RBI sets up panel to study fin tech, digital banking
15 Jul 2016
The Reserve Bank of India (RBI) has set up an inter-regulatory working group to study the entire gamut of regulatory issues relating to financial technology and digital banking in India.
The working group has been set up in view of the growing significance of fin tech innovations and their interactions with the financial sector as well as the financial sector entities.
The Financial Stability and Development Council - Sub Committee (FSDC - SC) at its meeting held on 26 April 2016 had decided to set up such a working group to look into and report on the granular aspects of Fin Tech and its implications so as to review and appropriately reorient the regulatory framework and respond to the dynamics of the rapidly evolving fin tech scenario.
The working group, headed by RBI executive director Sudarshan Sen has 12 members, including MD and CEO of National Payments Corporation of India A P Hota, director of the Institute for Development and Research in Banking Technology AS Ramasastri, deputy managing director and CIO of State Bank of India Mrutyunjay Mahapatra and the head of digital banking at HDFC Bank Nitin Chugh.
The working group will undertake a scoping exercise to gain a general understanding of the major fin tech innovations, developments, counterparties, entities, technology platforms involved and how markets, and the financial sector in particular, are adopting new delivery channels, products and technologies.
It 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 users / customers and other stakeholders.
It will undertake detailed study of the implications and challenges for the various financial sector functions such as intermediation, clearing, payments being taken up by non-financial entities, besides examining cross country practices in the matter, to study models of successful regulatory responses to disruption across the globe.
The working group will chalk out appropriate regulatory response with a view to re-aligning and re-orienting regulatory guidelines and statutory provisions for enhancing fin tech / digital banking associated opportunities while simultaneously managing the evolving challenges and risk dimensions as also any other related issues.
The working group may invite views from representatives from any area relevant to its terms of reference and may also, at its discretion, co-opt entities in the payment, telecom, software and start-up ecosystem.
The group has been asked to submit its report within six months from the date of its first meeting.
