The global financial crisis of 2008 has exposed numerous shortcomings in the traditional safeguards for financial stability in terms of different economic policies adopted so far. A system level perspective focusing on systemic risks with suitable policies and instruments was the felt need to combat vulnerabilities at their origin before spreading. The present study has analyzed the various policy options, indicators of systemic vulnerabilities, choice of tools and instruments for the regulatory and supervisory bodies for a granular approach in different settings. Macroprudential policy and its tools were found to be a suitable solution, either alone or in conjunction with other economic policies.