Fintech Watch | Fintech News Roundup For The Second Week Of October 2023 presents a highlight of the major events of this week that contribute their important role in Fintech industry and their impacts in the future.

As we witnessed, fintech funding in India recorded a 68% surge in the July–September quarter. Continuing the funding momentum from the previous week, the second week of October witnessed Indian startups bagging $288 million across 24 deals. This week’s funding marks a 142% increase from the $119 million secured by Indian startups in the previous week across 11 deals. Additionally, this week also saw a mega-deal, as fintech startup Zolve bagged $100 million in a debt funding round.

Now we will discuss here the news that got the attention of the media and made a place in media coverage in the second week of October:

India and Sri Lanka working to link UPI with Lanka pay

India and neighbour Sri Lanka are working on collaborating on digital payments. A linkage between India’s near-ubiquitous Unified Payments Interface and the island nation’s Lanka Pay is in the works, said Prime Minister Narendra Modi on Saturday.
PM Modi was speaking at a ceremony to flag off a ferry service between Nagapattinam, Tamil Nadu, and Kankesanthurai in Sri Lanka when he said, “Our vision for connectivity goes beyond the transport sector.”
India and Sri Lanka collaborate closely in a wide range of areas, such as fintech and energy. Digital payments have become a mass movement and a way of life in India due to UPI.

RBI slaps Paytm Payments Bank with a massive penalty

The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 5.39 crore ($650,000) on Paytm Payments Bank for its failure to comply with Know Your Customer (KYC) norms and other specific regulatory provisions, as explicitly revealed in a press release issued by the central bank.

According to the press release, “This penalty has been imposed in exercise of powers vested in the RBI conferred under the provisions of Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949.”

Razorpay doubles down on existing customers as new onboarding remains paused

Digital payments company Razorpay, which has been barred from onboarding new customers for its payment gateway business by the central bank, is now trying to generate more business from existing customers through new product lines as it tweaks its go-to-market strategy.

The company launched its latest solution, Optimizer, on Monday. Optimizer will allow businesses with large transaction volumes to avoid transaction failures and reroute transactions in real-time. With Optimizer, the payments fintech is looking to increase payment success rates by 10% for businesses.

RBI’s Global Hackathon 2023: Indian FinTechs dominate winners with innovative apps

The Reserve Bank of India (RBI) has revealed the winners of its Global Hackathon 2023, themed ‘Inclusive Digital Service’. The competition witnessed a remarkable turnout, attracting 154 proposals from both domestic and international teams. Indian participants shone brightly, clinching top spots by offering innovative FinTech solutions that cater to diverse needs.

Ezetap Mobile Solutions Pvt Ltd, now under Razorpay, emerged victorious in the ‘Innovative, easy-to-use, digital banking services for differently-abled (Divyaang)’ category. Their winning creation, DrishtiPay, revolutionizes transactions for the visually impaired. By simply tapping their card or NFC-enabled phone, users can securely provide OTP, eliminating the struggle of entering a PIN. Additionally, the solution integrates seamlessly with UPI apps, enabling effortless UPI payments.


Aye Finance eyes a 70 percent jump in FY24 borrowing at Rs 3,400 crore

Non-bank lender Aye Finance said it is aiming for a 70 percent jump in its FY24 borrowing at Rs 3,400 crore as against the Rs 2,000 crore done in FY23. Aye Finance, which focuses on lending to microenterprises, has already raised Rs 2,100 crore of debt till now and is confident of achieving the overall target for the ongoing fiscal year, as per an official statement.

Chief Financial Officer of Aye Finance, Krishan Gopal, said the lenders to the company have comfort and confidence because of its repayment record and have extended multiple lines.

OmniCard collaborates with ONDC as the first FinTech to issue corporate gift cards

OmniCard is proud to have added yet another feather in its cap as the first FinTech company to issue exclusive ONDC Corporate Gift Cards, thereby ushering in a new digital era of corporate gifting, rewards, and employee engagement.

The ONDC Network Gift Card marks a historic milestone in the Indian digital commerce landscape, and OmniCard proudly becomes the first FinTech to offer this innovative solution. This collaboration with ONDC can create more accessible, efficient, and secure digital commerce experiences that benefit everyone involved. This collaboration underscores their unwavering commitment to driving innovation and contributing to reshaping the digital ecosystem in India.

The RBI may have dashed early rate-cut hopes with a 4% inflation pivot

In the recent monetary policy statement, Reserve Bank of India (RBI) Governor Shaktikanta Das reiterated the central bank’s inflation target of 4%, emphasizing that it was not within the 2-6% tolerance band. Central Bank has substantially increased its forecast for the second quarter’s CPI inflation print to 6.7%, third quarter at 5.7% and Q4 at 5.2%. Sonal Varma of Nomura’s forecast for headline inflation to settle in the range of 5.6% for the rest of FY24.

This may have dashed the rate-cut hopes of several brokerages and clarity may emerge only in the next policy meeting in December.