Taxation Code, Bankruptcy Law, DPI Helped Attract Investment For India, Says WEF Official

Matthew Blake, Head of the Centre for Financial and Monetary Systems at WEF, noted India's exceptional performance in global markets, attracting substantial investments

The January edition of the WEF-Cambridge report on 'The Future of Global Fintech: Towards Resilient and Inclusive Growth' revealed that most financial technology firms maintain a favorable perception of their regulatory landscape

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A senior World Economic Forum (WEF) official highlighted that a combination of policy changes such as bankruptcy law and taxation code, as well as the enabling environment created by digital public infrastructure (DPI), have made India an appealing investment destination for the financial technology sector.

According to PTI, Matthew Blake, Head of the Centre for Financial and Monetary Systems at WEF, noted India's exceptional performance in global markets, attracting substantial investments.

Blake also cautioned that there was a need to educate investors because markets do not move in a purely linear fashion and are prone to "ups and downs". "So this idea of being an informed investor, a diversified investor, and having access to educational resources to do that is really fundamental artificial intelligence (AI)," he stated.

"I think a combination of different policy choices that have been made make India quite an attractive investment destination. In addition to the digital public infrastructure that creates an enabling environment from a technological standpoint, you also have changes in the bankruptcy law and taxation code adding clarity," he also said.

AI Can Benefit In Risk Management: Blake

According to Blake, a survey of fintech CEOs conducted by the WEF and the Cambridge Centre for Alternative Finance found that 70% of firms saw AI as a major force that could be used to personalise and customise products and services. Blake also stated that sectoral regulators could benefit from AI in terms of risk management and that they must adapt to rapid technological changes.

"The sophistication level of the regulatory authorities will also need to increase commensurate with the business sector and talent. Technology, and technologically savvy talent, will be at a premium. And that's true in the private sector, and that's true in the public sector," he outlined.

Blake emphasised that in the Asia-Pacific region, regulatory agencies were generally regarded as highly skilled.

"When you look globally, obviously there are varying levels of sophistication of markets. This brings an opportunity globally to share best practices and competencies," he added. "One of the things that we're looking at is how do you bring the most sophisticated actors in the financial services space from the private sector together in a knowledge exchange with some of the key supervisory bodies," Blake further added.

"It is absolutely in the best interests of the business sector that their corresponding regulator understands as closely as they do their activities and the technologies they're using to conduct those activities. So, it is in the mutual best interest to share that information and to try and level set. That is a rather large challenge, but it's something that we as a team are looking at currently and trying to devote some time to," Blake emphasised.

The January release of the WEF-Cambridge report on 'The Future of Global Fintech: Towards Resilient and Inclusive Growth' revealed that most financial technology firms maintain a favorable perception of their regulatory landscape, with 63 per cent deeming it satisfactory. Furthermore, 38 per cent of the surveyed fintech companies identified the regulatory framework as a significant contributor to their operational effectiveness and expansion.