Finance Minister Nirmala Sitharaman´s Union Budget for 2022 has proposed several steps for a more digitally financial India, with a push towards a cashless economy and financial inclusion. The Budget has been praised for its potential for blockchain adoption as fintech takes priority through the digital Rupee.
HIGHLIGHTS
- Digital banking by post offices
- Digital payments: Scheduled commercial banks to set up 75
- Digital banking units in 75 districts
- Introduction of digital Rupee by RBI starting 2022-23
- Income from digital asset transfers to be taxed at 30% giving it a legal status in India
The Tech Panda gathered the reactions, both positive and negative, of several experts to find out if FinTech expectations were met in the budget.
Read more: Budget 2022 reaction: Crypto community welcomes legal status of digital assets
Milan Ganatra, Founder & CEO, 1SilverBullet
Opening various things at the Indian Financial System Code (IFSC) will allow it to become a worldwide financial services centre, fuelling a slew of Fintech-related operations
“Opening various things at the Indian Financial System Code (IFSC) will allow it to become a worldwide financial services centre, fuelling a slew of Fintech-related operations. The government has been extremely pro-infrastructure, and they have granted industry data centres status, which is a great move with multiple benefits. Overall, the government has recognised the importance of technology, startups and has assured that there will be adequate and more entrepreneurial opportunities, which will be backed up by government assistance.”
Tanul Mishra, CEO, Afthonia Lab
From the fintech industry standpoint this is certain to drive more innovation and add a fillip to the already burgeoning partnerships between legacy financial institutions and new age fintech innovators
“It is encouraging to see the progressive thinking shown during the budget announcement for 2022. The introduction of the digital rupee using blockchain is a move in the right direction for ensuring financial inclusion, encouraging transparency, and enabling ease of trade. Even the announcement to set up 75 digital banking units is a step forward in this effort to bring all of India into the digital finance fold.
“From the fintech industry standpoint this is certain to drive more innovation and add a fillip to the already burgeoning partnerships between legacy financial institutions and new age fintech innovators. Both these initiatives are a great harbinger of the times to come for us as an industry and as a nation that is working on the vision of a digital future.
“Additionally, the announcements extending the existing tax benefits for startups by 1 more year is likely to help concept stage and early-stage startups ease up on the pressure to deliver results and instead focus on refining their product/service to find the perfect market fit.”
Saumya Shah, CEO, Tarrakki
It would have been especially heartening to see a more pronounced view on the encouragement of investments for individual and non-individual investors as the Indian economy gears up for a steep growth phase, however, we are confident that the flurry of digital transaction activity and the rebates offered are likely to create a more positive environment for wealth creation and financial inclusion
“The announcement around the digital rupee and the digital banks in 75 districts is certainly good news for the fintech industry at large and encouraging for innovators like us. We at Tarrakki are geared to drive digital infrastructure within traditional financial industry frameworks to encourage investments and drive a culture of creating wealth.
“This is certainly in line with the FM’s budget 2022 promise of being inclusive and futuristic. It would have been especially heartening to see a more pronounced view on the encouragement of investments for individual and non-individual investors as the Indian economy gears up for a steep growth phase, however, we are confident that the flurry of digital transaction activity and the rebates offered are likely to create a more positive environment for wealth creation and financial inclusion.”
Dr. Navneet Gupta, Founder & CEO, YPay
All the efforts will strengthen credit access, and payments in the MSME system will certainly reflect in the nation’s economic growth at large
“India’s fintech system was a silver lining in the difficult times of lockdown and the pandemic. The nation has been bullish with digital payments, and the current budget has further fuelled the same by announcing 75 digital banking units in 75 districts. Inclusion of 1.5 lakh post offices under banking system with digital infrastructure enablement will promote financial inclusion and accelerate shifting micro economy in the mainstream banking system. Gradually, all the efforts will strengthen credit access, and payments in the MSME system will certainly reflect in the nation’s economic growth at large.”
Mitesh Thakker, CEO & Founder, MissCallPay
This renewed focus in Budget to the marginal sections, will get channelled in the right direction and rapidly increase the users on UPI and thus bolster the growth of our economy in the coming year, real aacche din for Bharat seems to have arrived at the door
“This 2022 Budget is a real booster budget, as it is focused on vulnerable sections to increase adoption of technology and digital payments in Bharat. Firstly due to the announcement of 75 Digital Banking Units (DBUs) in 75 districts.. a unique initiative and digitization of 1.5 lakh post offices to provide core banking to the nook and corner of Bharat. Secondly, there is mention of a focus to promote the use of payment platforms that are economical and user friendly.
“It seems government has heard my prayers to bring some reforms for feature phone and voice based payments as there are 97.3 crore mobile subscribers who are still not on UPI, while top UPI apps like GooglePay, PhonePe, PayTM, AmazonPay, Govt’s own BHIM as well as app of other 55 banks have only been able to enrol 20 crore users on UPI and most of these users are from the lower middle-income segment non-tech savvy, from villages and elderly who struggle to make cost-free zero MDR money transfers, while we zip through addictive UPI based apps.. that ease of UPI has led to big increase in UPI payments, but UPI user-base has kind of hit the glass ceiling at 20 crore (200 million).
“This renewed focus in Budget to the marginal sections, will get channelled in the right direction and rapidly increase the users on UPI and thus bolster the growth of our economy in the coming year, real aacche din for Bharat seems to have arrived at the door.”
Vineet Tyagi, Global CTO, Biz2X
The use of technology in every important project is the key highlight of this year’s budget and an epitome of Naya Bharat
“The government’s aim to spread digital banking services to remote areas in India is a welcoming move. The Finance Minister proposes the inclusion of Post Offices in the core banking system customers. With this, Post Office account holders will be able to make online transactions and even transfer money to other bank accounts through net banking. This will be beneficial especially for farmers, senior citizens, and SMEs in rural areas, enabling interoperability, and financial inclusion.
“Acknowledging digital rupee is a great acknowledgement by Government and is a massive digital boost. It will promote fintech and technology-based development which is a much needed push. The use of technology in every important project is the key highlight of this year’s budget and an epitome of Naya Bharat.”
Poshak Agrawal, Co-founder & CEO, Florence Capital
We hope to be able to support this mission and vision of financial inclusion by providing secured, transparent and accessible credit to women. Financial inclusion will play a key role in ensuring that the goal of 9.2% economic growth is achieved
“We welcome the vision outlined in the Union Budget 2022 regarding digital payments and how it can be a key tool towards enabling financial inclusion. The Budget has acknowledged that taking forward the digital banking and fintech innovations is the way to go – it is proposed to set up 75 digital banking units in 75 districts of the country by scheduled commercial banks. We hope to be able to support this mission and vision of financial inclusion by providing secured, transparent and accessible credit to women. Financial inclusion will play a key role in ensuring that the goal of 9.2% economic growth is achieved.”
Ankit Poddar, Director, Candle Partners
The additional digital banks in 75 districts is a step in the right direction and we hope to see that accelerate in the years to come to drive true financial inclusion
“Budget recognizes the impact of digital currencies and to some extent formalized it through announcement of release of digital currency by RBI and taxation of digital assets. The additional digital banks in 75 districts is a step in the right direction and we hope to see that accelerate in the years to come to drive true financial inclusion.”
