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RBI’s two fintech SROs: Who sets the rules, monitors compliance and acts against violations?

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RBI’s two fintech SROs: Who sets the rules, monitors compliance and acts against violations?

RBI’s two fintech SROs: Who sets the rules, monitors compliance and acts against violations?

With the recognition of Unified Fintech Forum as the second self-regulatory organisation for fintechs, the RBI is expanding an industry-led oversight mechanism. ETBFSI explains what powers these bodies have, where their authority ends, how FACE and UFF differ, and the challenges facing the framework.

-Hashmeet Kaur The Reserve Bank of India’s (RBI) recognition of the Unified Fintech Forum (UFF) as the second Self-Regulatory Organisation in the FinTech Sector (SRO-FT) has expanded the central bank’s industry-led oversight framework for the sector. UFF joins the FinTech Association for Consumer Empowerment (FACE), which was recognised as the first SRO-FT in August 2024. The move comes as fintech businesses span an increasingly diverse range of activities, from digital lending and payments to wealth management and technology-led financial services. Monitoring every operational practice and emerging business model through direct regulatory supervision can be challenging for the central bank. Advt

The SRO framework seeks to address this gap by giving industry bodies a formal role in setting standards, monitoring members and promoting responsible conduct. However, the RBI retains its statutory regulatory powers, while the SROs remain accountable to the central bank and operate within the boundaries of its framework. ETBFSI brings to you an explainer on what the Fintech SRO framework is, how powers are divided, how FACE and UFF differ, and what this dual-SRO setup means for the industry and consumers. What is a Self-Regulatory Organisation? A Self-Regulatory Organisation for the FinTech Sector (SRO-FT) is a not-for-profit industry body recognised by the RBI to establish and promote standards of conduct, governance and compliance among fintech companies.


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