“No dearth of financial innovation and imagination in the country”: Shri M Nagaraju, Secretary, Department of Financial Services, Ministry of Finance, Government of India

“India’s fintech industry is the largest in the world and unlike in some other parts of the world its spread across several sectors”, stated Shri M Nagaraju, Secretary, Department of Financial Services, Ministry of Finance, Government of India, during the inaugural session at the Financial Inclusion and Fintech Summit of the Confederation of Indian Industry (CII) in New Delhi today. In his Inaugural address, Shri M Nagaraju explained that the government remains committed to the goal of financial inclusion and it is working closely with the fintech industry to attain greater inclusivity especially in areas which remain under-penetrated.

“The Government is making a lot of efforts to foster ease of doing business and reduce compliance burden for the Fintech companies”, underlined Shri M Nagaraju. He underscored the government’s continuous endeavor to provide a facilitating ecosystem to the fintech industry including robust digital infrastructure as well as schemes such as PM Suraksha Bima Yojana and Atal Pension Yojana, which could bring huge opportunities for the industry.

While highlighting the importance of greater collaboration, Mr. M Nagaraju appreciated Confederation of Indian Industry for working closely with the government and the industry both in some of these endeavors.

"A fine balance is required between fostering innovation and protecting the regulatory system’s integrity," said Shri M Nagaraju while talking about some of the challenges the financial industry faces today. He stressed the importance of regulatory compliances to be able to stay one step ahead of fraudsters in the industry. Data privacy, cyber security etc. are some of the imperatives that need to be ensured along with a thriving fintech industry.

Shri M Nagaraju also highlighted the need of greater financial literacy not just for younger people but also for older generation to democratize the benefits emerging from greater innovations.

Shri Shaji KV, Chairman, NABARD, emphasized the need to bring about the technological transformation in a more democratic manner especially in the rural economy. He highlighted that while bigger banks have benefited from greater digitization, cooperative banks and regional rural banks may not have reaped the benefits of digitization to a similar extent. Given that these banks may not have sufficient funds to invest in new technologies, it is important that all stakeholders make a greater effort to include RRBs and cooperative banks in new digital endeavours. In this context, he recommended that the fintech companies could capitalize on recently announced government schemes to bring in enhanced equitability of growth in the country.

Mr Prashant Kumar, Chair, CII National Committee on Fintech and Managing Director and CEO, Yes Bank, underscored the importance of inclusive economic growth. He highlighted that the fintech sector could play a crucial role in broadening economic participation in the country wherein a favorable working age population will act as a multiplier. Not only will this lead to greater economic development but also propel financial inclusion thereby supporting the government’s aspiration of Viksit Bharat by 2047. In this context, he mentioned the RBI Financial Inclusion Index, which shows a gain to 64.2 as of March 2024 over 60.1 in March 2023.

Mr Sameer Nigam, Co-Chair, CII National Committee on Fintech and Founder & CEO, PhonePe Pvt Ltd, shared his enthusiasm on the Indian economy and said that the economy is at the cusp of the biggest revolution the world may have seen in financial inclusion and fintech space, other than that of China. He highlighted that the real purpose of technology is to bring in transformation democratically and that should be the driving agenda for all stakeholders – to deliberate on how to induct people who have been left out into the system.

While, releasing the CII Financial Literacy Handbook, Mr Sanjay Doshi, Partner and Head – India FS Advisory and Transaction Services, KPMG, emphasized that the goal of greater financial inclusion hinges significantly on financial literacy, which needs to be comprehensive in coverage – from basic fundamentals of saving, investment & spending to the newer innovations like digital currencies as well as educating on some of the challenges related to data privacy and cyber security.

In his concluding remarks, Mr Prashant Kumar Chair, CII National Committee on Fintech and Managing Director and CEO, Yes Bank, highlighted that while a lot of progress has been made in terms of inclusiveness on the access and the deposit side, there is a huge opportunity that needs to be tapped on the lending side. This could be the next big driver of both financial inclusivity and technological innovation in the financial industry.

26 November 2024

New Delhi