BUSINESS
Fintech companies involved in cryptocurrency services will not be able to join Fintech Association for Consumer Empowerment (FACE), the country’s first self-regulatory organisation (SRO) for the sector. The SRO has decided to exclude fintechs offering cryptocurrency -related services from its membership, FACE CEO Sugandh Saxena told FE. More than 900 fintech firms are engaged in providing services related to cryptocurrencies, as per industry estimates. The newly-recognised body has launched a drive to add new members. “We have reached out to around 1,000 players. We are excluding crypto as we are only looking at fintechs in the regulated space,” said Saxena. FACE’s decision has come amid concerns raised by the RBI about the high-risk digital asset. The RBI governor has repeatedly cautioned that cryptocurrencies have huge inherent risks which could pose threat to the country’s macroeconomic and financial stability. FACE is the first industry association to be recognised as a self-regulatory organisation in the fintech sector (SRO-FT) by the Reserve Bank of India (RBI). The SRO is trying to gauge the scale of the fintech industry, including the number of active and closed businesses. “We are approaching membership in a systemic way, carefully studying fintechs through research and interactions to understand their functions, growth stage, challenges and expectations from the SRO,” Saxena said. “This exercise will also help us gather granular and meaning information on different categories of the fintech domain.” Loans disbursed by digital lenders rose by 27% to Rs 37,676 crore in the first quarter of the current fiscal, a FACE report said. “Earlier, we functioned as an SRO on our own, though limited to the lending space. Now, we have a larger mandate to cover all fintechs, so we are making that transition,” said Saxena. “We already have more than 25% of non-lending fintechs as members, and their share will increase significantly in the coming months.” Once the SRO has a critical mass in different fintech categories, it will have dedicated working groups and forums of members to drive programmes to meet their unique needs. “Privacy and security of customer data, transparency and cybersecurity and supporting members’ compliance with regulations and laws in the right spirit are paramount,” she said. “As an SRO, we want to ensure our members have access to the necessary information, capacity and tools to comply with the regulatory framework,” Saxena said. None
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