Fintech should work together with banks to develop compliant solutions

New Delhi: Financial Services Secretary Vivek Joshi on Wednesday urged the fintech community to work in close coordination with banks so that scalable and regulatory compliant solutions can be designed.

Addressing FICCI-IBA PICUP Fintech Conference, Joshi said the fintech sector is growing very fast and India has the highest fintech adoption rate vis-à-vis global average. Observing that fintech has transformed the financial sector architecture by providing innovative solutions to various services, he said, "I would urge fintechs to work hand in hand with banks, rather than creating a solution themselves and then approaching banks...because banks especially public sector banks deal with the very large, bigger issues."

It would be more appropriate that the bank suggests the problem, and then a solution is provided by the fintech ecosystem, he said. "Since you (fintechs) are not working hand in hand with banks, a lot of information about the kind of challenges the banking system is facing may be limited...so, that would be the direction we should be working towards. Many of the banks have started empanelling startups.

Therefore, the idea is to give them the problems and then ask for a solution that would be very great," he said. While the potential of fintech is immense, Joshi said there are challenges that come with growing use of technology. "Digital growth has thrown certain unique challenges such as governance issues, regulatory and statutory compliances, consumer protection and fair practices.