Fintech Companies - MUST READ

Happy Weekend everyone!

Today I am back with another weekly update for the Fintech Companies.

Covering updates in the regulatory or economic side of the Fintech market for Indian companies.

If you run a Fintech Company in India.

Or you plan on expanding your Fintech Company in India.

Then this becomes important for you.

Here are the main things that happened in the last week.

A) Emerging Trends

1) Sitharaman Urges Fintechs to Combat Cyberfraud

Call to Action:

• FM Nirmala Sitharaman urged fintechs to tackle “digital arrests,” cyberfraud, and deep-fake threats at the Digital Payments Awards, per KNN India.

• Praised UPI’s role in financial inclusion, with ₹44L Cr disbursed via DBT since 2014, saving ₹3.48L Cr, per her speech.

Global and MSME Focus:

• Highlighted UPI’s acceptance in 7 countries and fintech’s $400B market potential by 2028-29, urging MSME lending via “phygital” models, per the article.

• Stressed continuous innovation to protect vulnerable users and maintain trust.

Why It’s Significant:

• Signals fintech’s dual role in growth and cybersecurity.

• Encourages global expansion of India’s digital payment models.

2) Jio-BlackRock JV Gains SEBI Advisory Nod

Regulatory Milestone:

• Jio Financial Services’ 50:50 JV with BlackRock, JioBlackRock Investment Advisers, received SEBI approval on June 10, 2025, to operate as an investment adviser, per Economic Times.

• Follows May 2025 SEBI nod for mutual fund management, despite JFSL stock trading lower at ₹300, per Hitesh Sethia.

Strategic Plans:

• Aims to offer digital-first, insight-driven advisory services, leveraging BlackRock’s global expertise and Jio’s digital innovation, per Rob Goldstein.

• Appointed Marc Pilgrem as CEO, with 25+ years at BlackRock, to lead the venture.

Why It’s Significant:

• Democratizes access to world-class financial advisory in India.

• Strengthens Jio’s fintech portfolio amid growing investor demand.

3) Aspora Raises $53M for NRI Banking

Funding Success:

• London-based Aspora raised $53M from Sequoia, Greylock, and Quantum Light Ventures, totaling $93M in six months, per Times of India.

• Founded in 2022 by Parth Garg, serves 250,000 NRIs, primarily in UAE, with $2B+ transaction volume, saving $15M in fees.

Expansion Goals:

• Offers zero-fee UAE remittances and market-rate forex, planning US launch in July 2025 and Canada, Australia, Singapore by year-end, per the company.

• Backed by investors like Balaji Srinivasan and Sundeep Jain, targeting global Indian diaspora.

Why It’s Significant:

• Enhances cross-border banking for NRIs, reducing costs.

• Positions Aspora as a leader in diaspora-focused fintech.

4) Saswat Finance Secures $2.6M for Rural Fintech

Funding Details:

• Mumbai-based Saswat Finance raised $2.6M from Ankur Capital and Incubate Fund Asia to expand rural financial services, per Economic Times.

• Funds will enhance tech, new products, and operations in Maharashtra, Karnataka, and Uttar Pradesh, per Ravi Ranjan Chaudhary.

Business Model:

• Founded in 2022, focuses on dairy sector with ₹55 Cr in loans and 6,000+ customers, using alternative data like milk production, per Arun Tiwari.

• Partners with Amul, RBL Bank, and Iffco Tokio to offer cattle loans and insurance.

Why It’s Significant:

• Bridges financial access gaps in rural India, leveraging digital transformation.

• Addresses literacy and infrastructure challenges with tailored products.

B) Economic Highlights

1) Paisabazaar Launches Loan Against Car

New Offering:

• Paisabazaar partnered with HDFC Bank, Tata Capital, and others to offer Loan Against Car, expanding its secured lending portfolio, per CNBC TV18.

• Provides up to 200% of car value with 5-year tenures, fully digital, per Santosh Agarwal.

Strategic Goals:

• Targets consumers with limited credit access, aligning with home and property loan segments, with 65+ lender partnerships and 20L monthly inquiries, per the company.

• Aims to build an inclusive credit ecosystem for diverse segments.

Why It’s Important:

• Enhances credit availability through innovative secured loans.

• Strengthens Paisabazaar’s role in digital lending markets.

2) plutosONE’s Bharat-Centric Fintech Inclusion

Market Insights:

• India’s digital payments shifted from urban to national, driven by UPI, BBPS, and policy support, per plutosONE’s Rohit Mahajan in Elets BFSI.

• plutosONE’s AI-powered BBPS platform targets 50,000 merchant onboardings in a year, reducing integration time, per the interview.

Rural and NBFC Focus:

• Offers WhatsApp-based BBPS collections and vernacular interfaces to reach tier 2/3 and rural areas, supporting NBFCs with digital collections, per Mahajan.

• Enables NBFCs to adopt co-lending and embedded finance, enhancing inclusion without heavy CapEx.

Why It’s Important:

• Empowers rural financial access with interoperable, trust-based solutions.

• Positions plutosONE as a key enabler for NBFC digital transformation.

3) UPI Transactions Speed Up to 10 Seconds

Technical Upgrade:

• NPCI mandates UPI transactions to complete in 10-15 seconds from June 16, 2025, down from 30 seconds, per Adda247.

• May 2025 saw 1,868 Cr transactions worth ₹25.14L Cr, prompting faster response times, per NPCI circulars.

User Enhancements:

• Limits balance checks to 50/day, displays only final beneficiary names, and bans name edits to curb fraud, with compliance by June 30, 2025, per the article.

• Aims to reduce failures and boost trust in digital payments.

Why It’s Important:

• Enhances UPI’s efficiency, reinforcing its role in India’s cashless economy.

• Strengthens user confidence with anti-fraud measures.

C) Business Developments

1) POP Raises $30M from Razorpay for Loyalty Ecosystem

Funding Milestone:

• Fintech POP secured $30M from Razorpay to expand its loyalty-first UPI payments model, per Business Standard.

• Handles 6L daily UPI transactions, 1M monthly active users, and 13.5M transactions in May 2025, ranking 21st on UPI leaderboard, per Bhargav Errangi.

Strategic Plans:

• Funds will drive product innovation, rewards, and D2C/lifestyle merchant partnerships, reducing customer acquisition costs via POPcoins, per Harshil Mathur.

• Issued 40,000+ RuPay credit cards with Yes Bank, focusing on long-term retention, per the company.

Why It’s Notable:

• Bolsters Razorpay’s B2C presence, enhancing D2C merchant loyalty tools.

• Redefines UPI rewards with a sustainable, habit-building model.

2) String Metaverse Secures Canadian Fintech License

Regulatory Achievement:

• String Metaverse, rebranding to String Payx, received a FINTRAC Canada MSB fintech license, per UNI India.

• Enables Web3 digital banking, including virtual Visa/Mastercard debit cards, crypto-to-fiat ramps, and cross-border transfers, per CEO Santosh Althuru.

Market Positioning:

• Serves 4M gamers, targeting 10M, with cards integrated into Apple/Google Pay for 170M+ merchants, per the release.

• Aligns with blockchain-based financial ecosystems for stablecoins and tokenized assets, per the company.

Why It’s Notable:

• Merges gaming, crypto, and fintech for global Web3 payments.

• Expands String’s digital finance infrastructure internationally.

3) Data Sutram Raises $9M for BFSI Fraud Detection

Funding Success:

• Jadavpur University-founded Data Sutram raised $9M in Series A from B Capital and Lightspeed India, per Telegraph India.

• Provides AI-driven fraud detection and compliance for BFSI clients like HDFC Bank and Axis Bank, per CEO Rajit Bhattacharya.

Industry Impact:

• Addresses ₹36,014 Cr in FY25 digital fraud, up from ₹12,230 Cr, using 250+ data sources for cyber risk reduction, per RBI data.

• Moved to Mumbai in 2021 to access BFSI decision-makers, enhancing trust and talent, per Bhattacharya.

Why It’s Notable:

• Tackles rising digital fraud in India’s BFSI sector with AI innovation.

• Strengthens regulatory compliance for major banks and insurers.

D) Regulatory Insights

1) RBI Issues ETP Master Directions 2025

New Framework:

• RBI’s June 16, 2025, Master Directions regulate Electronic Trading Platforms (ETPs) for securities and derivatives, excluding offshore ETPs, per RBI website.

• Requires Indian incorporation, ₹5 Cr net worth, and robust tech infrastructure with pre/post-trade controls, per the directions.

Regulatory Gap:

• Omits offshore ETP oversight, unlike 2024 drafts, despite RBI’s 2023 ‘Alert List’ for unauthorized forex entities, per the article.

• Mandates data sharing with RBI if authorization is canceled and specifies reporting formats, per the framework.

Why It’s Important:

• Updates 2018 ETP rules to align with market integration and tech advancements.

• Leaves offshore ETP regulation unresolved, impacting forex oversight.

2) RBI Proposes Rupee IRD Draft Directions

Draft Update:

• RBI’s 2025 Draft Master Directions for Rupee Interest Rate Derivatives (IRDs) revise 2019 rules to reflect new products and non-resident participation, per RBI website.

• Allows non-residents to trade IRDs via authorized central treasuries or group entities, per the draft.

Compliance Enhancements:

• Rationalizes reporting to reduce burden and proposes global IRD transaction reporting for transparency, with feedback due by July 7, 2025, per the article.

• Addresses market developments like new derivative contracts and indices, per RBI’s review.

Why It’s Important:

• Modernizes IRD regulations to support market growth and global participation.

• Enhances transparency with streamlined reporting requirements.

3) Fino Payments Bank Fined ₹29.60 Lakh

Penalty Details:

• RBI imposed a ₹29.60 lakh fine on Fino Payments Bank on June 6, 2025, for breaching payment bank balance limits, per RBI website.

• Based on 2024 inspection findings, the bank exceeded end-of-day balance caps on multiple occasions, per the order.

Context:

• Penalty addresses compliance lapses under the Banking Regulation Act, not customer transactions, with potential for further action, per RBI.

• Follows supervisory evaluation as of March 31, 2024, per the notice.

Why It’s Important:

• Reinforces RBI’s oversight of payment banks’ regulatory adherence.

• Ensures operational discipline in India’s digital banking sector.

I hope this was useful to you guys working in the Fintech Space.

The fintech space is everchanging, so staying up to date with information will help you make smart decisions for your business.

Again, If I see any notable changes or updates on the Fintech Side during the week, that can help Fintech Companies, I will compile them.

And then share them on the weekends!

Btw - I run a legal firm that's a one-stop solution for Fintech Companies in India.

Whether you are starting out in India, or expanding to the Indian market, DM 💬 me if you need legal help with:

1) Business Registration

2) Contract Drafting or Review

3) Compliance

4) Answering any legal questions

See you tomorrow with another Newsletter now.