Last Week's 17 Fintech Updates You MUST Know

Happy Monday everyone!

Today I am back with another weekly update for the Fintech Companies. Covering updates in the regulatory or economic side of the Fintech market for Indian companies.

If you run a Fintech Company in India. Or you plan on expanding your Fintech Company in India. Then this becomes important for you.

Here are the main things that happened in the last week.

A) Emerging Trends in FinTech

1) Decoding SME Lending: The Challenges of Balancing Disbursements and Collections

Key Insights: At the Moneycontrol Fintech Conclave, SarvaGram’s CEO, Utpal Isser, emphasized that the heart of SME lending lies not in disbursing loans but in ensuring repayments.

Challenges Highlighted:

• Lending involves a nuanced assessment of both borrower ability and intent.
• Disbursement represents expenses, while collections constitute revenue.

Industry Perspective: Kaushik Anand of A91 Ventures noted that some startups view lending as a quick-fix revenue model, without realizing its operational complexities.

2) India Leads the Global FinTech Charge

International Acclaim: At the Money Conclave 2024, experts celebrated India’s advancements in FinTech, particularly the Immediate Payment Service (IMPS) and the Unified Payments Interface (UPI).

Milestones:

• Over 800 million bank accounts were created within eight years.
• UPI’s integration with global systems positions India as a pioneer in financial innovation.

Expert Opinions: Panelists stressed that India's digital infrastructure serves as a blueprint for other nations and anticipated AI's growing role in simplifying product creation.

3) Curie Money Secures $1.2M to Redefine Banking

What’s New: Bengaluru-based Curie Money combines mutual fund investments with seamless payment solutions.

Funding Allocation: The seed round, led by India Quotient, will support product scaling, team expansion, and deeper market penetration.

Unique Features:

• No-minimum-balance savings accounts.
• Instant mutual fund redemption during transactions.
• Recent approval to operate UPI services as a Third-Party Application Provider (TPAP).

4) Mili Raises $2M to Revolutionize Wealth Management Workflows

About Mili: Founded in 2024, the startup focuses on streamlining advisory workflows for wealth management firms using AI-powered meeting documentation tools.

Key Offerings:

• Real-time AI assistance for compliance and customization.
• Integration with leading wealth management platforms.

Growth Plans: Funding from Chiratae Ventures and BoldCap will drive product innovation and team expansion.

B) Economic Landscape in India

1) New CISO Appointment to Bolster FincFriends’ Security Framework

Leadership Update: Sunil Kumar Dinodiya has been named the Chief Information Security Officer of RupeeRedee’s FincFriends, focusing on cybersecurity and regulatory compliance.

Key Focus Areas:

• Strengthening IT security and governance frameworks.
• Enhancing regulatory compliance with RBI guidelines.

Expertise: Sunil brings over 16 years of experience in cybersecurity, risk management, and data privacy.

2) Shift Toward Secured Lending in FinTech

Adapting to Regulations: Amid RBI’s tightening stance on unsecured loans, digital lenders are pivoting toward secured products like micro loans against property and green financing.

Operational Challenges: Physical verification of collateral and other logistical demands make secured lending more cumbersome.

Market Trends: Many digital lenders are exploring hybrid (phygital) models and expanding their feet-on-the-street approach to ensure compliance and customer trust.

3) Sourav Ganguly Becomes Olyv’s Brand Ambassador

Campaign Highlights: Olyv collaborates with Sourav Ganguly to promote financial inclusion through products like digital lending, credit health, and gold savings.

Impactful Messaging: Through ATL, BTL, and digital campaigns, Olyv aims to inspire underserved communities with Ganguly’s values of trust and resilience.

Vision: The partnership reinforces Olyv’s goal to democratize credit access for emerging India.

4) NPCI Warns Users About Digital Fraud Risks

Advisory Issued: The National Payments Corporation of India (NPCI) cautioned against scams like "digital arrest," where fraudsters impersonate law enforcement officials to coerce victims into sharing sensitive data.

Prevention Tips:

• Avoid transferring money to unknown UPI IDs or accounts.
• Report incidents to the National Cybercrime Helpline (1930).

Future Measures: NPCI continues to emphasize public awareness and robust digital safeguards.

5) Digital Payments Surge 16% to ?24.28 Lakh Crore in FY24

UPI at the Forefront: Unified Payments Interface accounted for 79% of transaction volume, reflecting India’s preference for seamless, digital-first payment solutions.

Global Expansion: UPI is now operational in seven countries, enhancing cross-border remittance ease and cost efficiency.

Government Efforts: Initiatives to link UPI with other nations’ payment systems strengthen India’s remittance economy while promoting real-time, low-cost transactions abroad.

C) Key Business Updates

1) QR Code Revolution: UPI Dominates Rural and Semi-Urban India

Highlights from EY-CII Report: Unified Payments Interface (UPI) has become the leading mode of transactions in rural and semi-urban areas, capturing 38% of financial activity among survey respondents.

Survey Insights:

• Strong adoption among youth aged 18-35.
• A significant savings culture, with 96% expressing interest in saving and investing.

Challenges Identified: Gender disparities persist, with only 44% of women transacting regularly via digital platforms.

Expert Opinion: EY’s Saurabh Chandra emphasized that financial literacy and digital inclusion must drive India's journey to a $5 trillion economy.

2) Enteruptors Launches DxEVP to Transform BFSI Operations in India

What’s New: Australian fintech Enteruptors debuted its DxEVP platform through the Microsoft Commercial Marketplace, targeting Indian financial institutions.

Platform Capabilities:

• AI-driven solutions for risk management, compliance, and strategic analytics.
• Aims to improve productivity by up to 300% while enhancing compliance and profitability.

Industry Impact: Enteruptors CEO David Jordan highlighted how DxEVP’s cloud-based architecture empowers BFSIs to tackle challenges like cost reduction and skilled staff retention.

3) Worldline and Forthcode Partner to Innovate In-Flight Payments

Objective: The partnership seeks to modernize airline payment systems using Android POS devices integrated with a cloud-based SaaS platform.

Key Benefits:

• Streamlined in-flight retail and payment operations.
• Enhanced ancillary revenue opportunities for airlines.

What to Expect: By automating payment processes, the collaboration aims to reduce cash dependency while improving traveler convenience.

4) Super.money Prepares for Credit and Wealth Management Expansion

Growth Path: Flipkart-backed Super.money plans to launch credit-on-UPI, unsecured credit cards, and personal loans by mid-2025.

Market Momentum: The platform has scaled quickly, becoming the sixth-largest UPI application in India, processing over 78 million transactions in November 2024.

Future Focus: Super.money is forging partnerships with 10–15 banks to enhance its credit offerings and cater to its 7 million users.

D) Regulatory Compliance Updates

1) RBI Penalizes IndusInd Bank for Non-Compliance

Penalty Overview: A ?27.30 lakh fine was levied for opening savings accounts ineligible under RBI’s 2016 Interest Rate on Deposits Directions.

Reasoning: The bank’s failure to meet regulatory compliance during its 2023 inspection led to the action.

Impact: The RBI stressed that this penalty does not affect the validity of transactions between the bank and its customers.

2) Manappuram Finance Fined for KYC Non-Compliance

Fine Details: The RBI imposed a ?20 lakh penalty on Manappuram Finance for breaching KYC norms.

Violations Cited:

• Failure to verify customer PANs.
• Issuing multiple identification codes instead of a Unique Customer Identification Code (UCIC).

Regulatory Message: The RBI emphasized stricter adherence to KYC standards for ensuring financial integrity.

3) Shri Vaibhav Lakshmi Mahila Bank Penalized for Missing PSL Targets

Action Taken: A ?1 lakh fine was imposed on the Madhya Pradesh-based cooperative bank for failing to contribute to the Micro and Small Enterprises Refinance Fund administered by SIDBI.

Non-Compliance: The bank did not meet Priority Sector Lending (PSL) targets for FY 2022–23, despite RBI warnings.

4) Guna Nagarik Sahakari Bank Penalized for PSL Lapses

Penalty Details: Similar to Shri Vaibhav Lakshmi Bank, Guna Nagarik Sahakari Bank failed to meet PSL targets and deposit funds with SIDBI, incurring a ?1 lakh penalty.

RBI’s Directive: The central bank reiterated its commitment to strengthening PSL compliance as a key driver of inclusive growth.

I hope this was useful to you guys working in the Fintech Space.

The fintech space is everchanging, so staying up to date with information will help you make smart decisions for your business.

Again, If I see any notable changes or updates on the Fintech Side during the week, that can help Fintech Companies, I will compile them. And then share them next week!

Btw - I run a legal firm that's a one-stop solution for Fintech Companies in India.

Whether you are starting out in India, or expanding to the Indian market, DM ?? me if you need legal help with:

1) Business Registration

2) Contract Drafting or Review

3) Compliance

4) Answering any legal questions

See you tomorrow!