Important updates from RBI! Now implement UPI in Singapore and Dubai as well; the fintech industry has undergone significant upheaval as a result of these five RBI directives

 Important updates from RBI! Now implement UPI in Singapore and Dubai as well; the fintech industry has undergone significant upheaval as a result of these five RBI directives

These days, fintech is a part of daily existence. The world has transformed in only two decades due to the convergence of "technology" and "finance." The fintech industry has produced several breakthroughs, without which it is impossible to envision the current generation. By its judgments, RBI has also contributed significantly to the growth of fintech.

These days, fintech is a part of daily existence. The world has transformed in only two decades due to the convergence of "technology" and "finance." The fintech industry has produced several breakthroughs, without which it is impossible to envision the current generation. By its judgments, RBI has also contributed significantly to the growth of fintech. The RBI has made many significant moves for the fintech industry this year as well. With only a few days remaining in 2023, let's review the significant developments in the fintech industry this year:

1. Online Loans

This year, the RBI took a significant step by approving the rules pertaining to the "First Loss Default Guarantee (FLDG)". In the future, this should encourage digital financing. Following the June meeting of the Monetary Policy Committee, Reserve Bank Governor Shaktikanta Das had said that the default loss guarantee arrangement in digital lending would be authorized following consultation with all relevant parties and a careful consideration of calculated risk in relation to innovation. has been provided.

2. International UPI Transactions

NPCI International Payments Limited (NPIL) has collaborated with payment systems of several non-Indian nations to allow Indian residents to make UPI payments overseas. This covers Nepal, Bhutan, Mauritius, Singapore, and the United Arab Emirates. Indians residing in these nations may transfer money to India instantly with its assistance. Simultaneously, Indian students and other residents, together with their parents or relatives residing in India, would have easy access to money transfers. It is anticipated that cross-border UPI payments would drastically lower the cost of international money transfers.

3. Digital Currency Issued by Central Banks

Known as the "e-Rupee," the RBI has introduced its own Central Bank Digital Currency (CBDC). On December 1, 2022, nevertheless, it was initially introduced as a trial experiment. By doing this, the RBI has become one of the few central banks globally to issue digital money. Banks will handle the e-Rupee distribution process. It will be accessible to regular people via their digital wallets and smart phones. It may only be transferred via digital wallet to another individual or company.

4. Fintech Cross-Border Transaction Guidelines

In 2023, the central bank released guidelines governing payment aggregators' cross-border operations. This would control cross-border payment transactions pertaining to the import and export of goods and services. In order to include all organizations engaged in facilitating cross-border payments, the RBI created a new category in its circular named Payment Aggregator-Cross Border (PA-CB). In order to preserve the integrity and stability of the nation's financial system, the RBI has taken this action.

5. Fintech regulatory framework

Currently, RBI is working hard to create a fintech repository that will be made available in April 2024. Governor of the Reserve Bank of India Shaktikanta Das said that fintechs are being encouraged to provide all required data independently to this repository. RBI Deputy Governor M Rajeshwar Rao said on November 23 that in order to encourage innovation in the fintech sector, it is essential to constantly work on redefining the laws and regulatory environment.