A new report from the India-UK Financial Partnership (IUKFP) – the leading forum for financial services cooperation between India and the UK – sets out how the two countries can accelerate and enhance collaboration on financial technology (FinTech) and innovation to boost respective sector growth. The report will be formally launched at the UK-India Financial Markets Dialogue on 19 April.
The report, ‘Harnessing the power of FinTech and data’, includes a series of recommendations for the Indian and UK governments and regulators. They make clear the opportunities for the UK in collaborating with India as a priority partner to implement the recommendations of the FinTech Review led by Sir Ron Kalifa, including learning from each other’s successes, and also how to further strengthen the two countries’ respective FinTech ecosystems and contribute to the shared agendas of financial inclusion and levelling-up.
The IUKFP recommendations are focused on policymakers and regulatory authorities in each country:
On the UK side:
- Launching an international FinTech credentials portfolio and an international FinTech portal for inbound investment from India through pilot programmes, making India the priority partner for the UK in building alignment with developing markets.
- Securing access to global talent through launching a UK-India mobility partnership with a FinTech lens.
- Implementing a coalition on digital ID, bringing together various stakeholders, looking at how India’s world-class Aadhar digital identity scheme can be extended to the UK and learning from India’s experience on payment systems.
- Developing the UK as a complementary source of capital for Indian FinTech firms and unicorns that are thinking of going public.
On the India side:
- Leveraging the India Stack, considering how access to the new account aggregator framework, which allows data to be shared among several parties, could be broadened to more domestic and international firms and promote innovation.
- Inter-operability and bank switching, how India can learn from the UK’s experience with open banking.
- Cross-border applications of Central Bank Digital Currencies (CBDCs) and the role of CBDCs in enhancing payment systems.
- The development of FinTech platforms for SME financing, which would help encourage cross-border trade and capital flows between India and the UK.
- Enhancing the FinTech ecosystem with cybersecurity and data protection, allying India and UK data-sharing regimes to share best practices and establishing mechanisms for specialist firms from both countries to learn and develop bilaterally.
Bill Winters, Group Chief Executive, Standard Chartered and UK Chair of the IUKFP, said, “The UK and India are both world-leading FinTech centres and make natural partners on financial innovation. There is much for us to learn from our respective successes and much to gain from our respective potential. We believe that if adopted, the recommendations set out in this report – which have been developed by businesses across the UK and India – will help to deepen and strengthen our collaboration and opportunities for growth in the future.”
Uday Kotak, MD & CEO, Kotak Mahindra Bank Ltd and India Chair of the IUKFP, said “India and the United Kingdom have a long-standing economic relationship, with the UK being one of India's top trading partners. Both countries also have world-class FinTech ecosystems, making them natural partners in financial innovation. The UK can learn from India’s successful experience in payment systems whereas for Indian FinTech firms and unicorns, the UK could be a good source for both growth capital and emerging technology pool. The recommendations presented in this report can further enhance the FinTech ecosystem, benefitting financial inclusion and the creation of new benchmarks across the globe.”
The IUKFP FinTech Working Group, which authored the ‘Harnessing the power of FinTech and data’ report, is co-chaired by Sherry Madera and Professor Tarun Ramadorai. The group is grateful to Sir Ron Kalifa for his guidance on the UK recommendations.