India’s LEAP to build a global fintech hub
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India Fintech Opportunities Review survey was recently conducted by YES BANK to comprehensively understand fintech landscape in India. The survey findings indicate that talent, capital, regulatory support and collaboration between fintech industry stakeholders need attention for a structured growth of India’s fintech sector. The IFOR 2018 survey recommendations present a LEAP proposal for transforming India into a global fintech hub. LEAP stands for Lighter Regulatory Compliance, Enabling Environment, Augment Infrastructure and Partnership with global hubs.

Regulatory relief, open APIs, funding gateways and more
One of the major problems faced by fintech startups is the lack of understanding of the numerous regulatory requirements and compliance checks. Fintech itself being a dynamic domain, regulatory compliance costs just add on as hurdles in taking the innovative fintech products or solutions to the market. As per the IFOR survey, a dedicated window to connect with the regulator as well as Regulatory Sandbox can be one the solutions that the regulator and the industry stakeholders can explore to address this gap. An inter-regulatory working group chaired by Sudarshan Sen, ED, RBI has already proposed a Regulatory Sandbox to be governed by IDRBT. Since RBI is exploring the regulatory models for the Sandbox, IFOR suggests setting up a Regulatory Advisory Group (RAG) till the Regulatory Sandbox begins functional to understand the type of waivers and relaxations that nimble fintechs are looking for. IFOR survey findings also match up the findings of the Sudarshan Sen Committee and recommend a single point entity or fintech association to connect with the global as well as India ecosystem. The fintech entity can be built on the previous successful models that have worked for global fintech hubs like Innovate Finance UK, FSTI Singapore and Fintech Australia. This association will give a formal interface for bringing together fintech industry, academia and the policymakers to participate in mutually-beneficial engagements.

With IndiaStack, the Government of India (GoI) has already introduced open APIs to facilitate innovation. To take GoI’s initiative further, IFOR recommends Open Data or API Frameworks for delivering cost-effective and timely solutions for Government to Citizen (G2C), Government to Government (G2G), Government to Employee (G2E) and Government to Business (G2B) services. IFOR recommends API creation of data stacks focussing on the priority sectors like Agri, education, MSME and healthcare amongst others.

A report by International Finance Corporation (IFC) suggests a gap of INR 2.93 trillion in SME financing, which presents a huge opportunity to nimble fintechs. IFOR recommendations suggest creation of a unified invoicing platform and registry for MSMEs will address a majority of challenges in financing MSMEs as they revolve around the lack of data.

IFOR recommendations also included the creation of dedicated applied research grants for projects in emerging technologies like AI, IoT and Distributed ledger, in partnership with top academic institutions in the country. These grants will help with bridging the gap between research and commercialisation of solutions, not only in the financial services sector but for use cases across other priority sectors as well.

Funding is always a priority concern for fintech startups dealing with nascent technologies. According to the IFOR survey findings, creating a dedicated PoC fund and relaxed taxation norms for investors can increase access to growth capital for startups.

Collaborate to be future ready
The world is witnessing rapid advancements in fintech with the rise of global fintech hubs in various nations. Collaboration with these global fintech hubs will be valuable for the growth of Indian fintech industry too. To benefit from the global fintech hubs across the world, IFOR recommends building a fintech bridge for knowledge transfer, educational tie-ups, participation in innovation projects and assistance in global expansion for fintech entrepreneurs and innovators. India’s fintech sector can also flourish through growth initiatives such as co-creation of products or solutions through strategic partnerships. These can be partnerships between government departments, regulatory authorities or academia as well.

For the development of future-skilled human capital catering to the fintech sector, the IFOR survey proposes setting up of multi-disciplinary centres of excellence at academic institutes. These centres will focus on research in highly specialised areas such as Cybertech, Big Data Analytics, Reg-tech, Blockchain, AI and more in PPP mode. Currently, MOOCs by leading foreign educational institutions are offering programs in AI, Blockchain, Machine Learning and so on. Accreditation of specific MOOC programs for inclusion in current curriculum, along with flexible knowledge exchange programs at educational institutions, are the suggested initiatives by IFOR, to churn out future skilled talent.

India Fintech Opportunities Review (IFOR) 2018 is a comprehensive study conducted by YES BANK for identifying the opportunities and challenges in the Indian fintech sector. Based on the survey findings, the recommendations were put forth by an eminent panel of fintech industry experts, influencers and researchers from India and abroad.

To download the complete survey report, you can visit

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