After a year marked by turbulence, including legal crackdowns and hefty tax notices, the fintech industry is now looking to Modi 3.0’s budget with high expectations.
For MSMEs, the primary focus remains on enhancing credit flow. One anticipated measure is the expansion of MSME credit guarantees.
After a year marked by turbulence, including legal crackdowns and hefty tax notices, the fintech industry is now looking to Modi 3.0’s budget with high expectations.
Fintech industry stakeholders anticipate that the budget will address the challenges it faced over the past year and provide a more stable and supportive regulatory environment.
Fintech, NBFCs, MSMEs are expecting the budget to come up with measures that promote digital growth, encourage innovation, improve fiscal incentives and tax exemptions.
Inclusive Growth and Robust Digital Payments Ecosystem
FinBox CEO Rajat Deshpande states that the fintech industry is looking at initiatives that encourage strategic partnerships between fintechs and traditional banks, enabling companies to reach the underserved communities and pave the way for a more inclusive and accessible financial future for all Indians.
“Continued allocations towards the Digital India Initiative can help bridge the digital divide and further extend access to tech.
Efficient grievance redressal mechanisms and policy-level fraud prevention measures will foster transparency, build trust, and ultimately make the lending process smooth,” he added.
Strengthened Policies and Increased Credit Flow for MSMEs
For MSMEs, the primary focus remains on enhancing credit flow. One anticipated measure is the expansion of MSME credit guarantees. This would involve broadening the range of enterprises and types of credit covered, including smaller loan amounts and similar provisions.
“A larger ambit under the credit guarantee scheme encourages more lenders to service enterprises often branded as high-risk".
Another way to augment credit flow is through the introduction of policies that strengthens adoption of account aggregators by data contributors. This would create a robust data network, enabling providers like us to assess reliable details faster and ultimately improve credit access for MSMEs across India,” Alok Mittal, co-founder and MD of Indifi stated.
Tanmay Kumar, CFO of Shiprocket also added that expanding credit guarantee schemes and promoting digitisation through affordable tools like GST compliance and amplification of such schemes on social media platforms to increase visibility can empower MSMEs with the right tools and knowledge, creating a supportive ecosystem for sustainable growth.
Focus on Employment, Infrastructure and Innovation
Building on the interim budget from earlier this year and addressing the recent economic challenges, the upcoming full budget is anticipated to prioritize employment, infrastructure, and innovation.
“We expect the government to double down on initiatives relating to upskilling of youth to improve employability. Alongside this, increasing jobs is expected to be the core government agenda. We expect this to be through a dual approach of easing credit access to small and medium businesses to catalyse their growth and through incentives on research and investments from the private sector,” Gaurav Jalan, founder and CEO of mPokket stated.