FM Nirmala Sitharaman Advocates Regulatory Support to Foster Fintech Growth

In response to recent regulatory actions against Paytm Payments Bank, Finance Minister Nirmala Sitharaman has underlined the importance of distinguishing individual startup issues from broader sectoral challenges. Addressing an event organized by The Indian Express, she expressed the government’s commitment to extending assistance to startups, particularly within the fintech ecosystem.

Sitharaman affirmed her empathy for the sector, emphasizing that the problems faced by a few startups should not be generalized to the entire startup ecosystem. She assured that the government aims to simplify compliances and make them more user-friendly to foster a conducive environment for innovation.

“At the meeting held on February 26 with fintech founders, we had a fantastic conversation. Each startup voiced their concerns, mainly centered around seeking support from regulators and regular clarifications, rather than being directly linked to Paytm’s issues,” said Sitharaman.

The meeting, attended by approximately 40 fintech entrepreneurs and non-fintech founders, saw participation from senior officials, including a Reserve Bank of India (RBI) deputy governor and representatives from various departments and ministries such as finance, DPIIT, and MeitY. Prominent figures from the fintech space, including Amrish Rau of Pine Labs, Kunal Shah of CRED, Jitendra Gupta of Jupiter, and Yashish Dahiya of Policybazaar, were present. Heads of leading banks and representatives from companies like PhonePe, Google Pay, Razorpay, and NPCI also participated.

Despite facing funding challenges, the fintech sector in India remains robust. Inc42 data reveals that between 2014 and 2023, 726 Indian fintech startups collectively raised over $28 billion. Notably, in the previous year, four fintech companies—PhonePe, DMIFinance, Perfios, and InsuranceDekho—each secured funding exceeding $100 million.

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