 "Being fintech or tech firm doesn't absolve it of regulatory oversight: MoS")
Union Minister of State for Electronics and Information Technology Rajeev Chandrasekhar on Saturday stated that a sectoral regulator has the absolute authority to take action within their sector, and being a fintech or a technology company doesn’t absolve them of regulatory oversight.
“A sectoral regulator has absolute authority to regulate every firm that is a regulated entity within the sector. The Reserve Bank of India (RBI) has done so and it is within their purview. Being a fintech or a tech company doesn’t absolve anybody from regulatory oversight,” said Chandrasekhar on the sidelines of an event in Delhi.
He was speaking at the inauguration of Digital India FutureLABS at the Indian Institute of Information Technology (IIIT), New Delhi.
Noida-based fintech major Paytm has come under RBI scrutiny and saw restrictions on the functioning of Paytm Payments Bank (PPBL) from taking fresh deposits and credit transactions across its services, due to non-compliance with regulations and supervisory concerns.
The action has severely impacted the company. Shares of One 97 Communications, the parent of fintech giant Paytm, plunged 20 per cent for the second straight day at Rs 487.05 on the BSE in Friday's trade after RBI halted nearly all transactions of its digital payment unit, PPBL.
Vijay Shekhar Sharma, founder and chief executive officer of One97 Communications, the parent company of Paytm, in an analyst call said that compliance will be a primary focus for the firm.
“The important thing for us to remember is that if we do not make compliance and risk a core part of the business then it does not become the bigger business that we envision. As far as the group and entity is concerned, we now look at compliance first, technology second approach,” Sharma said.