Considering that the Union Budget for 2022-23 is aimed at laying the foundation and drawing a blueprint to steer the economy over the next 25 years, it is one packed with growth opportunities for all sectors, businesses and workforce.
It continues to build on the vision set in the Budget of last year, 2021-22. Having set the tone of the year by showing ample strength and resilience, it is reassuring to know that India's growth is estimated to be at 9.27% this year and the highest amongst all economies.
Capitalising on the momentum that the fintech industry has built in the last few years, this year's budget focuses on inclusive development and financing of investments as two of the seven pillars. This has set a strong foundation for faster financial inclusion and expansion of the credit ecosystem.
The government's aim to push India towards 100% financial inclusion and enhance India's status as a digital economy is evident in this year's budget. A strong focus on financial inclusion by setting up 75 digital banking units in 75 districts and their plan to connect 1.5 lakh post offices to the core banking systems reiterates this.
At the core of it all lies education and the announcement of initiatives on education and skills development such as DESH-stack e-portal and the 'One class, one TV channel' that will help empower more suburban and rural citizens to get on board the digital bandwagon.
The introduction of Central Bank Digital Currency will also be a step towards boosting India's digital economy owing to its world-class digital payments system. Budget 2022 also focussed on digital currency with the introduction of the digital rupee using blockchain technology in 2023 which I believe will help in reducing financial and physical efforts required for money management.
Focus on small businesses
It was encouraging to see that the budget 2022 envisioned to support the MSME sector by providing credit facilitation of Rs 2 lakh crore along with extending Emergency Credit Line Guarantee Scheme to March 2023.
To bolster the startup and fintech ecosystem, we welcome the government's decision to establish thematic funds to promote and encourage sunrise sectors in India. With the introduction of thematic funds, where the share of the government would be limited to 20%, the Government of India has established a constant flow of capital for the sector, enabling it to innovate and grow, while at the same time generating wealth for investors.
Overall, it is great to see the kind of focus our Government has placed on the holistic growth of the Indian start-up economy. Many emerging sectors such as AI, Geospatial Systems and Drones, Semiconductor, Space Economy etc. have been identified as sunrise sectors this year and it would be interesting to see innovation and monetisation opportunities in these segments.
Proposing regulatory frameworks in VC/PE and even increasing tax incentives for startups from three years to four years of incorporation will surely be a relief for small businesses and the creator economy.
These are all empowering moves recommended for the sector in order to multiply growth in the coming years and to ensure that we emerge as a power-hub amongst other markets. Strong focus on digital banking and fintech if coupled with measures for ease of doing business should help give the much-needed thrust to already growing start-ups, particularly in the Fintech sector.
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Harshil Mathur is CEO and Co-founder, Razorpay.