The Tech Panda asked the Union Budget expectations from FinTechs and crypto companies.
Last year, the Budget earmarked INR 1,500 crore for a proposed scheme to provide financial incentives to promote digital modes of payment, which was welcomed by the FinTech industry. This year, again, the FinTech industry has precociously had to rev up in the face of the pandemic stubbornly carrying on, and India’s FinTechs have many expectations from the 2022 Union Budget and all eyes are on Finance Minister Nirmala Sitharaman. As a proliferating industry, FinTechs seek more incentives as well as a push for more Indian users to jump on the UPI bandwagon.
The financial year 2021-2022 had been quite an eventful year for the blockchain and crypto industry, especially in terms of regulating the industry. Hence, the volatile cryptocurrency industry too looks forward to more uniform regularity and a better informed audience as potential investors.
The Tech Panda talked to Fintech and crypto organisations to find out how they want the upcoming Union Budget to play out.
Mitesh L Thakker, Founder & CEO, MissCallPay
Incentivize new UPI users
“UPI as a revolution from India, has reached only 20 crore users of 118 crore mobile subscribers in India, government should incentivize new users, primarily the low middle income and Jan Dhan Account holders who on-board on UPI for the first time, also provide incentives to FinTechs into feature phone, voice, and USSD based payments space to help absorb operational cost of technology so that UPI revolution reach into nook and corners of Bharat,”
Dr. Navneet Gupta, Founder & CEO at YPay
Continue investment into infrastructure to promote digital payments
Steady KYC norms
“Extension of the tax holiday for startups would be a great way for the government to show its commitment towards building a robust and dynamic startup environment. Investment into infrastructure that would promote digital payments needs to continue rapidly. There is so much unexplored potential in Tier-2 and 3 cities, let alone villages.
“The pace of investment only needs to go up if this potential is to be meaningfully utilized. For Neobanks and PPI companies such as ours, the idiosyncrasies of and changes in KYC requirements are actually a major nuisance. KYC norms lead to several problems such as registration issues for customers. And finally, the government needs to see the FinTech industry as a partner in helping formalize the economy and getting banking services to those who do not have access to them.”
Aditya Damani, Founder, Credit Fair
Encourage Capex, SMEs, & FinTech financing
“The government must find a fine balance between promoting economic growth and securing its finances. We expect the government to support Credit Fair’s focus sectors of healthcare, housing, and education because they are critical to building our social infrastructure and creating jobs.
“The LIC IPO, as well as other revenue-raising strategies, will be critical for the government. We’re hoping for a budget that is fiscally sensible, as inflation has been growing, which could lead to increased interest rates, which would be a headwind on FinTech. Interest rates will need to be kept low, particularly in government bonds and fixed deposits, to encourage Capex, SMEs, and FinTech financing.
“As a provider of Alternative Assets, we expect that the Budget will encourage people to diversify their portfolios and allow pension funds to invest in a broader choice of fixed income and equity assets developed by FinTech.”
Kumar Gaurav, Founder & CEO, Cashaa
Introduce a stringent framework
Heavy fund infusion by foreign investors
“The crypto industry has stayed amidst speculation for a couple of years now. With the upcoming budget we expect the government to introduce the regulations that the community has been waiting for a long time. The positive growth is only possible with the introduction of a stringent framework. This is also expected to welcome a heavy fund infusion in the country by foreign investors.”
Progressive taxation policy for crypto
More clarity in terms of regulation
“I see 2022-2023 would be even more crucial for the industry as we foresee more clarity in terms of regulation as well as taxation from the Government. We request our Honourable Finance Minister to bring more stability to the industry with the upcoming Union Budget.
“I believe crypto-assets if regulated properly and in a more liberal manner can bring tremendous benefits to the economy with by-products like increased prosperity to the investor community and at the same time protecting them from any potential threats. Also, introducing a progressive taxation policy for crypto will boost the industry’s confidence.
“We also wish that the Government should encourage startups involved in gold, silver, and other commodities. We hope that the stringency of regulations would be reduced and retrograde tax should not be there so that more people could access it.
Standardize best practices
Address common misconceptions
Propose a crypto tax law
“Leading cryptocurrency exchanges now adhere to tight self-regulation measures. We anticipate that the next Union Budget will provide regulatory clarity and assist standardize best practices, as well as addressing common misconceptions about this new asset class. We believe that a more regulated environment will encourage more Indians to begin their cryptocurrency investing journey. Crypto taxes would also be something to think about, and we anticipate that a crypto tax law would be proposed.”