– Amol Dethe, Editor, FinBizness
You must have consumed free WiFi over coffee? But have you heard of free WiFi and electricity over innovation? Yes, you heard it right! This is Maharashtra government’s offer to the FinTechs.
Why and What is Sandbox?
State Government has recently launched a sandbox policy to encourage FinTechs. Under the policy, Fintechs are allowed to test their product without fulfilling the government’s check list of regulations. The idea of the sandbox is to allow startups to experiment without regulations.
“Maharashtra is the first state in the country to launch a sandbox. The agenda is to allow startup to open their APIs (Application Programming Interface) for better innovation. Few other states have also shown interest in partnering with Maharashtra,” said S V R Srinivas, Principal Secretary, (Information Technology) Maha Govt.
Mumbai is the country’s financial capital, and hub for many FinTechs. It is the right place for the government to implement a sandbox policy for the benefit of the largesse. Also, large financial institutions including the regulators and exchanges are headquartered in Mumbai, attracting fintechs to the city.
What’s the Offer ?
Maharashtra Governments sandbox policy has a dedicated Fintech officer. The Government has recruited Suniti Nanda as a Chief FinTech Officer. Ms Nanda was heading Barclays, India Innovation earlier. The FinTech officer will expedite the process and provide clarity on Government policies.
State Government’s sandbox offers meaningful incentives for registered FinTechs. Some of them are reimbursement of SGST for Fintechs. Government will also allow fintechs to access investment funds. It will also reimburse the internet and electricity charges for Fintechs, hosting infrastructure and event participation fees as well. Fintechs willing to join Maha Govt can register on https://lnkd.in/eMrCE_z
Ideas for newer startups is brewing fast in the city, and co-working spaces are filled with new-age entrepreneurs. And now, governments want to hasten their growth, Apart from Maharashtra, Andhra Pradesh is very active in Fintech space, and is running a dedicated project Vizag FinTech Valley.
Globally Singapore and Bahrain launched sandbox policies to promote FinTech activities. “Policy making as a core strength applied to Fintech space. Evolving financial services require policy changes. Technology should be an integral aspect of policy making,” said Sopnendu Mohanty, Chief FinTech Officer, Monetary Authority of Singapore.
Bahrain is the second country which has bought the sanbbox policy. Under the policy, Central Bank of Bahrain (CBB) has relaxed the fees for applications. CBB responds to Fintechs within 15 days and depending on their application they determine which laws can be relaxed. Sanbox policy allows Fintechs to operate with basic rules for nine months.
Maharashtra FinTech Objective
Maharashtra Govt aims to create “World FinTech Hub” in the Mumbai Metropolitan Region. They want Mumbai to be one of the top five FinTech centres in the next five years, to incubate atleast 300 startups in next three years. Govt will also facilitate venture capital funding of at least Rs. 200 cr for Fintech startups in the hub over first three years. Importantly, GoM will create FinTech corpus fund of Rs. 250 cr over the next three years.