{"id":27657,"date":"2020-01-04T14:04:14","date_gmt":"2020-01-04T08:34:14","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=27657"},"modified":"2020-01-04T14:04:17","modified_gmt":"2020-01-04T08:34:17","slug":"steps-taken-by-rbi-to-develop-fintech","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/steps-taken-by-rbi-to-develop-fintech\/","title":{"rendered":"Steps Taken by RBI to Develop Fintech"},"content":{"rendered":"

With the rapid change in technology and customer expectations, the regulatory authorities are constantly taking steps to recognize the changes that are taking place. To look into the matters on the important aspects of Fintech and its implications, RBI<\/a> has set up an inter-regulatory Working group<\/strong> to review the regulatory framework and to look into the dynamics of the increasing growth of the Fintech scenario.<\/p>\n\n\n\n

Further, for live testing of innovative products in\nthe areas of retail payment and wealth management, <\/strong>RBI has permitted the\ninstitutions and banks to set up Regulatory\nSandbox<\/strong>. i.e. reviewing the new products or services in a regulatory\nenvironment for which regulatory authority may \/or may not permit certain\nrelaxations. To collect evidence on the benefits and risks of new financial\ninnovations, the Regulatory Sandbox permits the regulatory authorities, financial\nservice providers and customers to conduct field tests, while carefully\nmonitoring and considering their risks.<\/p>\n\n\n\n

Major steps were taken by the RBI to develop Fintech<\/h2>\n\n\n\n

For developing the Fintech in the Indian Market<\/a>, RBI has introduced the “Unified Payment Interface”<\/strong> in collaboration with NPCL (National Payments Corporation of India)<\/strong>. NPCL was structured with guidance from RBI and IBA (Indian Banking Association). The introduction of UPI played an impulse role in the Fintech penetration and financial inclusion in the country.<\/p>\n\n\n\n

What\nis UPI?<\/h2>\n\n\n\n

The Unified\nPayment Interface facilitates the user to access their bank account through an\napplication on their smartphone or any other smart device. The UPI enables the\nseamless transaction of digital payments in India using a single channel of\nauthorization for both banks and consumers. <\/p>\n\n\n\n

The volume of UPI transactions has increased at a CAGR of 246 percent during the period from 2016-17 to 2018-19.<\/strong><\/div>\n\n\n\n

Also, Read:<\/b> Fintech is shaping the future of Banks\n<\/a><\/mark>.<\/p><\/div>\n\n\n\n

What\nis NPCL?<\/h2>\n\n\n\n

An initiative\nis taken by Reserve Bank of India (RBI) and Indian Banks’ Association\n(IBA) for operating retail payments and settlement systems in India, under\nthe provisions of the Payment and Settlement Systems Act, 2007 termed as\nNational Payments Corporation of India (NPCI)with the main motive of creating a\nrobust Payment & Settlement Infrastructure in India.<\/p>\n\n\n\n

NPCI has been incorporated as a not-for-profit company under the provisions of Section 8 of Companies Act 2013, NPCI has been set up with the intention-<\/p>\n\n\n\n