FINTECH Round-up: Quarterly Updates

In our second edition of the fintech newsletter, we delve into some significant developments that are shaping the landscape of fintech in India. This issue provides an overview of new guidelines on digital lending, draft directions on payment aggregators and other notifications issued by the Reserve Bank of India (“RBI”). The Securities and Exchange Board of India (“SEBI”) also released a framework for administration and supervision of Research Analysts and Investment Advisers. This newsletter highlights these and other key developments in the Indian fintech space for the second quarter of 2024.

Key Developments in Insurance Space

IIn this article, we bring you an overview of the latest legal developments and updates in the evolving regulatory framework relating to the insurance industry. The article focuses on the key tenets of the new regulations and the master circulars issued so far. 

Regulatory Updates - Reserve Bank of India Recent Circulars

Reserve Bank of India (RBI) on August 18, 2023, issued three separate instructions regarding (i) levy of penal charges by the lenders, (ii) interest rate reset on EMI-based personal loans, and (iii) a review of the regulatory framework for IDF-NBFCs. 

Default Loss Guarantee: RBI clarifies their stand

The Reserve Bank of India (“RBI”) had, basis the recommendations of the Working Group on ‘digital lending including lending through online platforms and mobile apps’ (“Working Group Report”), issued a press release on August 10, 2022 (“Press Release”) followed by the “Guidelines on Digital Lending” on September 2, 2022 (the “DL Guidelines”). 

Digital Lending - The confusion continues.

The Regulated Entities ("REs") who are covered: The applicability of the norms on digital lending largely remains the same as highlighted by us in the Preliminary Update. The Guidelines are applicable to digital lending extended by (a) all commercial banks; (b) Primary (Urban) Co-Operative Banks, State Co-operative Banks, District Central Co-operative Banks; (c) Non-Banking Financial Companies.

The New Digital Lending Regulations - Decoding the way forward

The Reserve Bank of India ("RBI"), which regulates credit systems and markets in India, has been considering the regulatory ecosystem around 'digital lending' ("Digital Lending") for some time now.

The Banking Regulation Review - The Law Reviews

Our partners Vineetha MG, principal associate, Pratik Patnaik, senior associate, Namit Gehlot and associate, Shubham Bharti penned the India chapter for ‘The Law Reviews (TLR)’ for their book, “The Banking Regulation Review, Edition 13”. The chapter encompasses the spectrum of banking regulations in India including regulations covering #investments by the banks, their control regime and transfer of banking business. The chapter also covers the major steps initiated by Reserve Bank of India in recent past. Some of the emerging concepts on the horizon such as "#DigitalBanking", "Potential of ARCs for Stressed Assets" and “#Confidentiality Requirements of RBI” have also been conversed.

Framework For Resolution Of Stressed Assets – The New Regime!

Analysis of the Reserve Bank of India (Prudential Framework for Resolution of Stressed Assets) Directions 2019.

Judgement on stressed assets circular – adds to the “stress” of the lenders?

Implications of the RBI circular on “Resolution of Stressed Assets – Revised Framework” dated February 12, 2018 being struck down by the Supreme Court.

NBFCs – Time to spruce up IT Framework

Highlights of the key compliances introduced by the Reserve Bank of India under the Master Direction on ‘Information Technology Framework for the NBFC Sector’.

Foreign Direct Investment in Other Financial Services

Highlights of the key regulatory changes around FDI in the category of “Other Financial Services”.