Sitharaman asks regulators to hold
Top executives from around 50 startups and fintech firms met the Union finance minister on Monday.
To address the issues and concerns of startups and fintechs, regulators must hold monthly meetings with such companies, and also lay emphasis on strict regulatory compliance, Union finance minister Nirmala Sitharaman said on Monday.
Sitharaman passed the directions at a meeting with top executives of about 50 startups and fintech firms; the meeting was held amid the Reserve Bank of India’s (RBI) crackdown on Paytm Payments Bank Limited (PPBL), the banking arm of One97 Communications-owned fintech major Paytm.
“Sitharaman exhorted the regulators, including RBI, that they may hold meetings via virtual mode once a month to discuss any questions/queries of the companies,” an official statement read.
From the private sector, representatives from Policybazar, MakyMyTrip, Razorpay, CRED, and PeakXV attended the deliberations.
Six action points finalised
According to the Economic Times, as many as six action points were put out after the meeting, which was also attended by State Bank of India (SBI) chairman Dinesh Khara, RBI deputy governor T Rabi Sankar, and officials from the National Payments Corporation of India (NPCI), among others.
The action points include include simplification and digitisation of KYC (Know Your Customer) across all fintech segments, interaction with law enforcement agencies to facilitate firms to raise their issues or concerns, etc.
There are around 10,244 fintech entities in India, the third-largest in the world.
Paytm shares today
Meanwhile, One97 Communications Limited’s shares, which witnessed a 5% jump a day ago, rallied 5% on Tuesday as well. While the stocks climbed 4.99% to ₹449.30 on the Bombay Stock Exchange (BSE), those on the National Stock Exchange (NSE) rose 4.99% to ₹449.50.
This came a day after Sharma, the founder of One97 Communications Limited, stepped down as the part-time non-executive chairman and board member of Paytm Payments Bank, ahead of RBI’s March 15 deadline to PPBL to stop adding new customers.
Additionally, PPBL reconstituted its Board of Directors, with the appointment of ex-Central Bank of India chairman Srinivasan Sridhar, retired bureaucrat Debendranath Sarangi, former Executive Director of Bank of Baroda Ashok Kumar Garg, and ex-IAS officer Rajni Sekhri Sibal.
The much-anticipated meeting comes amid the Reserve Bank of India’s actions against Paytm Payments Bank (PPBL).
The finance ministry put out six action points after the meeting which was also attended by RBI deputy governor T Rabi Sankar, State Bank of India chairman Dinesh Kumar Khara and officials from the National Payment Corporation of India (NPCI), among others.
These action points include simplification and digitisation of KYC (Know Your Customer) across all fintech segments and interaction with law enforcement agencies to allow fintech firms to voice their issues or concerns.
Cybercrime issues will be suitably addressed in the new Digital India Act, the finance ministry said in a statement after the meeting.
“RBI, DPIIT (Department for Promotion of Industry and Internal Trade) and MoF (ministry of finance) to look at the change of ownership holding/control of listed fintech companies to enable them to be in sync with regulatory compliance,” according to the statement.
Last week, ET reported that Sitharaman will meet heads of fintech firms in the backdrop of RBI’s action against PPBL.
Meanwhile, Vijay Shekhar Sharma resigned on Monday as part-time chairman and board member of PPBL. PPBL is an associate entity of One 97 Communications Ltd, the parent company which owns and operates the Paytm brand.
“Sitharaman exhorted the regulators, including RBI, that they may hold meetings via virtual mode once a month to discuss any questions, queries or conc ..
“Sitharaman exhorted the regulators, including RBI, that they may hold meetings via virtual mode once a month to discuss any questions, queries or concerns of the startups and fintech companies,” the ministry said in the statement.
Amid the Paytm Payments Bank crisis, Finance Minister Nirmala Sitharaman on Monday chaired a meeting with start-up and fintech ecosystem entities on Tuesday in New Delhi. 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 startups and fintech companies.
“The interaction with the Start-up and Fintech ecosystem partners was organised to enable free exchange of ideas to bolster and scale up operations to facilitate global competitiveness by enabling growth in the fintech sector. India has approximately 10,244 Fintech entities, which is 3rd largest in the world,” according to an official statement.
The Union finance minister noted the rapid growth of the start-up and fintech sector of India, especially in the last decade, and welcomed suggestions from the FinTech leaders to achieve greater Ease of Doing Business and Ease of Living for consumers.
The meeting was also attended by MoS Finance Bhagwat Kishanrao Karad; DFS Secretary Vivek Joshi; DPIIT Secretary Rajesh Kumar Singh; MeitY Secretary S Krishnan; RBI Deputy Governor T Rabi Sankar; and founders/ co-founders/ MDs/ CEOs/ heads of various start-ups and fintech companies. Various associations such as Fintech Association for Consumer Empowerment (FACE), Digital Lenders’ Association of India (DLAI), Payment Council of India (PCI), and Fintech Convergence Council (FCC) also attended the meeting.
No Paytm-related anxiety or concerns were shown by the startup founders or fintech entities during the meeting, an official said.
