Sanjay Malhotra, Governor of the Reserve Bank of India, emphasised the pivotal role of fintech firms in extending formal credit to India’s micro, small and medium-sized enterprises, transforming financial inclusion and strengthening the country’s economic fabric.
Reserve Bank of India Governor Sanjay Malhotra said fintech firms are helping narrow the credit gap for India’s micro, small and medium-sized enterprises by extending formal lending to businesses that have long sat outside conventional underwriting models. Speaking at the opening session of the seventh Global Fintech Festival in Mumbai on Tuesday, he said the shift amounts to credit that can reach entrepreneurs at the far end of the economy, supporting jobs and livelihoods across the country.
Malhotra said the central bank has long seen fintech as a partner in shaping the financial system of the future. According to BusinessLine, he pointed to the past decade as a period in which technology has altered the way Indians bank, pay and borrow, with digital rails helping move financial services away from branches and into the hands of consumers.
He said that change is visible in everyday financial inclusion, with tools such as the Unified Payments Interface, Aadhaar-enabled payment systems and the Jan Dhan network allowing people across cities, towns and villages to transact, save and access credit more quickly and cheaply. The Financial Express reported that he described this as a reality for hundreds of millions of Indians, not just an aspiration.
The governor said the effect has been especially clear in MSME lending, where cash flow-based credit, the Account Aggregator framework and the Unified Lending Interface are expanding access to finance without relying as heavily on collateral. Business Standard reported in June that Malhotra had also urged banks and non-banking finance companies to use India’s digital public infrastructure, including tax and payment data trails, to deepen small-business lending.
Malhotra added that fintech’s benefits go beyond credit access. He said digital tools have improved customer experience, shortened account opening and settlement times, lowered transaction costs and strengthened fraud detection through artificial intelligence-based analytics. He also pointed to the RBI’s regulatory sandbox and Innovation Hub as signs of a broader effort to encourage responsible experimentation while keeping the financial system safer, more trustworthy, inclusive and efficient.
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