There is a possibility that different self-regulatory organizations (SROs) may be established for various fintech sectors in the payments and digital lending space, according to industry players involved in discussions with the regulator. This is because a single SRO may not be able to cater to the diverse needs of the industry.
“The RBI governor (Shaktikanta Das) spoke about an omnibus framework for SRO, which implies a common framework for SROs. He also mentioned that the RBI may prescribe sector-specific additional conditions at the time of calling for applications for recognising such SROs. This gives us the impression that there may be separate SROs for digital lending and payments. This is because a single SRO may not be capable of taking on all the required functions,” said Jatinder Handoo, CEO, Digital Lenders Association of India (DLAI), an industry association for digital lenders.
“We are expecting the RBI to come up with a circular soliciting interests for industry associations and with criteria for application in a month or one and a half months. This will be followed by 15-20 days for entities to apply for the same. After the application, it may take another eight-12 weeks for evaluation,” he said.
The RBI governor urged fintech companies to establish an SRO in a speech at Global Fintech Fest (GFF) 2023 in Mumbai last month. An SRO is a non-governmental organisation that acts as a bridge between industry players and the regulator, and sets standards for the conduct of entities operating in the country.