“So far as BFSI is concerned, I don’t think there is much cause of concern, maybe slowdown in business and in new loan applications,” Parekh told reporters on the sidelines of CII BFSI Summit 2026 here.
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He noted that while the broader financial system remains strong and well-capitalised, the current global environment may weigh on fresh loan demand and overall business momentum. The impact is likely to be more pronounced in sectors such as oil, aviation, hospitality and logistics, rather than BFSI.
Parekh also highlighted the growing relevance of (REITs) in India, describing them as an emerging avenue that bridges the gap between developers seeking to monetise assets and occupiers preferring rental models.
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With global capability centres, IT firms and large corporates increasingly opting to lease office spaces, REITs are gaining traction by offering investors stable returns along with capital appreciation, he said, adding that the segment is expected to expand further.
On insurance, Parekh pointed out that India’s penetration remains low at around 3 per cent compared to the global average of about 8 per cent.
Growth in the segment has slowed following the withdrawal of tax benefits on premiums, but he emphasised that insurance remains a critical savings and protection tool for households. He stressed the need for greater awareness and financial literacy to drive adoption.
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Commenting on banking trends, he said deposit mobilisation has moderated as retail investors increasingly channel savings into systematic investment plans (SIPs) of mutual funds. These steady domestic inflows have helped offset foreign portfolio investment outflows, strengthening the resilience of the domestic financial system and reducing dependence on overseas capital.
On the role of technology, Parekh said the impact of artificial intelligence on the financial sector is still evolving and remains uncertain. While AI is expected to enhance productivity, its implications for employment and operations are yet to fully unfold, he added.
He further observed rising interest from both foreign investors and large Indian conglomerates in the financial services space, signalling strong growth potential for the sector.
Parekh also said recent electoral outcomes reflect a desire for change among voters, but do not pose any adverse economic implications, adding that new governments often bring renewed policy momentum.
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