An analysis of whether India really needs a central bank digital currency. The United States wants to ‘get it right than to be first’. That’s what Jerome Powell, US Federal Reserve’s chairman said about the digital Dollar two years ago. The United States still doesn’t have a central bank-backed digital currency (CBDC). Meanwhile in India, RBI just piloted the digital RupeeRead more
Blog
A dissection of why credit card payments through UPI may not be as convenient, accepted, and trusted. RBI has proposed linking credit cards (CC) to UPI. It’ll, to start with, allow Rupay credit card payments through UPI rails. And in the due course, allow other CC issuers to come on board. Credit on UPI has beenRead more
An analysis of RBI’s card directions that restrict fintech’s access to card transaction data and their interplay with RBI’s outsourcing guidelines. In April 2022, RBI notified the directions on Credit and Debit Cards. In these directions, it asked co-branding partners to keep their hands off card transaction data. The RBI has, this time, gone straight for the fintechRead more
The best stories of 2022 from our monthly fintech newsletter, FinTales. February 2022: The Hassleocracy of Crypto-taxes “Cryptos have no underlying assets, not even a tulip.” –Shaktikanta Das Ouch. That’s the RBI Governor, not mincing his words. Like everyone else, we’ve pored over the Budget announcements on crypto-assets. The euphoria in the crypto-verse was short-lived.Read more
In this article, we take a road-trip to understand the RBI digital lending guidelines’ requirements relating to fund flow and pass-through accounts. And explore two key issues: where can money go to and where can money go through? Pass-through accounts are common in digital lending arrangements. Buy-now-pay-later (BNPL) products typically involve five parties: (1) aRead more
This article analyzes the Delhi High Court’s judgement upholding the RBI’s Guidelines for Payment Aggregators. And contrasts it with previous judgements like the crypto banking ban case where courts have disagreed with the RBI. The Delhi High Court has upheld the constitutionality of the RBI’s Guidelines for Payment Aggregators (PA Guidelines) in a judgement released last month (PA RegulationRead more
This article discusses the impact of and alternatives to the zero MDR policy in the context of the RBI discussion paper on payment charges. In August 2022, the RBI released a discussion paper on payment charges. For fintech players, the paper’s observations about UPI are particularly relevant. The RBI has sought public comments on whether charges shouldRead more
This article walks-through the impact of the RBI’s digital lending guidelines on users and fintech businesses. “In a diverse market like India, key is to match right-priced borrower risk to investor/lender risk” -Fintech Founder (State of India Fintech Union 2022) Matchmaking. That’s what Indian fintech does best. Matching the right borrower with the right lender.Read more
The RBI wants digital lenders to follow ethical AI standards. But what does this mean in practice? In this article, we explore how digital lenders can adopt ethical AI standards before hardline regulation causes business disruption. “In our early days at Upstart, we couldn’t know for certain whether our model would be biased. It wasn’tRead more
This post discusses RBI’s scale based regulatory framework for NBFCs. It explains the reasons behind RBI’s new approach and its impact on the fintech ecosystem. In October 2021, RBI notified scale-based regulations for NBFCs (which will kick-in on 1 October 2022). With these regulations, RBI aims to increase transparency (in NBFC operations) through greater disclosuresRead more