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Fintech eco-system is moving to blockchain and AI: Rajat Gandhi, Faircent

“A regulatory ring fencing is needed to tell the players the area in which they can play.”

ET Now|
Updated: Apr 02, 2018, 01.54 PM IST
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ET Now
Rajat-gandhi
We cannot expect the regulator to be the innovator. Our approach should be - you innovate, go to the regulator, be transparent.
Speaking on the sideline of the ETMarkets Global Summit 2018, Rajat Gandhi, Founder & CEO, Faircent.com, says they enable people and retail lenders to lend as little as Rs 750 and that requires cutting-edge technology.

Edited excerpts:

A lot of players have come into the fintech space. There are wallet players, then there are PPI, P2B, crowdsourcing and other payment players as well. So, regulation is one of the key challenges the private players are going through. What is your take on it?

Surprisingly, the Indian regulators, I would say, are strict. You can see the example of NBFC P2P licences regulation. It is a good rule-based model. In fact, the players themselves were pushing for some kind of regulation because financial markets need them. It’s not like e-commerce or running a taxi where the risks are not that high.

In financial markets, we believe regulation is an integral part of the whole ecosystem primarily because of the missteps that happen and serious players get more affected than the fly-by-night operators. So, you do need it. I would not say the regulations are very strict but at least a regulatory ring fencing is needed to tell the players the area in which they can play.

One thing we have to remember is that we cannot expect the regulator to be the innovator. Our approach should be - you innovate, go to the regulator, be transparent, tell them this is the innovation you are doing. How you are creating an impact for the society, for the customers, what is the value addition you are doing, etc. They are ready to listen to people -- whether it is the minister of finance, RBI or Sebi. This is what our experience has been. They have been taking inputs.

What is the scope of new technologies like AI and blockchain in the capital markets? Do you think there is enough scope for innovation in Faircent, which is a P2P lending marketplace? Or do you feel the old formula works best?

There is nothing called old formula in our business. It is totally new. What we are doing is the next generation of business. The last big thing that came from fintech was wallets and payments. We are a layer above that. So we are a layer above the data, the payments and everything. We enable people and retail lenders to lend money as small as Rs 750 and that requires cutting-edge technology. Peer-to-peer (P2P) is next level work and one needs a trusted platform for that.

We have lots of data on which an AI is created. Then we need to create a trusted platform and what better than blockchain? This is where we see the whole ecosystem moving. It is a natural progression for us. How much and when is the question, we have to answer, not whether we will we do it or not.
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