The RBI has shown significant interest in Blockchain with a number of PoCs, including the Whitepaper we did with the IDRBT and major banks. The RBI will continue to pursue Blockchain solutions to improve interoperability and reduce friction in digitisation.
While cryptocurrencies have been labelled as illegal tender in India, the Governmenthas welcomed Blockchain, the underlying technology for its projects in payment services, agriculture, financial exchanges, infrastructure, education among other sectors. Honourable Min. Arun Jaitley mentioned that the government is currently reviewing the effect of FinTech industry in the country so 2018 will definitely see a rise in scope of work in the said space wherein different industries may go for PoCs to test the efficiency of the blockchain technology in respective use cases.
Going into 2018, more banks are seeking to use this technology to transform parts of their business, especially to reduce frauds.
Governments of Andhra Pradesh, Telangana have already embraced the possibilities of blockchain by testing it for land deals. Similarly, Maharashtra CM Mr. Devendra Fadnavis too, welcomed the technology by saying it will reduce trust deficit.
As the backbone of the Indian economy, the government will continue to seek to find ways to give MSMEs easier access to capital, for example the TReDS exchanges. They will emphasize access to GST for MSMEs. After the GST implementation in 2017, the mass formalization of businesses taking place under the MSME umbrella has increased multi-fold and has enabled the government gain more insights on the database and financing of the sector. Budget 2018 also mentioned that the government will be working closely with banks to enable digital loan sanctions and ease the cash flow challenges for MSMEs at large. FinTech industry of India is said to be a strong help for the MSME sector in the coming time. The Budget stated that the reduced 25% tax bracket will be extended to companies with Rs. 250 crores as turnover as opposed to the previous slab of Rs. 100 crores in turnover. This is likely to help a whole new section of MSME players while the Government will forego Rs. 7000 crores of tax revenue in 2018-19 due to this amendment.
The 2018 Budget will be good for the FinTech industry because of the focus on digital initiatives and the need for innovative solutions in promoting a digital economy. The push for a digital economy has been a focal point with the government for a long time, and, stringent actions have been taken in the form of GST, Demonetization, formalization of the economy and mainstreaming of financial savings into the banking system. A digital shift has also taken place in the form of BHIM app, Aadhaar Pay among other platforms and this will enable FinTech players in the country to expand their scope of work and provide solutions as well as uplift sectors like MSMEs, Supply Chain Management, Financial Inclusion of grass root level, among others.
The government will again strengthen the Financial Inclusion Fund based on the success of these initiatives, but the need to continue to reduce friction in digitisation and education.
Supply Chain Management
Once again the world’s fastest growing economy, India’s trade and exports are critical to continue that growth. With a number of initiatives to improve supply chain management and infrastructure in motion, there is a need to digitise and rationalise supply chain management as well as bring more transparency in credits, debits, fraud management, among other relevant factors in the industry.
@Technuter.com News Service