RBI to Set up Innovation Hub (Download PDF)

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RBI to Set up Innovation Hub

  • RBI has announced that it will be establishing an innovation hub.
  • The hub will promote innovation across the financial sector by leveraging on technology.
  • The hub will act as a center for ideation and incubation of new capabilities.
Innovative Products and Services

Overview

  • The capabilities generated can be leveraged to create innovative and viable financial products and services to help achieve
    • Financial inclusion
    • Efficient banking services
    • Business continuity in times of emergency
    • Strengthening consumer protection
  • The innovation hub will support, promote and hand-hold cross thinking spanning regulatory remits and national boundaries.
  • Previously, the Regulatory Sandbox framework was a similar initiative in which Digital Payments were the first cohort.
  • The sandbox had accepted six proposals, the trials and pilot studies of which have been delayed due to Covid-19 situation.
  • While thinking about financial sector innovation areas that remain in forefront are
    • Cybersecurity
    • Data analytics
    • Delivery platforms
    • Payments services
  • The scope of Priority Sector Lending (PSL) will be expanded to include startups in the country.
  • As per the framework, the companies with a net worth of over ₹ 500 crore will be eligible to set up an umbrella entity which among other things will be permitted to set up, manage and operate new payment systems in the retail space comprising ATMs, White label PoS, Aadhar based payments and remittance services.
  • The umbrella entity will be permitted to operate clearing and settlement credit, liquidity and operational and preserve the integrity of the system.

- Published/Last Modified on: January 21, 2021

Science/Technology, Economy

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