RBI Guv Das asks fintech players to form self regulatory organisation

Fintech players should form a self regulatory organisation for an orderly growth of the industry that is projected to have revenues of USD 200 billion by 2030, RBI Governor Shaktikanta Das said on Wednesday.

Addressing the industry at the Global Fintech Fest here, Das said fintech players need to evolve industry best practices to avoid misselling, stress on ethical practices, pricing transparency and take care of privacy and data protection concerns.

"I would like to use this opportunity to urge and encourage the fintechs to establish a Self Regulatory Organisation (SRO) themselves," he said and assured all help from the Reserve Bank of India (RBI) for the process.

The fintech players should form the SRO at the earliest, Das said and hoped that such a platform will be ready at least by the next edition of the yearly event.

Stating that other industries also have SROs, Das said forming an SRO will help the players to voice their concerns.

He also said that having the SRO will reduce the burden of regulating a dynamic sector off the RBI's shoulders.

Das said regulators play a critical role in addressing arbitrage, ensuring compliance with existing laws, and adopting regulations as per technological advancements.

Further, he asked the fintech players -- most of them startups -- to avoid the "relentless drive for valuations" and profits, and asked them to focus on customer centricity.

" to focus on customers means embracing a customer-centric approach to innovation by understanding the needs of customers, making provisions that protect customer interests and earn their trust," he added.

He said that good governance will be key to durable and long term success of any company and in particular, the fintech players.

Technological innovation has "unprecedented potential" to make finance more inclusive, competitive and robust, Das said, adding that advancements in technology need to evolve in a "responsible" manner.

"Fintech players should themselves ensure responsible digital innovations. The Reserve Bank on its part will continue to drive the necessary regulatory and other policy measures to promote a vibrant and responsive fintech ecosystem," he said.

While stressing that the coming years hold immense promise which need to be leveraged by innovators, the RBI chief said that as per projections, the fintech sector revenues are set to touch USD 200 billion by 2030. "We are at the cusp of a major transformation in fintech sector".

Das also spoke about the progress on the Central Bank Digital Currency and said that newer use cases will be soon added on the wholesale CBDC front.