Mumbai: Maharashtra on Tuesday became the first state in India to unveil a financial technology policy, aiming to establish a Global Fintech Hub in the Mumbai Metropolitan Region, and make the state one of the top five fintech centres in the world in the next five years.
The state cabinet on Tuesday approved the policy under which the government would facilitate establishment of 300 start-ups in this sector in the next three years and a venture capital fund of Rs200 crore for fintech start-ups.
Under the policy, Maharashtra government would make available at least 10,000 sq. ft of ‘co-working space’ at a central business location in Mumbai for fintech companies at subsidised rates. An official working at the chief minister’s office, who did not want to be identified, said the business district of Bandra Kurla Complex was “the most likely location" where this “incentivised co-working space would be provided" to fintech companies.
Last month, chief minister Devendra Fadnavis had told Mint in an interview that a core group of experts was working out a plan to develop an International Financial Services Centre in Mumbai that would house fintech, blockchain, and distributed ledger technologies and attract investment into this sector.
“Given the importance of fintech in the banking, financial services, and insurance sectors, Maharashtra needed a policy to establish a global fintech hub in Mumbai to leverage Mumbai’s natural advantage of being the financial capital," a press release issued by the chief minister’s office said.
Major incentives that the policy offers include facilitating a venture capital fund of Rs200 crore for start-ups, providing extra floor space index (FSI which determines permissible construction on a plot of land) for establishment of smart fintech centres, and putting in place a fintech corpus of Rs250 crore to help government achieve the objectives listed out in this policy.
“The policy talks about hand-holding of as many as 300 start-ups in this space and building an ecosystem that fosters innovation. We are looking at elite educational institutes, fintech accelerators, banks, financial services, and IT industry as potential partners under this policy," said the official cited above.
A fintech start-up with a turnover of at least Rs25 crore will be entitled to an annual assistance of Rs10 lakh for three years as reimbursement of internet and electricity expenses, goods and services tax, and expenses for participating in global exhibitions or similar events. The government would also provide assistance to establish fintech accelerators and incubators. To help develop the global fintech hub in Mumbai, the policy enables the government to create an industrial sandbox.
An advisory council comprising 15 outside experts would be created by the government to help the government steering committee implement this policy.