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Budget 2019: Boost start up ecosystem; ease MSME lending, says Expert

Updated: Jul 02, 2019 10:15:29am
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Budget 2019: Boost start up ecosystem; ease MSME lending, says Expert

New Delhi, July 2 (KNN) As budget 2019 is approaching fast, expectations of the industry have started to surface. The last government's progressive policies have made the environment favourable for entrepreneurs, it is believed that this budget will lay down reforms to boost start up ecosystem in India, said Seema Prem, CEO of FIA Technology Services Private Ltd.

She said “We also believe that like in past, the government’s focus will be on deepening financial inclusion and formulate policies to strengthen the PMJDY program. Digitising the cash ecosystem, easing Micro Small and Medium Enterprises (MSME) lending and focus on removing barriers to adoption of mutual funds and insurance will be key focus area.”

Also, seeing the current scenario of Banking in India, the Union Budget for 2019-20 is likely to spell out roadmap for banking reforms.  FIA tech, a leading fintech company in digital payment & distribution systems for last mile financial inclusion in Indian and Nepal, would like the government to outline solutions to support fintech startups.

With this budget, we expect that the government introduces measures to ease working capital blockages, with possible reduction in compliance burden, she added.

The Business Correspondent (BC) industry is hopeful that the budget will address the procedural issue of Reverse Charge Mechanism (RCM). It is important that Business Correspondent industry gets RCM exemption. BCs should be allowed to deposit in reverse charge in one state, preferably the state of registration or headquarters rather than taking registration in all states. This will improve the ease of doing business for the BC industry who are mainly fintech start-ups and reduce the cost of procedural compliance significantly.

She shared “We also believe that AI can be leveraged by financial institutions to completely redefine how they operate, establish innovative products and services, and impact customer experience. Some of the challenges that we see are the lack of collaborative platforms for niche resource sharing, inability to tap public data systems due to questions around data privacy and ownership. GoI should formulate clear policies around data and create an enabling ecosystem for sharing relevant government data and public records. Allocating funding for AI startups will give the industry a much needed impetus.”

Sharing fintech expectations, she stated that fintech expects this government to come up with measures to ease out the funding procedure and wants them to increase reach of already available government funds under the corpus such as Financial Inclusion Funds. Financial Inclusion Funds as of now is not available for all form of business and is eligible only for NGOs & Banks.

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