India has witnessed a boom in fin-tech start-ups in the recent years especially amid demonetization and with the introduction of UPI platforms. Even though the country boasts of over 2000 fin-tech start-ups today, globally, it does not come up as a hub. Whether it is in terms of quality of innovation or marketing, it still lags far behind. While various states have been competing with each other to emerge as the frontrunner in the game, what is more crucial is providing the right opportunity and support for companies all across the country regardless of where they are located.
With that said, the recent move by RBI to set up an innovation hub for the financial sector has come off as a relief. The move is expected to facilitate innovation across the sector by leveraging technology. The goal is to create an ecosystem that would promote financial inclusion and increase accessibility to financial services and products.
While Mumbai is often touted as the financial capital of India, it is Bengaluru from where the fin-tech revolution began. However, the fin-tech sector cannot bloom in isolation in one state alone; an inclusive solution was the need of the hour and this is what RBI has sought to do. Moreover, even though the sector has grown tremendously over the years, one of the underlying challenges has been the huge talent gap. Thus, keeping education as a focus vertical, RBI has collaborated with financial sector institutions, technology industry and academic institutions to foster the exchange of knowledge and ideas in the development of prototypes pertaining to financial innovations.
Taking its effort up a notch, RBI has also selected entities for the first cohort under the regulatory sandbox structure. With retail payments as its theme, two of six selected entities have already started testing their products while the remaining four are expected to start their testing soon in the coming time.