As the Founder & CEO of PaySprint Private Limited, with a deep-rooted commitment to driving innovation and fostering financial inclusion, my expectations for the India Budget 2024 revolve around key measures that can propel the fintech sector forward. With over two decades of experience as a Senior Techno-Functional professional, I bring a unique perspective, anticipating policies that can support the industry’s growth and impact.
Now, as we brace ourselves for the upcoming elections, the Union Finance Minister is consciously driven to present the Union budget 2024-25, with it being a prerequisite to anticipated financial planning and fueling economic growth.
SMEs play a crucial role in the Indian Economy and are considered the driving force behind socio-economic development in India. Currently, there are more than 90 million SMEs in India, which have generated over 110 million job opportunities and contribute more than 30% to India’s GDP, as stated by Niti Ayog.
However, Despite making progress and advancing toward financial inclusion, SMEs’ potential is yet to be chased optimally. For instance, in many cases, SMEs are not bankable, due to lengthy/ complex paperwork, lower capitalization, longer duration to get credit & no-online modes for tracking of loan applications. Making these challenges one’s superpower, Business Banking solutions by SMEs should be made more accessible and convenient, by integrating services under one unified platform, making it a one-stop shop offering financial services or non-financial services, encompassing insurance, payment of taxes, utility bills, and e-ticketing.
With it being a catalyst, SMEs have found themselves non-bankable due to no credit rating as well as disturbed cash flows. The issues mainly breed around low technology innovation, inadequate product as well as less security or no collateral. To its rescue, there should be solutions such as customer innovation or reduced complexities.
By addressing these challenges and providing comprehensive business banking solutions, SMEs can unlock their full potential and contribute even more significantly to the Indian economy.
I anticipate that Contextual finance should be at the forefront, providing personalised experiences to customers’ businesses on a larger scale. Additionally, this approach would allow these platforms to use data to improve financial access and reduce costs. It is by introducing banking solutions in a way that would streamline SME operations with utmost efficiency. It is the introduction of such steps, which can propel this sector forward and help SMEs move away from the tag of underserved.
Picture this, remote account openings for businesses, effortlessly user-friendly digital banking experiences, seamless integrations that connect all aspects of our financial lives, and bespoke financial solutions tailored to meet requirements of each business.
As per the budget of 2024, we look forward to a push to opening of Current Account for SME and thereby, leading to tech solution/platform of Account Aggregator of Current Account’s along with all transactions in a single platform, thereby contributing to a better user experience, effective fund management and the ability to attract capital/funds.
Continuing the discussion related to business banking, we anticipate a breakthrough in technology, with the government introducing provisions to support SMEs in supporting the adoption of real-time banking with quick payments.
In light of this, it is envisaged that staying ahead in technology and being backed by supportive policies is not only a requirement but the need of the hour.
Additionally, the banking landscape must undergo development, with proposed investments for SMEs regarding payments, digital reforms, and small-finance banks, as underpinned by many. Also, Awareness was found lacking about government programs, implemented through banks for the development of the SME sector. Therefore, we expect intervention in this regard from the Government.
As we approach the unveiling of the budget on the 1st of February, the fintech community looks forward to policy initiatives that align with these expectations. A budget that recognizes fintech’s pivotal role in shaping financial services’ future and provides the necessary support will undoubtedly contribute to India’s more inclusive, technologically advanced, and thriving fintech ecosystem.