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Fourth Industrial Revolution will be shaped by India; FinTech to play important role: Injeti Srinivas, Chairman, IFSCA

Mar 10, 2021

Open Credit Enablement Network & Account Aggregation framework to democratize access to credit: K Rajaraman, Additional Secretary, (DEA), MoF

NEW DELHI, 10 March 2021: Mr Injeti Srinivas, Chairman, IFSCA today said India can be the frontrunner in the fourth Industrial revolution. India did not play a large role in the first three revolutions. "We already have with us all the ingredients to lead the way. Potential for fintechs is enormous and the Fourth Industrial revolution will be shaped by India," he added.

Addressing the virtual 'FICCI Fintech Expo 2021 and Conference - Showcasing Indian FinTechs to the World', Mr Srinivas said that creation of a world class fintech hub, as announced in the budget recently, also highlights the importance of fintech in India. "IFSCA can act as the second engine of the Indian economy. It can be the external engine that will not only channelize global capital flow into India but also provide international jurisdiction to companies wanting to explore global markets," he added.

The IFSCA, he emphasized, attaches huge importance to developing a fintech hub in India. "We want to be the frontrunners in this. Under the IFSCA, you (the industry) have a unified regulator who regulates all the segments of the financial sector. For fintech to have an international presence, this is another viable option," added Mr Srinivas.

Technology is transcending the limitations of time, space, and cost and by nature it is democratic. There is no use of a technology if it is not easily accessible and affordable. "We are at the epicentre of making technology available, accessible and affordable and finance is the lifeblood of an economy. Technology and finance are common to all services," added Mr Srinivas.

He further emphasized that there is enormous potential in India but only a fraction of the economic transactions happens digitally. The government's Direct Benefit Transfer scheme, Digital India, Start-up India, UPI initiatives have been a great trigger to this process combined with the talent at the grassroots level that made use of this opportunity. "With government's announcements and IFSCAs pro-active initiatives it is the right time that this opportunity should be tapped," said Mr Srinivas.

Mr K Rajaraman, Additional Secretary (Investment and IER), Department of Economic Affairs, Ministry of Finance, Govt of India said that India's digital infrastructure has played an important role in mitigating the impact of COVID-19 by facilitating access to finance at remote locations and by aiding the effective deployment of government measures like DBT.

He added that the journey of financial inclusion started with the launch of Pradhan Mantri Jan-Dhan Yojana (PMJDY) in 2014. Powered by India Stack and the JAM trinity, today, nearly 400 million people benefit from it.

"UPI-led innovations are clocking in an astounding two billion transactions a month. The two new frameworks ready to add more value and vibrancy to the India Stack Powered Digital Ecosystem include OCEN (Open Credit Enablement Network) and Account Aggregation Framework. The entire idea is to democratize access to credit," added Mr Rajaraman.

He further said that several countries around the world are facing challenges of governance and providing services to the citizens is accentuated by the lack of digital infrastructure. India can be a lead model, he emphasized.

Mr Sunil Mehta, Chief Executive, IBA said that the banking industry is undergoing a transformation. Today we are moving towards phygital and the future will witness digital banking system. "Today, more than 70 per cent of the banking transactions are happening via digital mode," he added.

Mr Rashesh Shah, Past President, FICCI and Chairman and CEO, Edelweiss Group said that financial services in India is not about demand and supply, it is about the cost of supply. India has become the fifth largest fintech investment destination in 2020. Competition along with technology is changing the financial scenario in India, he added.

Mr Sudhakar Ramasubramanian, Advisor, FICCI Fintech Committee said that with a strong regulatory vision followed by successful implementation of various initiatives, a digitally friendly market, strong STEM talent base and a great investor and institutional support have all come together in a synchronized manner to establish one of the world's most successful fintech industries in India.

Mr V Govindarajan, Co-Chair, FICCI Fintech Committee and Co-Founder and Director, Perfios said, "Some form of handholding and help by the government through the IFSCA towards the smaller fintech companies will be highly appreciated."

Mr Dilip Chenoy, Secretary General, FICCI said fintech start-ups are taking initiatives, innovating, and looking at integrating into the financial system. We must enable inclusion and take it international, he added.

Mr Ruchin Goyal, MD & Senior Partner, BCG also shared his perspective on factors that aid successful forays into the global market by fintechs.

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