RBI forms inter-regulatory working group on FinTech

The Reserve Bank of India (RBI) has set up an inter-regulatory working group (WG) to study the entire gamut of regulatory issues relating to FinTech and digital banking in India.

The Financial Stability and Development Council - Sub Committee (FSDC - SC) at its meeting held on April 26, 2016 had decided to set up such a WG to look into and report on the granular aspects of FinTech and its implications so as to review and appropriately re-orient the regulatory framework and respond to the dynamics of the rapidly evolving FinTech scenario.

The WG has been set up in view of the growing significance of FinTech innovations and their interactions with the financial sector as well as the financial sector entities, RBI said. The terms of reference of the WG will be to undertake a scoping exercise to gain a general understanding of the major FinTech innovations, counterparties/entities, technology platforms involved and how markets, and the financial sector in particular, are adopting new delivery channels, products and technologies.

The WG will also assess opportunities and risks arising for the financial system from digitisation and use of financial technology, and how these can be utilised for optimising financial product innovation and delivery to the benefit of customers and other stakeholders.

It will also assess the implications and challenges for the various financial sector functions such as intermediation, clearing, payments being taken up by non-financial entities.