Union Budget 2024: What The FinMin Should Continue Doing And What It Should Consider Changing

Union Budget 2024: This marks the first budget of the Modi 3.0 govt, and industry leaders and the common man are palpably anticipating it. They expect several new reforms to be announced on July 23

Union Budget 2024: Union Finance Minister Nirmala Sitharaman is all set to present the Union Budget for the fiscal year 2024-25 on July 23 in the parliament. This marks the first budget of the Modi 3.0 government, and there is a palpable sense of anticipation. Experts are particularly hopeful for tax relief in their respective sectors and a significant push in infrastructure development.

A report released by BankBazaar delves deeply into how the budget has evolved from fiscal year 2012-13 to 2024-25. The report elaborates on what the finance ministry has been doing greatly and should continue, along with what changes can be considered for this year

Initiatives Finance Ministry Should Continue Taking Forward

The Union Budget has been instrumental in promoting progressive digital initiatives, a necessity of the hour. It's crucial for the Finance Ministry to continue these initiatives that enable paperless and presence-less access to credit, such as Video KYC, and enhance fintech innovation and customer convenience. Furthermore, the budget's focus on promoting financial inclusion, with initiatives like India Stack driving a digital revolution in credit access, should be sustained to further economic growth.

The budget's recognition of FinTech's strategic importance is a significant step. This crucial sector, driven by intellectual property, makes a substantial contribution to India's economic growth and global leadership in fintech innovation. The budget should continue to include provisions for enhancing platforms that facilitate collaboration between banks and compliant FinTech firms, with a focus on financial inclusion and fostering sustainable economic growth.

Support to the startup ecosystem has been a big plus in the budget, and it should continue to bolster FinTech and MSME startups with tax incentives and policy frameworks that foster innovation and attract investors.

Finance Ministry Should Focus On

The budget should foster regulations promoting Bank-FinTech partnerships. It should enhance the RBI regulations to facilitate and streamline partnerships between banks and FinTech companies, fostering a collaborative environment for financial innovation and inclusion. In addition, it should also include measures to improve DigiLocker integration with income tax and provident fund.

Enhanced integration with DigiLocker to include crucial financial documents such as Form 26AS, e-PAN, and EPFO Passbook will ensure seamless access to financial services.

The finance ministry should allocate 25 per cent of the Rs 1 lakh crore "Anusandhan" fund to FinTech innovation as it will catalyse innovations in digital credit access and financial empowerment, driving India's leadership in global FinTech innovation. It should also align the taxation of long-term capital gains for unlisted equities with that of listed equities to stimulate investment in the expanding FinTech sector.

In addition to all these, the budget should include the idea of having thorough personal finance education in primary and secondary school curricula to foster financial literacy across society.