CUBE: Your Insight into the Fintech Ecosystem

Hello from FACE, an RBI-recognized Self-Regulatory Organization in the FinTech Sector (SRO-FT). We present the tenth edition of Cube, a go-to source for the latest and relevant happenings in the fintech sector in India and beyond. Got thoughts or ideas? We’d love to hear from you at teamface@faceofindia.org.?

Rulemaking

• RBI released Framework for imposing monetary penalty and compounding of offences under the Payment and Settlement Systems Act, 2007.
• RBI announced completion of the test phase of the “Regulatory Sandbox: On Tap application on theme Retail Payments.”
• RBI released FAQs on the circular on 'Reset of Floating Interest Rate on Equated Monthly Instalments (EMI) based Personal Loans.'
• RBI issued Master Direction – Reserve Bank of India (Credit Information Reporting) Directions, 2025.
• GoI released The Economic Survey 2024-25.
• released a consultation paper on “promoting financial inclusion through sachetisation of investment in mutual fund scheme” for feedback by 6 Feb 2025.
• MeitY released a notification that Aadhaar Authentication is expanded to government and private entities for providing various services in the public interest boosting innovation, knowledge, and public service enhancement.
• MeitY released Digital Personal Data Protection rules 2025 for feedback. The feedback shall be submitted on or before 18 Feb 2024.
• MeitY announced Entity Locker: A Digital Public Infrastructure for streamlined business document management.
• MeitY organized a consultation on draft DPDP rules 2025 on 14 Jan 2025.
• MeitY published a report on AI Governance Guidelines Development for public consultation. The feedback is to be submitted by 27 Feb 2025.?
• NeGD, MeitY held a consultation meeting to on-board API Service Providers for National Data Highway (API Setu).
• BIS released a working draft on “E-Commerce- Principles and Guidelines For Self-Governance” for feedback by 20 February 2025.
• IRDAI published regulatory sandbox regulations 2025.
• IRDAI published Maintenance of Information by the Regulated Entities and Sharing of Information by the Authority regulations 2025.
• Government approves Mutual Credit Guarantee Scheme to Strengthen MSME Manufacturing Sector, fulfilling the budget announcement of 2024-25.
• GST council issued a circular on the subject Regularizing payment of GST on co-insurance premium apportioned by the lead insurer to the co-insurer and on ceding /re-insurance commission deducted from the reinsurance premium paid by the insurer to the reinsurer.
• GST council issued a circular Clarifications regarding applicability of GST on certain services.

Must-Reads

FinTech and Banking

• Cambridge Centre for Alternative Finance (CCAF) released a report “MSME access to digital finance.”?
• Internet and Mobile Association of India (IAMAI) and Kantar published a report “Internet in India 2024.”
• Money 2020 published a report “Future of Fintech in APAC.”
• Consumer Financial Protection Bureau (CFPB) publishes report titled “Consumer Use of Buy Now, Pay Later and Other Unsecured Debt.”
• Alliance for Financial Inclusion (AFI) and SME Finance jointly published report “Alternative Data for Credit Scoring.”
• International Monetary Fund released a working paper titled “Does fintech increase bank risk taking?”
• The commonwealth organization released a report titled “Commonwealth countries driving fintech innovation.”
• MeitY and Indian Council For Research On International Economic Relations (ICRIER) published a research report titled “Estimation and Measurement Of India’s Digital Economy.”
• Sensor tower released report titled “State of Mobile Finance Apps 2024 Report.”
• PWC published a report titled “Viksit banking – A roadmap for the Indian banking sector for 2047.”

Cyber security & Privacy

• Google published Threat horizons report that provides decision-makers with strategic intelligence about threats to cloud enterprise users.
• Cyber-security market may reach a $2 trillion opportunity.
• UK finance published a report on opportunities and risk management in financial services.
• Financial Conduct Authority released the report Assessing and reducing the risk of Money Laundering Through the Markets (MLTM).”
• BIS released working paper on Privacy-enhancing technologies for digital payments: mapping the landscape.”

Digital Payments

• RBI publishes Payment System Report, Dec 2024.
• RBI published digital payments index for Sep 2024.
• Hyperledger foundation publishes the ebook on central bank digital currencies.

Artificial Intelligence, DPI, and new technologies?

• BIS released a report “Governance of AI adoption in Central Banks.”
• AFI released a report on “Policy Development and Implementation Guide for Inclusive Open Finance.”
• World Economic Forum published a whitepaper on AI in financial services.
• The Organisation for Economic Co-operation and Development (OECD) released a policy paper on “Tokenisation of assets and distributed ledger technologies in financial market.”
• UNESCO in collaboration with the MeitY, IndiaAI Mission, and Ikigai Law as the implementing partner, hosted a two-day consultation on AI Readiness Assessment Methodology (RAM) on 16 and 17 January in India. The consultation aims to craft an India-specific AI policy report that identifies strengths and opportunities for growth within India’s thriving AI ecosystem.
• European Banking Authority (EBA) and European Securities and Markets Authority (ESMA) published a Joint Report on recent developments in crypto-assets, analysing decentralised finance (DeFi) and crypto lending, borrowing and staking.

The World Around

• Australian Securities and Investments Commission (ASIC) alerts buy now pay later providers to apply for a licence under new laws.
• The Public Sector Fraud Authority of the United Kingdom published guidance for Enterprise Fraud Risk Assessment (EFRA).
• President Trump issued an executive order setting out measures to strengthen American leadership in digital assets and digital financial technology.

FACE Forward

• FACE updated advisory on the credit bureau to reflect fortnightly submission of data to CICs kicks off on 1 Jan 2025.
• FACE released Guidance on Pricing.
• FACE published FinTech Personal Loans Apr 2018- Sep 2024 reports.
• FACE organized multiple webinars in Jan 2025 to ensure exchange of information amongst the FinTech industry:

- Webinar with KPMG on taxation issues for FACE members.

- Session with GT Bharat on RBI Notification on?Prevention of financial frauds perpetrated using voice calls and SMS – Regulatory prescriptions and Institutional Safeguards.

- Webinar with industry experts on draft BULA.

- Compliance Q&A session on RBI regulations relevant to digital lending.

• FACE launched two new forums, RegTech and MSME to collaborate on specific issues relevant to companies working in this space.
• FACE launched a video for consumer protection against fraudulent scams that highlights ways to identify scams and safeguard practices. Please engage and share with your network to ensure a safe environment.?

135+ members have joined FACE. Join FACE to become part of the community and enhance your impact.?

Members’ Miles

• Ambak raises $7 million in seed and pre-series A round.
• Bureau Raises $30M Series B as Global Fraud Losses Hit $486B. The team is also shortlisted by RBIH and Aditya Birla Capital to tackle the problem statement "Credit Underwriting using Alternate Data."
• Cred, Mobikwik join hands with RBI to fully launch CBDC (e?) for Android, launches e-rupee wallet in partnership with Yes Bank.
• Groww taps five banks for $1 billion IPO, plans draft filing by April.
• Groww Mutual Fund launches India's first Nifty India Railways PSU ETF.
• Hyperverge and Ignosis won the Best Tech Innovator award for the Year.
• PhonePe sharpens quick commerce play in first for a payments company.
• Revfin was featured in?India’s Green Startups, a book by?Sandiip Bhammer and Jayant Sinha.
• Roopya Launches Next-Generation AI Agents for Loan Origination and Underwriting.
• Slice to rebrand as Slice Small Finance Bank, plans expansion.
• UGRO Capital Reports 32% AUM Growth, 19% Rise In PAT.

Upcoming Events

• 5-6 Feb 2025, Mumbai, Bharat FinTech Summit
• 7-8 Feb 2025, Bhubaneswar, International Conference on AI and Financial Innovation
• 13-14 Feb 2025, Mumbai, IBEX India 2025
• 27 Feb 2025, Mumbai, MPAI Annual Summit
• 27-28 Feb 2025, Bangaluru, Entrepreneur Tech and Innovation Summit 2025
• 12-13 Feb 2025, Dubai, FiNext Conference 2025
• 24-25 Feb 2025, New Orleans, Future Digital Finance
• 25-26 Feb 2025, London, Finovate Europe
• 26-28 Feb 2025, Singapore, Annual Fintech Summit 2025