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Fintech firms struggle to come together for self-regulation
April 21, 2023
Deeply impacted by the ever-changing regulatory landscape of the country, digital payments players are in talks to set up a self-regulatory organisation (SRO) to create common rules and standards of operation for their business.
The idea of creating an SRO was mooted by the Reserve Bank governor at a conference organised by the Department of Payment and Settlement Systems in March. But more than a month since, the companies haven’t been able to proceed beyond initial discussions to band together and get the groundwork laid out.
Two people in the know of the matter told ET that the Payments Council of India (PCI), an industry body of payment players, wanted to take on the role of an SRO. But the central bank opposed the application, as the PCI has multiple unregulated entities as its members. The council is a subsidiary of the Internet and Mobile Association of India (IAMAI), which counts large tech majors like Facebook, Google and Amazon among its members.
“The RBI wants all regulated payment companies to come together and form a single SRO,” said the founder of a platform who was present at the March 18 conference in Kochi where governor Shaktikanta Das suggested the idea. This industry executive spoke on the condition of anonymity given the matters are still at a discussion level.
Coming together to form a self-regulatory body is a challenging task for the payments industry given its diverse players, like UPI apps, mobile wallet companies, ATM service providers, clearance corporations, business correspondents and others.
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