Sign In
Learn bits
Economy
Mahesh

20/02/24 09:03 AM IST

Report on loacal fintech players

In News
  • In its report presented to Parliament, the Standing Committee on Communications and Information Technology has raised concerns about the dominance of fintech apps owned by foreign entities in the Indian ecosystem and recommended that local players be promoted.
Major Highlights of the report
  • The Committee in its report emphasised that digital payment apps must be effectively regulated as the use of digital platforms to make payments in India is on the rise.
  • It noted that it will be more ‘feasible’ for regulatory bodies such as the Reserve Bank of India (RBI) and the National Payments Corporation of India (NPCI) to control local apps, as compared with foreign apps, which operate in multiple jurisdictions.
  • The Committee observed that fintech companies, apps and platforms that are owned by foreign entities, such as Walmart-backed PhonePe and Google Pay, dominate the Indian fintech sector.
  • PhonePe commands the leading market share in volume terms, followed by Google Pay, at 46.91% and 36.39% respectively.
  • This is for the period between October to November 2023. On the other hand, NCPI’s BHIM UPI’s market share (in terms of volume) stood at a mere 0.22%.
  • NPCI’s data for December last year show that a total of 5,642.66 million transactions were initiated by customers using PhonePe, while another 4,375 million used Google Pay and only about 24.30 million used BHIM.
  • The Committee’s recommendations are also largely in tune with the NPCI issuing a 30% volume cap on transactions facilitated using UPI
Concerns about fraud
  • While examining the different modes used by scamsters to dupe people and park illegal money, the Committee observed that fintech companies were also being used for money laundering.
  • It was apprised of one such example — an Abu Dhabi-based app called Pyppl.
  • The app was being administered by Chinese investment scamsters.
  • This made it difficult for Indian law enforcement agencies to track the trail of money collected through scams on the platform.
  • The fraud to sales ratio, which represents the total number of fraudulent transactions in comparison to the total number of transactions in a financial year, has largely remained around 0.0015%.
  • The trend is notwithstanding the rise in volume of the payment mode in the last five years.
  • In the ongoing financial year (till September 2023) the figure stood at 0.0016%. The percentage of users affected by UPI frauds stood at 0.0189%.
Source- The Hindu

More Related Current Affairs View All

15 Nov

Government issues guidelines to curb misleading ads by coaching centres

'The central Government issued new guidelines aimed at curbing misleading advertisements by coaching institutes, specifically prohibiting false promises such as "100 per cent selec

Read More

15 Nov

Janjatiya Gaurav Divas

'Every year on November 15th, Janjatiya Gaurav Divas is celebrated to honor the contributions of these communities, especially in India’s freedom struggle.' 5th November

Read More

15 Nov

Supreme Court’s order on mandatory accessibility standards

'A bench of the Supreme Court last week ordered the Union government to frame mandatory rules for ensuring the accessibility of public places and services to persons with disabilit

Read More

India’s First Ai-Driven Magazine Generator

Generate Your Custom Current Affairs Magazine using our AI in just 3 steps