“We do not intend to penalize anyone or obstruct any activity, all I am saying is please follow the traffic rules,” Das said. “We are not painting everyone with the same brush, there are regulated entities and there are unregulated entities. We have made the difference clear.”
The Governor also said that while the Center will continue to support technological progress and innovation, it is equally important that the issues of governance and conduct get adequate attention.
“At the end of the day, the sustainability of any fintech activity or business is about better customer protection, better cyber security and resilience, managing financial integrity, and stronger data security,” the governor said. “I want to assure the fintech community that reserve Bank of India Will continue to encourage and support innovation.”
The governor said that while the central bank will help in innovation, it expects the ecosystem to focus on governance, business conduct, regulatory compliance and risk mitigation framework.
“The fintech road ahead will witness ever-increasing traffic in addition to the already large number of existing players,” he added. “Therefore, it is imperative that every player on this road obeys the traffic rules for his own safety and the safety of others.”
The governor also clarified that top RBI officials were still considering how to treat the rules around First Loss Default Guarantee (FLDG) and a decision would be taken after taking feedback from stakeholders.
“We have said that FLDG (First Loss Default Guarantee) is being probed.
“We have not decided because the consultation is not complete. We have received feedback from many stakeholders. But there were a number of issues that required a thorough investigation within the RBI. This is a separate exercise that is going on and we will come up with it when we consider it.”
The central bank last month issued a digital lending framework on all regulated entities such as banks and NBFCs to ensure that all guidelines on digital lending are met. The central bank also removed regulatory arbitrage and made it mandatory that money should flow only between banks/NBFCs and borrowers. It has asked the industry to implement these norms in all digital loans by November this year.
Governor Das said that the recently released regulatory guidelines on digital lending support a deliberate balance between customer protection and business conduct on the one hand and innovation on the other.
Das also introduced linking Rupee credit card to is i The platform, UPI Lite which facilitates small value payments and another facility that enables cross-border inward bill payments using India bill payment system (BBPS).