Spice Money: Industry Monitoring 26 April 2019
- Priyanka Kanodia
- Apr 30, 2019
- 2 min read
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Prevent abuse by dominant fintech: Bank of International Settlements
Publication- The Economic Times
Edition- Online
Date- 26 April, 2019
Leveraging technology can go a long way in financial inclusion, but Indian regulators should take a page from fintech evolution in various global markets to prevent monopolisation of the fintech industry and propriety control of consumer data, said a top executive from Bank of International Settlement (BIS) here on Thursday. Taking the examples of payment companies Tencent and Alipay in China, and online marketplace major Mercado Libre in Argentina, Agustín Carstens, general manager, BIS pointed out that while technology can bring down cost barriers for financial inclusion but market concentration and single source data proliferation “can work in opposite directions.” Carstens pointed out that regulators must play a huge role in ensuring policy framework to support new age fintech players to compete with the incumbents to build rival networks and protect consumer rights.
“For financial innovation to promote financial inclusion further, its potential adverse effects must be addressed. Policymakers can play a vital role here by upgrading or providing new infrastructure, both hard and soft,” Carstens, who was also the former governor of Mexican central bank, said at the CD. Deshmukh memorial lecture at the Reserve Bank of India. Taking the example of National Payments Corporation of India (NPCI) developed UPI technology, Carstens said that technologies which work on interoperability of market players and reduce transaction cost, while also levelling the playing field, is desirable. “…this facility (UPI) allows both domestic and global players to develop mobile payment applications. As such, it lowers the barriers to entry, especially for smaller firms, thus levelling the playing field,he said.
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RBI panel for making all public payments digital
Publication- Business Standard
Edition- Online
Date- 26 April, 2019
India’s Aadhaar is a huge asset, according to renowned economist Agustín Carstens (pictured), who also praised the Unified Payments Interface (UPI), which has lowered entry barrier for smaller firms, thus levelling the playing field. Carstens, who is general manager of the Bank for International Settlements (BIS), is former finance minister of Mexico and former governor of its central bank. Carstens lost out to Christine Lagarde, who was French finance minister, for the post of managing director of the International Monetary Fund (IMF). Carstens, considered one of the most influential voices in economics, came to the Reserve Bank of India (RBI) to deliver the 17th C D Deshmukh Memorial Lecture on Thursday.
The lecture, focused on financial inclusion, said protecting the stability of the financial system encouraged financial inclusion, but globally the central banks should do more, such as embracing technology, while safeguarding the users’ interests against the flipside of technology. India, in this context, has done pretty well, according to Carstens. He praised the Pradhan Mantri Jan-Dhan Yojana for introducing households to basic transaction accounts, while companies such as Paytm expanded the scope of banking through digital offer.
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