What to expect from fintech companies

New Delhi:

Finance Minister Nirmala Sitharaman will present the federal budget on February 1.

In light of the upcoming Budget, NBFCs (non-banking financial companies) and financial technology companies (fintechs) would like to see the expansion of digital services across the country and greater clarity on governance and regulation.

What fintechs and start-ups can expect from Budget 2023:

Sandbox supervision

Measures to improve the regulatory environment would be welcomed by fintech firms. A dedicated fintech regulator or the implementation of a sandbox-style regime that could safely allow companies to test new products and technologies would be welcome moves. Being able to test and try new products without fear of penalties will help fintech companies grow.

Need for a level playing field

Industry experts point out that the fintech industry wants to level the playing field for both online and offline providers. Industry players have been asking the RBI to put in place a regulatory structure to manage the fintech industry. Industry players want more clarity on regulatory norms, which will help companies in the industry operate.

Supporting the fintech start-up ecosystem

Fintech start-ups want tax breaks in Budget announcement. Tax rebates for angel investors and venture capitalists and subsidies for fintech start-ups will attract more investment in the fintech sector. Reducing red tape will encourage fintech firms to expand their networks and bring newcomers under the financial services network.

Support digital payment

Digital payments have become increasingly popular over the years. Fintech companies will expect the policy announcement to boost digital payments in the country. Industry players will await plans and policies to incentivize customers to use digital wallets. Incentives such as GST (Goods and Services Tax) exemption for digital transactions in rural and semi-urban areas will accelerate the growth of companies operating in the payments space.

Strengthen digitalization

Fintech companies expect the digitization and expansion of internet services in rural areas to help their expansion. A rise in plans to bring the internet to more people’s doorsteps could boost these companies’ bottom lines.