RBI Governor Das Confirms Approval of Multiple SROs for Fintech Sector

Reserve Bank Governor Shaktikanta Das announced on Wednesday that the central bank will allow at least two industry bodies to function as self-regulatory organisations (SROs) for the fintech sector. Das mentioned that the Fintech Association for Consumer Empowerment (FACE) has already been approved as it met all the criteria. He also indicated that the RBI is considering two other applicants.

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Fintech Sector Self-Regulation

When questioned about limiting the number of SROs to one, Das dismissed the idea. "There are three applications. We are looking at multiple. I think maybe 2-3 SROs should be sufficient at this point in time," he stated during the Global Fintech Fest. The governor clarified that all three bodies applied for the SRO license at different times, and the central bank is evaluating each application.

Das addressed concerns about increased non-performing assets (NPAs) in the microlending segment, stating that the RBI is closely monitoring all aspects of the credit market. "Whenever there is any concern in any segment, the RBI will be proactive and take necessary measures," he assured. He emphasised that they are keeping a close watch on credit growth.

Monitoring Credit Growth

Regarding deposit growth concerns, Das said banks are aware of the issue and are taking appropriate actions. "We should allow them some time to see the results," he added. This statement highlights the central bank's confidence in banks' ability to manage deposit growth effectively.

The governor's comments reflect a proactive stance by the RBI in ensuring stability and growth within the fintech sector and broader financial markets. By permitting multiple SROs, the RBI aims to foster a more regulated and secure environment for fintech operations.

In summary, Shaktikanta Das's remarks underline the central bank's commitment to overseeing and supporting various segments of the financial market, including microlenders and deposit growth, while promoting self-regulation within the fintech industry.