India cenbank chief urges fintech firms to form a self-regulatory body

FILE PHOTO: G20 Finance Ministers' and Central Bank governors' meeting at Gandhinagar

MUMBAI (Reuters) - Financial technology companies should create a self-regulatory body to address their needs and challenges, the Reserve Bank of India Governor Shaktikanta Das said on Wednesday, as the industry grows at a break-neck speed due to surging demand for digital payments and borrowings.

"I would like to use this opportunity to urge and encourage the fintechs to establish a self-regulatory organisation or SRO themselves. From the Reserve Bank, we are willing to engage with you," Das said while delivering the keynote address at the Global FinTech Fest 2023 (GFF).

"It (SRO) will give you (fintechs) an opportunity to voice your requirements more frequently to the SRO. The other advantage is that all the aspects of regulation will not be burdened on the Reserve Bank."

Das said he was hopeful that the fintech industry would have either formed, or be close to launching a SRO by the time of the next GFF event in 2024.

"I am saying next year as an outer limit but I am sure if we work together, we can do this even faster."

Such a body could play a vital role to facilitate collaboration among companies, regulators and stakeholders, while creating guardrails for the industry, Deputy Governor T. Rabi Sankar said at the first day of event on Tuesday.

"By proactively addressing issues like market integrity, conduct, data privacy, cybersecurity, and risk management, SROs help build trust among consumers, investors, and regulators," he added.

(Reporting by Siddhi Nayak and Swati Bhat; Editing by Dhanya Ann Thoppil)