Disruptors for Fintech vis-à-vis changing Regulatory requirements
Fintech has been facing various challenges ever since its emergence in India. According to a report in Economic Times on 21st January 2019, the disruptors (rules/laws regulating Fintech/Digital Payments) have been challenging Fintech in various ways.
Fintech was recently confronted by Supreme court’s verdict on September 27, 2018 which mentioned withdrawal of Adhaar as a mandatory identity proof for e-KYC.
Mr. Rajesh Desai, CEO of Lyra Network, India also gave his opinions back then regarding various factors that emerged out of the verdict and may reflect in the future endeavours of the company.
It was revealed by Mr. Rajesh that the organization was going to face certain difficulties while authenticating the merchants/clients.
Also, the probabilities of operational efficiency became a more daunting task as the operational cost and time went up with the inclusion of other types of authentication documents from the customer’s end.
Nevertheless, this verdict was abides by and respected and operations were carried out in accordance with the same.
The efficiency, undoubtedly, needed special consideration as the fact remained the same and the company affected the required changes promptly in all the aspects.
On one hand, India, as a nation, puts emphasis on start-ups to emerge and prosper as much as possible; on the other hand, it also needs to ensure its citizens about keeping their right to privacy intact at all times possible.
Consequently, this was a challenging situation also for the country and the law alike.
The article in Economic Times also mentioned about the rules on local storage of payments data as another disruptor for Fintech.
On the rule for storing payments data, a six-month period was given to firms to comply with the directive and a deadline of Oct 15, 2018 was set.
This directive needed digital payments’ companies to begin storing payments data in India.
According to Bloomberg Quint, the RBI first drew attention to the issue of local storage of payments data in April,2018 when it noted that only a few firms are storing such data in India.
Local storage and access to such data, the RBI said, was essential for supervisory purposes.
It went on to say, “All system providers shall ensure that the entire data relating to payment systems operated by them are stored in a system only in India.”
Regulatory uncertainty on some services in the digital payments’ sector is yet another disruptor that is a blow on Fintech’s operations. For an even extended success of digital payments’ industry, there is an urge to form a separate regulator for the same.
This step is the need of the hour and an independent and separate regulatory authority to regulate the digital payment system in India is sure to provide the necessary relief to the Fintech.
Fintech has been treading with pace over the years successfully and has been abiding by every regulation it has been confronted with.
How has Lyra maintained sustainability in the market with all the challenges?
Lyra, as a fintech, has abides by every regulation so far and has maintained sustainability in the market.
To maintain sustainability in the market, it is best to stick to the tips and strategies that have always helped the company in the challenging atmosphere.
Moving forward with the tactics that have always made the way clear and successful needs to always be the forte, according to Mr. Rajesh Desai, CEO, Lyra India.
Secondly, adaptation to the local regulations is another crucial and challenging task yet a requisite.
Taking care of the consumer accessibility is another quirky tip that could extend the company a longevity and help it to make its roots stronger in the industry for a profitable time in its future prospects.
Another one can be looking into the consumer satiety promptly and as swiftly as is possible in lieu of any changes.
This can be achieved with time-to-time advancements in and/or with respect to the services rendered to the consumers so that the consumer base does not suffer because of inability in terms of being prepared with the imperative changes in the system.
Developing the client specific services and reflecting the changes in the same need to be the strength of a company apart from all other requisites.