The work started by demonetisation is still not complete. There are still large swathes of our economy where cash still rules. We need more impetus from the government for cash digitisation. Given that payments technology is a foundational stone of any business, govt needs to increase spending to drive adoption of payment technology by SME and individuals. This will have roll over effect in faster and easier disbursements in business lending.
While we have made new innovations with UPI, we believe more such innovations are necessary to bring advance financial capabilities to Indian consumers. Directives like Europe’s PSD2 could change the way we think about banking and are much needed in India, where the few large banks have disproportionate control over retail banking platforms. This stymies innovation and openness.
Stable long-term Policy
Ideally we want the government and the RBI to have a stable long-term policy framework for adoption and innovation in online financial services. Arbitrary changes in policy erode confidence in such institutions.
We need more transparency in our financial markets and our regulatory bodies. Decision making in organisations like RBI seem shrouded in mystery for large parts. Similarly SEBI also lacks in enforcing stricter controls over the financial markets. Last year we saw multiple whistle blowers speaking up against the high and mighty of Indian businesses, we also saw insider trading allegations being made and thus stricter enforcement of rules will help make our markets more secure and fair.
2018 was a great year for the fintech industry in terms of new technologies and innovation. The continued focus from the Government for expanding digital penetration also saw a promising growth in the adoption of digital platforms across metro cities and tier-II markets.
In the near future, digital channels of engagement such as digital payments, money transfers, consumer lending will continue to grow. To strengthen this growth, we hope the budget can encourage the upgradation of digital infrastructure and digital literacy – especially in small towns and rural India, which will help drive financial inclusion through digitisation. Some of the recent initiatives such as UPI 2.0 and tokenisation provide a good opportunity for banks, e-wallets, and other players in the fintech sphere to promote digital adoption. The fintech players should continue to focus on innovation, adding smart offerings to provide relevant and personalized customer experiences and strengthening the digital payments ecosystem in the country.