FINTECH REGULATIONS
Top startup and tech stories this week
Welcome to a brand new edition of ETtech Unwrapped – our weekend newsletter packed with the most important stories that we covered this week. Here’s a recap if you missed them.
How Sebi action will impact profits of discount stock broking firms like Zerodha and Groww
Market regulator Sebi mandated in its July 1 circular uniform brokerage charges that are not based on volumes. Due to this, tech-first brokers are staring at impact on valuations. Platforms like Shoonya and Mstock charge zero brokerage fees, and they are bracing for impact from Sebi's instructions. Venture fund-backed startups like Groww, Upstox, Zerodha and listed discount broker Angel One will also have to start charging their customers.
US fintech platform TIFIN debuts in Indian market with conversational AI assistant MyFi
MyFi is a personalised product created specifically for India, taking inspiration from its successful US counterpart, Magnifi, as explained by Kiram Nambiar, cofounder and CEO of MyFi said. MyFi is compatible with Android and iOS operating systems, it is a subscription-based model with plans starting at Rs 299/month
Top fintechs dial NBFCs for secured credit partnerships
Fintech startups, having built trust as unsecured loan providers, are setting their sights on the secured credit market. Companies like PhonePe, Cred, and Paytm are seeking collaborations with non-banking financial institutions (NBFCs) to facilitate these secured loans. Lenders also want to work with fintechs for such products, as they look to source prime customers through these platforms.
Indian financial services sector is experiencing a significant upswing: Inventure Growth & Securities’ Kanji B Rita
India's financial services sector is poised for sustained growth. By leveraging the demographic advantage, embracing technological advancements, and prioritizing financial inclusion, a robust and inclusive financial ecosystem can be built, says Inventure Growth’s Kanji B Rita.
Fintech lenders have high delinquency levels in small value loans says RBI
The RBI has highlighted concerns over consumer loans, noting that over half of borrowers have three or more loans simultaneously. The Financial Stability Report flags high delinquency rates, especially among personal loans under ₹50,000 and loans from fintech lenders. Despite overall improvements in credit quality, stress in retail loans remains significant, particularly for private sector banks.
Tighter regulations are for the greater good of fintech ecosystem, not obstacles, say industry leaders
India’s fintech sector has been bearing the brunt of strict regulations by the RBI, which has also led to investors losing confidence in the startups. However, industry leaders believe these regulations will only make the ecosystem stronger.
Global Economic Summit 2024 to empower MSMEs through fintech solutions
India's fintech sector is set to host the 9th Global Economic Summit in Mumbai from August 8-10, 2024, focusing on 'FinTech: Accelerating the Digital Revolution.' The event features support from ONDC, DLAI, and Atal Incubation Centre - RMP, with notable speakers discussing evolving market trends and critical technologies.
Sebi issues show cause notice to PB Fintech Chairperson Yashish Dahiya on $2 million investment
PB Fintech is pursuing legal action regarding the SCN and maintains that there will be no material impact on the company's financials or operations. The announcement was made after market hours and the stock ended at Rs 1,288 on the NSE, down by 5.35 or 0.41%.
RBI penalties up 88% in 3 yrs; KYC, AML top list
The number of penalties imposed by the Reserve Bank of India on financial institutions grew 88% in the past three years with Know Your Customer (KYC) and Anti Money Laundering (AML) topping the list of non-compliances. The central bank collected ₹78.6 crore over the three years after imposing penalties on 261 occasions in 2023 alone, according to RBI reports compiled by Signzy, a fintech firm that manages regulatory compliance for institutions.
RBI unveils final guidelines for fintech SRO
The RBI had unveiled draft guidelines in January this year, following which industry participants sent in their responses. The regulator wants the SRO to be truly representative of multiple participants across the fintech space.
RBI Guv Shaktikanta Das launches PRAVAAH, Retail Direct mobile app and FinTech Repository
The Reserve Bank of India (RBI) has launched three major initiatives to enhance regulatory processes, facilitate retail investment, and provide comprehensive data on the fintech sector. The PRAVAAH portal is a secure web-based platform for individuals and entities seeking authorizations, licenses, or approvals from the RBI. The RBI Retail Direct mobile application simplifies transactions for retail investors, and the FinTech Repository provides data on Indian fintech firms for better regulatory understanding and policy formulation.
Betting on disruptors in India’s BFSI sector: Insights from Beams Fintech Fund, Sagar Agarvwal
The Fintech and Financial Services sector has grown exponentially in the last few years, and yet much more is to be achieved. In India, the sector contributes nearly one-third of the GDP and $1.3 trn in market cap. Additionally, disruptive products by fintech companies, aided by innovation-friendly policies have made India one of the fastest-growing financial services market in the world. As a result, there are ample opportunities for investments in this space.
Fintech regulations to help those who follow rules: QED’s Nigel Morris
Nigel Morris, cofounder and managing partner at QED Investors, spoke to ET about the recent clampdown by India's central bank across various segments of new-age financial services, the funding environment, valuation of fintechs and more in an exclusive chat.
How GoI, regulators and fintech firms can unlock the full potential of India's digital financial revolution
This surge in fintech adoption has positioned India as a global fintech frontrunner. Its innovative solutions attract global investors, and position the country as a trailblazer in establishing a robust digital public infrastructure (DPI) ecosystem, a pivotal factor in enhancing financial inclusion. The dynamic DPI framework, strengthened by fintech advancements, is projected to inject a windfall of $400 bn into the economy in seven years.
There could be trade-off between innovation and regulation: RBI DG Rajeshwar Rao
Rajeshwar Rao also pointed out that regulators must focus on achieving a delicate equilibrium that addresses the critical concerns without imposing an undue burden on regulated entities.
CCI conducting enquiries against some fintech entities: Chairperson Kaur
CCI Chairperson Ravneet Kaur disclosed ongoing investigations into fintech entities to examine their technology leveraging impact on competition, emphasizing the regulator's commitment to ensuring a competitive digital market. With an eye on big tech and various sectors, including film distribution, CCI aims to address market distortions, fostering innovation and economic growth
Norms for swappable e-bus batteries; Avanse, Subko raise funds
The government is framing rules to enhance interoperability for batteries used in electric buses. This and more in today’s ETtech Top 5.
Balancing fintech regulation with innovation tricky: World Economic Forum official
Matthew Blake navigates the delicate balance between regulation and innovation in the rapidly evolving fintech landscape, emphasizing the need for proactive measures to combat fraud and ensure sustainable growth.
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