Finance Minister Sitharaman Asks RBI To Hold Monthly Meetings With Start-Ups, Fintech Firms

The timing of the meeting with start-ups coincides with increased scrutiny on regulatory compliance within the fintech industry, particularly highlighted by RBI's actions against Paytm Payments Bank

In a bid to address the concerns of start-ups and fintech companies, Finance Minister Nirmala Sitharaman asked the Reserve Bank of India (RBI) to conduct monthly meetings, officials revealed on Monday. During a gathering with top executives representing about 50 start-ups and fintech firms, Sitharaman also called upon the Department of Financial Services to arrange a meeting between start-ups and law enforcement agencies.

The timing of the meeting with start-ups coincides with increased scrutiny on regulatory compliance within the fintech industry, particularly highlighted by RBI's recent actions against Paytm Payments Bank.

An official statement following the meeting stated, "During the deliberations, Sitharaman exhorted the regulators, including RBI, that they may hold meetings via virtual mode once a month to discuss any questions/queries/concerns of the start-ups and fintech companies."

Reportedly, start up founders and fintech entities did not express specific concerns related to Paytm during the meeting. Representatives from leading private sector entities such as Policybazar, MakeMyTrip, Razorpay, CRED, and venture capital firm PeakXV attended the meeting held on Monday. Additionally, notable figures including SBI Chairman Dinesh Khara and officials from NPCI, Canara Bank, and Bank of Baroda were present.

Key topics discussed during the meeting included simplification and digitisation of KYC across all fintech segments, proactive measures against cyber frauds, and regulatory compliance regarding changes in ownership/control of listed fintech companies. The government assured companies that cybercrime concerns would be addressed in the new Digital India Act.

Moreover, the Department for Promotion of Industry and Internal Trade (DPIIT) committed to reducing the turnaround time of patent applications. The meeting aimed to facilitate a free exchange of ideas to enhance operations and global competitiveness in the fintech sector. With approximately 10,244 fintech entities, India stands as the third-largest fintech market globally.

Acknowledging the rapid growth of India's start-up and fintech sectors, Sitharaman welcomed suggestions from fintech leaders to enhance Ease of Doing Business and Ease of Living for consumers.

The meeting was attended by key government officials including Financial Services Secretary Vivek Joshi, DPIIT Secretary Rajesh Kumar Singh, and MeitY Secretary S Krishnan, along with RBI Deputy Governor T Rabi Sankar.

Underscoring the importance of innovative solutions while ensuring regulatory compliance, the meeting highlighted the role of enablers such as Aadhar, UPI, and API Setu in facilitating the start-up and fintech ecosystem in India. Additionally, processes and efficacy of GIFT City were appreciated by the start-up and fintech entities.