The Finance Ministry has reportedly worked on defining fintech sectors regulatory guidelines and policies. These guidelines and procedures are meant to boost the growth of India’s fintech sector.
The release of the report has been put on hold in lieu of the ongoing Lok Sabha elections. Two anonymous finance ministry officials cited that, “The report has been finalised. We can’t make it public at the moment, due to the model code of conduct guidelines issued. But it will be released after the election is over (May 23rd).”
Reportedly an eight-member team was set up in March 2018 to work on this report of guidelines and policies under the supervision of the Finance Secretary Subhash Chandra Garg. Reports suggest that the other members of the committee include Ministry of Electronics and Information Technology Secretary Ajay Prakash Sawhney; Financial Services Secretary Rajeev Kumar; and the Secretary of MSME Arun Kumar Panda.
The committee is reportedly working on forming a regulatory regime for the sector. They have been contemplating the setting up of a ‘sandbox’ to nourish innovation in the sector.
The sandbox would act as a safe space for companies to beta-test new application based financial services in a live environment. It will also enable the government to regulate these new services.
The government is focused on boosting the fintech sector given it’s growing penetration and countrywide adoption of digital financial services such as Aadhaar, UPI and eKYC. Companies like Paytm, Phonepe and Google Pay have become the go-to transaction service providers among Indians in the last couple of years.
The Reserve Bank of India has released a draft ‘Enabling Framework for Regulatory Sandbox’ which is aimed at enabling fintech startups. RBI has enrolled 10-12 companies form the sector for its 26-week regulatory sandbox.