The growth of digital lending fintechs, who act as service providers for customers or banks, will increasingly emerge as critical pieces in the financial sector, said Shaktikanta Das, the Governor of the Reserve Bank of India (RBI). Speaking at the Times Network India Economic Conclave 2021 on Thursday, Das said these platforms need to be mindful about financial sector stability implications, cyber-security risks, customer protection and data protection aspects of their business. Das said that the massive growth in both digital payments and digital lending platforms requires the financial sector to upgrade their IT systems to handle the "exponential surge" in transactions. The fintech market in India is expected to reach Rs 6 lakh crore by 2025 from Rs 1.9 lakh crore in 2019, the Governor said. "In a world where the FinTech companies are leading in terms of the volume of digital transactions and playing a more active role in the banking and finance industry, it is important that the commercial banks adapt to the technological changes and work in tandem with these entities so that in future they are part of the ecosystem rather than competing with Fintech companies for business. A meaningful collaboration and co-existence in providing affordable and efficient value-added services would help both the worlds." — RBI Governor Shaktikanta Das Das said that the banking industry will be dominated by large banks and mid-sized banks in the decades to come, while smaller private sector banks, small finance banks, regional rural banks and co-operative banks will…
