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Informist, Thursday, Nov. 7, 2024

 

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--RBI Sankar on unified lending interface: Once launched, will be open for all
--RBI Sankar on e-rupee: Matter of time till the tech takes off
--RBI Sankar:Important to weigh impact of e-rupee on other fincl instruments
--RBI Sankar: Have to weigh how e-rupee aids deposit mobilisation
--RBI Sankar: Quite happy to go slow on e-rupee
--RBI Sankar: Self regulation best for non-fincl fintechs
--RBI Sankar: Will regulate fintechs as long as they are part of fincl system
--RBI Sankar: Possible to leverage digital tech, AI to reduce frauds
--RBI Sankar: Have to be cautious, very alert with fincl tech
--RBI Sankar: Don't see currency circulation going down
--RBI Sankar: In talks with large economies to use UPI
 

 

MUMBAI – The Reserve Bank of India is in talks with advanced economies on the use of unified payments interface, RBI Deputy Governor T. Rabi Sankar said at the Business Standard BFSI Summit on Thursday.

 

RBI and NPCI International Payments plan to extend the unified payments interface to 20 countries by 2028-29 (Apr-Mar), the central bank said in its annual report. As per the data by the National Payments Corp of India, September saw 15.04 billion unified payment interface transactions amounting to INR 20.64 trillion.

 

 

Sankar said that even though there has been an increase in the usage of unified payment interface, the currency in circulation has not gone down. "We are not seeing the currency in circulation go down, notwithstanding a substantial increase in the rate of UPI and others," Sankar said. As of Nov. 1, the currency in circulation stood at INR 35.62 trillion. 

 

On the usage of artificial intelligence, Sankar said that innovation is a must but have to be very cautious about it. He said that the number of retail frauds is rising and that digital technology and artificial intelligence can be used to reduce the number of frauds.

 

Sankar also said that the financial technology companies which deal with funds, automatically come under the RBI's regulatory landscape. "As long as there is movement of funds, it will be regulated. Whether the regulator is RBI, SEBI, IRDAI or PFRDA or someone else is a matter of detail," he said. "Those fintechs which are not handling funds and are purely technology-based, there our approach has been straight forward, we don't want to directly regulate them."

 

He reiterated that self-regulation is the best way to go for financial technology companies which do not deal with funds. In August, RBI approved Fintech Association for Consumer Empowerment, or FACE, as the first fintech self-regulatory body.

 

Sankar said that the Reserve Bank of India is not in a hurry to release the digital currency as there are a lot of factors to consider before rolling it out. "There is no doubt in my mind whatsoever that it is a matter of time this technology is going to take off in the field. But, we have to be very careful because we need to understand how it will affect the current financial system, how it will affect deposit mobilisation by the bank, and credit creation in the system," he said.

 

On the unified lending interface, which is a digital public infrastructure, Sankar said, "Once we have the ULI (unified lending infrastructure) system in place, it is open to everyone and, in fact, some in the private sector already have products that can be used. It's open to everyone to innovate on the system."  End

 

Reported by Kshipra Petkar

Edited by Akul Nishant Akhoury

 

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