Fintech Associations : Fintech associations are exploring various incentives to incentivize companies to join self-regulatory organizations (SROs), including offering mentorship for fintech startups and promoting capacity-building initiatives.
Recently, the Reserve Bank of India (RBI) introduced a framework for a self-regulatory organization tailored for fintech firms. The proposed framework aims to establish industry standards, oversee and enforce regulations, handle grievances, and resolve disputes. Leading digital lending associations are addressing the challenge of boosting membership by providing an array of resources.
Fintech Associations Propose companies to join SRO framework
Jatinder Handoo, CEO of the Digital Lenders Association of India, highlighted major incentives for companies to join an SRO-FT, including bolstering their reputation, offering mentorship for startups, facilitating capacity building, providing access to resources such as innovation offices, offering clarity on regulatory requirements interpretation, conducting training programs through events and webinars, offering legal assistance, and enabling participation in a unified sectoral voice across various platforms. The RBI emphasized the importance of creating membership incentives for SRO-FTs, considering that fintech entities currently operate outside direct regulatory oversight.
Sugandh Saxena, CEO of the Fintech Association for Consumer Empowerment (FACE), emphasized the need for solidarity among fintechs to navigate the rapidly evolving ecosystem. Saxena stressed the importance of industry dialogues and unified actions, asserting that only as a collective can fintechs effectively shape the sector by pooling resources, establishing standards, and achieving better outcomes.
The RBI has clarified that membership in SRO-FTs (Fintech Associations) will remain voluntary. To encourage participation, external stakeholders such as investors and rating agencies will play a role in persuading companies to join the SRO framework. Handoo explained that these stakeholders will contribute to fostering voluntary membership within the SRO framework.
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