Published on: June 1, 2024
‘FRAMEWORK FOR RECOGNIZING SELF-REGULATORY ORGANIZATION(S) FOR THE FINTECH SECTOR’ (SRO-FT FRAMEWORK)
‘FRAMEWORK FOR RECOGNIZING SELF-REGULATORY ORGANIZATION(S) FOR THE FINTECH SECTOR’ (SRO-FT FRAMEWORK)
NEWS – The Reserve Bank of India (RBI) has finalized the ‘Framework for Recognizing Self-Regulatory Organization(s) for the FinTech Sector’ (SRO-FT framework).
- The aim is to bolster self-regulation within the FinTech sector, addressing concerns such as customer protection, data privacy, cyber security, grievance handling, internal governance, and financial system integrity.
KEY POINTS
- Refinement Process
- Initially introduced as a draft on January 15, 2024.
- Refined based on feedback from various stakeholders.
- Objectives of SRO-FT Framework
- Foster a culture of self-governance among FinTech entities.
- Encourage adherence to industry standards and best practices.
- Create a balanced oversight mechanism adaptable to the FinTech landscape.
- Application Process
- Entities meeting eligibility criteria can submit applications with required documentation.
- RBI evaluates applications and publishes eligible entities on its official website.
- Benefits of Self-Regulation
- Strike a balance between fostering innovation and mitigating risks.
- Accommodate rapid technological advancements and market dynamics.
- Ensure responsive and proportionate regulatory environment.
- Regulatory Approach
- Activity-based, risk-based, scale-based, and phased-in oversight.
- Maximize creative potential while minimizing risks to the financial system.
- Impact and Expectations
- Enhance integrity and sustainability of the FinTech sector.
- Improve access, reduce costs, and save time for consumers.
- Contribute to overall stability and integrity of the financial system.
