RBI Approves SRPA’s Application For Becoming A Fintech SRO

Fintech self regulatory organisation (SRO) Self-Regulated PSO Association (SRPA) has emerged as the third RBI-recognised SRO over a year after the apex bank floated an omnibus framework for recognition.

In a statement, the newly recognised SRO said that it represents a collective commitment of India’s leading payment system operators (PSOs) to foster a safe, secure, and compliant digital payments ecosystem under a collaborative co-regulatory model.

The SRO plans on operationalising its governance, compliance and supervisory mechanisms in alignment with the apex bank’s framework shortly after this. 

Fintech companies like Infibeam Avenues, Razorpay, PhonePe, CRED, Mobikwik, Mswipe, Open, among others are members of the SROs. Besides, the body claims that several other PSOs have also initiated their membership process and are expected to join the association shortly following this formal approval 

“We shall endeavor to play a pivotal role in aligning our members with regulatory priorities. This involves advocating for necessary changes and promoting an alliance and culture of compacting as a crucial conduit between industry players and the RBI. We shall also put in place a standardised transparent dispute resolution mechanism for resolving disputes amongst members,” SRPA director and Infibeam’s managing director Vishwas Patel said.

Prior to recognising SRPA, the RBI had recognised Shriram Finance president Umesh Revankar-led SRO Finance Industry Development Council (FIDC) in October. FIDC is a representative body of asset and loan financing of the NBFCs registered with the RBI. NBFCs like Ugro Capital, L&T Finance, among others, are a part of the SRO.

Fintech Association for Consumer Empowerment (FACE) became the first SRO to get the RBI recognition last year in August. With members like CASHe, Fibe, CRED, Groww, InCred, among others, FACE claims that its members account for 80% of digital lending business volumes.

Meanwhile, other SROs like the India Fintech Foundation (IFF) are also currently in the process of receiving the RBI’s approval. 

For context, a fintech SRO is an industry-led body which is responsible to oversee and standardise the conduct of fintech companies. Its goal is to promote responsible innovation, ensure consumer protection, and establish ethical and operational guidelines across lending, payments and other digital finance segments. 

The RBI proposed the set up of such Section-8 companies earlier in 2023 to bring accountability and standardisation to the rapidly expanding sector. In March 2024, the apex bank had issued an omnibus framework for recognition of SROs, outlining the roles and responsibilities of an SRO and other related objectives. 

With fintechs playing a key role in the country’s rapidly growing digital lending, payments and personal finance, concerns around data misuse, misselling, cyber risks and governance lapses have intensified. Such entities aim to create a structured, industry-driven framework for ethical conduct and consumer protection, setting behavioural and operational norms without stifling innovation.