls, encryption, and intrusion detection systems are non - negotiable. further, providing cybersecurity training and awareness programs for employees, on an ongoing basis, should become a way of life. risk management and internal audit functions have to urgently build on their skill sets so that they are able to assess periodically, the it and cyber security stance and preparedness of their entities. credit risks from rule - based credit models many nbfcs are increasingly turning to rule - based credit engines to accelerate the growth of their lending portfolios. while automation can enhance efficiency and scalability, nbfcs should not allow themselves to be blinded by these models. it is crucial to recognize that rule - based credit engines are only as effective as the data and criteria upon which they are built. overreliance on historical data or algorithms may lead to oversights or inaccuracies in credit assessment, particularly in dynamic or evolving market conditions. therefore, nbfcs must maintain a clear - eyed perspective on their capabilities and limitations, supplemented by continuous monitoring and validation of credit scoring models. it is incumbent upon the supervised entities to keep the rule engines and models calibrated from time to time