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2024 Budget: FinTech’s Vision Embracing Inclusion, Protection, and Innovation.

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TLDR: India’s fintech sector expects the upcoming budget to focus on financial inclusion, consumer protection, and digital advancement. The industry is optimistic about the government’s commitment to stimulating sectoral growth and enhancing India’s digital presence. Key expectations include incentivizing fintechs dedicated to empowering underprivileged SMEs, introducing measures to increase credit penetration in tier-2 and tier-3 markets, and simplifying financial service regulations to encourage collaboration between traditional lenders and fintechs. It is crucial for the government to strike a balance between encouraging innovation and safeguarding consumer interests.

India’s fintech sector has seen significant growth, with nearly half of the startups founded between 2016 and 2021 belonging to the fintech sector. The sector is projected to outpace traditional banking routes by 2030. The upcoming budget presents an opportunity to catalyze sustainable growth for fintech in the Indian economy.

Expectations for the budget include:

  • Incentivizing fintechs dedicated to empowering underprivileged SMEs through financial and technical support
  • Maintaining the profitability of state-owned banks and enhancing credit guarantee schemes for MSMEs
  • Introducing Production-Linked Incentive (PLI) schemes and augmenting subsidies for small businesses
  • Introduction of financial inclusion measures to increase credit penetration in tier-2 and tier-3 markets
  • Simplifying and clarifying financial service regulations to encourage collaboration between traditional lenders and fintechs
  • Emphasis on digitalization to further enhance India’s digital presence

A nuanced approach to regulation and policymaking, striking a balance between fueling innovation and safeguarding consumer interests, is crucial for the sector’s growth. The budget provides an opportunity for the government to encourage innovation, ensure consumer protection, and bolster digital infrastructure for sustained economic growth.

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