The end of 2021 and the beginning of 2022 has come bearing gifts for the financial technology (“Fintech”) sector particularly for the lending space. The Reserve Bank of India (“RBI”) had amended the Credit Information Companies Regulations, 2006 (“Regulations”) on November 10, 2021 vide the Credit Information Companies (Amendment) Regulations, 2021 (“Amendment”)[1] – the first amendment since 2017 – expanding the scope of entities falling within the definition of ‘specified users’ under Regulation 3 to include “an entity engaged in the processing of information, for the support or benefit of credit institutions, and satisfying the criteria laid down by the Reserve Bank from time to time.”

Anu Tiwari
Partner in the Corporate, M&A and Financial Institutions Advisory Practice at the Mumbai office of Cyril Amarchand Mangaldas. Anu has over 15 years of experience and advises clients on matters related to public and private M&A, raising capital, commercial agreements, and activism. Anu represents both Indian and multinational fintech, banking, broker-dealer, exchange, asset management, speciality finance and information technology companies on transactional, enforcement and regulatory matters.
Anu has been a member of RBI’s Committee on Household Finance, SEBI’s Working Group on Mutual Fund Regulation, Fintech Committee of the Confederation of Indian Industries (CII) and a visiting faculty at the SP Jain School of Global Management.
Mr. Tiwari has been recognised by Chambers & Partners, IFLR, MergerMarket and as Lawyer of the Year 2021, India, by Global Law Experts for his work in the M&A, Financial Regulatory and Blockchain/ Cryptocurrency space. He can be reached at anu.tiwari@cyrilshroff.com
FIG Paper (No. 8) – New Master Directions for PPI – A Fresh Look at Prepaid Payment Instruments!
Introduction:
With the pandemic acting as a tailwind for the digital payments industry in India, the fintech industry represents a key opportunity for the Reserve Bank of India (“RBI”) for its financial inclusion push in the country. A key driver in this regard is the burgeoning prepaid payment instruments (“PPI”) industry. PPIs have been widely used in the country for many years, but have seen significant commercial changes in recent times to reach a wider consumer base, given the high market penetration of mobile internet in India.…
FIG Paper (No. 7) – Cryptocurrency in India!
Introduction:
In recent years, investments in cryptocurrencies have witnessed exponential growth, with growing recognition by established financial institutions across the globe and cryptocurrencies morphing from a digital payment method to an asset class for investment.
Continue Reading FIG Paper (No. 7) – Cryptocurrency in India!
FIG Papers (No. 6: Series–2) RBI Payment Regulations – 2009 to 2021: Bank ‘nodals’ to PA/PG licenses!
Introduction:
In our previous FIG Paper, we shared key learnings from our experience in connection with the payment aggregator and payment gateway guidelines (“PA/PG Guidelines”) issued by the Reserve Bank of India (“RBI”) on March 17, 2020. Based on representations received from various industry associations and payment intermediaries, the RBI has formalised the clarifications (initially issued on September 17, 2020) relating to the PA/PG Guidelines on March 31, 2021 (“Clarifications”).
Continue Reading FIG Papers (No. 6: Series–2) RBI Payment Regulations – 2009 to 2021: Bank ‘nodals’ to PA/PG licenses!
FIG Papers (No. 5 : Series -1) : RBI Payment Regulations – 2009 to 2021: Bank ‘nodals’ to PA/PG licenses!
Introduction:
In early March 2020, a regulatory moratorium imposed on a private bank in India froze the country’s digital payments ecosystem. Many payment aggregators (“PA”) and payment gateways (“PG”) had set up nodal accounts with this bank, including others, and it raised a question on whether the customer funds pooled in those accounts were bankruptcy ‘remote’. Within 10 days, the Reserve Bank of India (“RBI”) issued the payment aggregator and gateway guidelines (“PA/PG Guidelines”) on March 17, 2020, under the Payment and Settlement Systems Act, 2007 (“PSSA”), to regulate PAs and prescribe baseline technology standards for PAs and PGs.
Continue Reading FIG Papers (No. 5 : Series -1) : RBI Payment Regulations – 2009 to 2021: Bank ‘nodals’ to PA/PG licenses!
FIG Papers (No.4 : Series – 2): Indian Mutual Funds – New M&A Rules!
The Securities Exchange Board of India (“SEBI”) carried out a regulatory revamp exercise of SEBI (Mutual Funds) Regulations, 1996 (“MF Regulations”) and various circulars issued under it by way of a circular on mutual fund(s) (“MF”) issued on March 4, 2021 (“MF Circular”), effective from March 5, 2021, thereby streamlining a robust regime governing the reporting, compliance and disclosure requirements applicable to asset management company(ies) (“AMC”) and the trustee(s) of such AMCs.
Continue Reading FIG Papers (No.4 : Series – 2): Indian Mutual Funds – New M&A Rules!
FIG Papers (No. 3: Series – 1) : Indian Mutual Funds – M&A Wave!
The Securities and Exchange Board of India (“SEBI”) recently approved amendments to the SEBI (Mutual Funds) Regulations, 1996 (“MF Regulations”) at its December 16, 2020 board meeting, notified on February 4, 2021 through the MF Regulations by way of the SEBI (Mutual Funds) (Amendment) Regulations, 2021, with effect from March 5, 2021.
Currently, a Mutual Fund (“MF”) ‘sponsor’ is required to have a ‘sound track record’ i.e. having profits in 3 out of the last 5 years, including the fifth year. Recognising the role of emerging tech/ fintech companies in the Indian financial services space and to facilitate MF innovation/ geographic penetration, SEBI relaxed the above profit criterion for sponsors. Going forward, MF sponsors who do not meet the above, would still be eligible to, either set up a new, or acquire an existing, MF asset management company (“AMC”) and trustee company, if it has a minimum net-worth of INR 1 billion as contribution towards the AMC’s net-worth, which is required to be maintained till the sponsor makes profits for 5 consecutive financial years.
Continue Reading FIG Papers (No. 3: Series – 1) : Indian Mutual Funds – M&A Wave!
FIG Papers (No. 2) : RBI’s Revised Regulatory Framework for NBFCs : Industry Implications
Introduction
In the backdrop of recent stress in the financial sector, especially in the speciality finance (i.e. NBFC) space, the Reserve Bank of India (“RBI”) has sought to address potential systemic risks by issuing a discussion paper on ‘Revised Regulatory Framework for NBFCs – A Scale-Based Approach’ (“Discussion Paper”) on January 22, 2021. The apex bank, through the Discussion Paper, has introduced a scale-based approach to the regulation of non-banking financial companies. Owing to their growing significance, linkages with the banking and capital markets sectors, and complexity in operations, the Discussion Paper proposes a four-tiered regulatory structure for NBFCs, based on proportionality of the NBFCs.
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FIG Papers (No. 1) : RBI Working Group on Digital Lending – Policy Suggestions
The Reserve Bank of India (“RBI”), through a press release issued on January 13, 2021, has set up a working group on digital lending (“WG”), to study all aspects of digital lending activities in the regulated financial sector as well as by unregulated players so that an appropriate regulatory approach can be put in place.
The move is well-timed, given the recent turmoil witnessed in the Indian digital lending space, and comes on the back of the RBI’s December 23, 2020, public caution against unauthorised digital lending platforms/ mobile Apps and its June 24, 2020, Circular, prescribing Fair Practices Code for banks and non-banking finance companies (“NBFCs”) while sourcing loans or recovering dues through digital lending platforms.
Continue Reading FIG Papers (No. 1) : RBI Working Group on Digital Lending – Policy Suggestions