India's FinTech sector has attracted approximately $6 billion in investments over the past two years, with the number of FinTech companies in the country rising to around 11,000, Reserve Bank of India (RBI) Governor Shaktikanta Das said on Wednesday.
Speaking at the 5th Global Fintech Fest, Das highlighted India's rapid growth as an economic powerhouse with a tech-savvy population, noting the significant transformation of the nation's financial sector, driven in part by the FinTech industry.
Outlining the priorities for India@100, the RBI Governor stated that the journey ahead will be shaped by dynamic shifts in technology, regulation, geopolitics and societal expectations.
He emphasised that financial institutions and FinTech startups must swiftly adapt, employing agile strategies and robust frameworks to capitalise on emerging opportunities while mitigating associated risks.
Das stressed the importance of prioritising digital financial inclusion to build a financial system that serves the broader society.
While considerable progress has been made in expanding financial inclusion, he said the focus must now shift towards promoting Digital Financial Inclusion (DFI) — enabling secure and digitally-enabled financial services for the financially excluded and underserved population.
The RBI Governor noted that DFI offers scalability and cost-effectiveness, predicting that the next two decades will largely revolve around leveraging technology to provide accessible, tailored financial services to meet diverse needs.
Das identified the further deepening of Digital Public Infrastructure (DPI) as a second key policy priority. He highlighted that DPI, which includes frameworks like Digital Identity (Aadhaar), Universal Fast Retail Payments (UPI) and targeted payment solutions, will enhance the overall efficiency of the financial system.
DPI will also be critical in promoting interoperability, transparency and cost-effectiveness, and could address emerging challenges such as fraud, cyber threats and data privacy concerns. Additionally, DPI could facilitate the integration of advanced technologies like blockchain and AI to boost security and efficiency in financial services.
Continuous innovation is essential to harness technological advancements and maintain a competitive edge in the global financial landscape, Das said. He pointed to the Reserve Bank's pilot on the Unified Lending Interface (ULI) as a significant initiative in this direction.
The RBI Governor also underscored the need for robust consumer protection, which is crucial for maintaining trust in the financial system.
“As consumers increasingly rely on digital financial services, their expectations for personalised, efficient and seamless experiences are growing,” Das said.
“In addition to traditional risks such as mis-selling and fraud, new consumer risks, including data privacy and security breaches, have emerged with the advent of new technologies. Leveraging technology for real-time monitoring and ensuring regulatory compliance will be essential to address these challenges effectively,” he added.
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