A combination of policy changes such as bankruptcy law and taxation code and the enabling environment created by the digital public infrastructure has made India an attractive investment destination for the financial technology sector, a senior World Economic Forum (WEF) official said.
In a video interview with PTI, Matthew Blake, Head of the Centre for Financial and Monetary Systems at the WEF said India has been one of the best-performing markets in the world and investors have made money here.
Blake also struck a word of caution saying that since markets do not move in a purely linear fashion and were prone to “ups and downs”, there was a need to educate investors.
“So this idea of being an informed investor, a diversified investor, and having access to educational resources to do that is really fundamental artificial intelligence (AI),” he said.
“I think a combination of different policy choices that have been made make India quite an attractive investment destination. In addition to the digital public infrastructure that creates an enabling environment from a technological standpoint, you also have changes in the bankruptcy law and taxation code adding clarity,” he said.
Blake said a survey of fintech CEOs by the WEF and the Cambridge Centre for Alternative Finance had revealed that 70 per cent of the firms considered AI as a major force and could be deployed for personalisation and customisation of products and services.
Blake said for sectoral regulators, AI could be helpful in the context of risk management and there was a need for them to adapt to the rapid changes in technology.
“The sophistication level of the regulatory authorities will also need to increase commensurate with the business sector and talent. Technology, and technologically savvy talent, will be at a premium. And that’s true in the private sector, and that’s true in the public sector,” he said.
Blake said in the Asia-Pacific region, the regulatory agencies were generally viewed as being quite skillful.
“When you look globally, obviously there are varying levels of sophistication of markets. This brings an opportunity globally to share best practices and competencies,” he said.
“One of the things that we’re looking at is how do you bring the most sophisticated actors in the financial services space from the private sector together in a knowledge exchange with some of the key supervisory bodies,” Blake said.
“It is absolutely in the best interests of the business sector that their corresponding regulator understands as closely as they do their activities and the technologies they’re using to conduct those activities. So, it is in the mutual best interest to share that information and to try and level set. That is a rather large challenge, but it’s something that we as a team are looking at currently and trying to devote some time to,” Blake said.
The WEF-Cambridge report on ‘The Future of Global Fintech: Towards Resilient and Inclusive Growth’, released in January, found that the majority of financial technology companies hold a positive view of their regulatory environment, with 63 per cent rating it as adequate.
Additionally, 38 per cent of surveyed fintechs cited the regulatory environment as a major supporting factor for their operations and growth.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – PTI)
