Fintechs had ample time to comply with regulations

Regulations surrounding financial technology (fintech) companies have evolved over time, giving firms ample opportunity to comply. Now, these companies must prioritize corrective actions as they scale operations, industry players said at the Business Standard BFSI Insight Summit 2024.

- AJINKYA KAWALE & ANJALI SINGH

In recent years, India's fintech ecosystem has grown to become the third-largest in the world, with over 10,000 entities operating in the country. This growth, however, has brought major challenges, primarily in terms of compliance with regulatory guidelines.

During a panel discussion titled 'Navigating the Future of Fintech: Innovation, Regulation, and Growth', industry participants acknowledged that the sector has come to recognize the importance of innovation that aligns with regulatory spirit.

"Mistakes are made when firms are young. It is now time to correct those mistakes once and for all. The work required to do that demands considerable effort and intelligence, including processes and people," said Akshay Mehrotra, co-founder and chief executive officer (CEO) of Fibe (formerly EarlySalary), a Pune-based lending fintech firm.

Industry players said that regulatory bodies in India engage in private deliberations with firms, scrutinizing and evaluating them before taking any supervisory action.

"The industry is undergoing an evolution. Regulators have given fintech companies and the broader financial services sector ample time to adapt over the past few years. While regulators tend to be conservative on many matters, they are very calculated in their actions," said Anurag Jain, founder and chief operating officer of KredX, a micro, small and medium enterprise financing platform.