As Finance Minister Nirmala Sitharaman rises to deliver the Union Budget 2021-22 later today, India’s tech and start-up industry will look to the cues that will shape the post-pandemic future of their ecosystem.
Banner of the Budget
The Government has also made public its plan to bring a cryptocurrency bill during the current budget session, in the light of discussions on enabling pension funds and insurance companies to invest in Indian start-ups. Meanwhile, the Fintech industry expects more changes to further improve the country’s financial inclusion push in the middle of a boom in digital payments.
India’s cryptocurrency bill is putting the industry in a state of emergency
India’s blockchain developers and business leaders are pressing the alarm button as the central government prepares to prohibit private e-money trading ahead of the possible introduction of India’s official digital currency.
On Friday, the Center announced the launch of the Bitcoin and Enforcement of the Official Digital Currency Bill 2021 at the current budget session. It aims to pave the way for the potential launch of digital money by the country’s central bank at a time when China is testing a variant of its digital yuan.
Industry mavens, who welcome the government’s move, remain concerned about the clause aiming to outlaw all private cryptocurrencies while making some exceptions to help the underlying technologies.
Plan 2021 & Start-up Financing
Despite regulatory restrictions, Indian startups continue to earn 85 per cent of their funding from international investors. The government is seeking to change it.
Driving news: the government has begun talks on authorizing domestic insurance and pension funds to invest in Indian start-ups. Though the concept is not fresh, industry watchers agree that now is the best time for Indian institutional investors to become stakeholders in India’s start-up ecosystem.
Local institutional funding, as well as favourable laws and tax cuts, would curb the practice of ‘flipping’ among Indian startups, experts claim.
Budget 2021 and Fintech
Fintech is looking for a favourable Union budget of 2021-22 ahead of a critical year for India’s burgeoning digital economy when a large part of the country’s customers and small businesses are projected to follow digital means of accessing payments and financial resources for the first time.
Driving news: Finance Minister Nirmala Sitharaman is set to deliver a budget that tackles the needs to improve the economy destroyed by the pandemic. Industry experts said that reforms to further the country’s financial inclusion mandate through effective use of technology could be expected from the budget.
The disruptive progress shown by the fintech community in 2020 has strengthened the need for a more focused approach to maintaining growth and preserving consumer interest, the industry says.
How Young India got hooked on GameStop’s story
It was mainly through memes on subreddit forum r/wallstreetbets and Instagram Posts, but market watchers say that a GameStop-like occurrence is unlikely to occur in India.
Why it matters: for young Indians, GameStop’s short-term tightening and all that has followed in the United States since then—including the anti-establishment narrative that it has created, the halting of its trade-in Robinhood Markets, the discussion among policymakers about the impact of social media communities on financial markets—is like a refreshing lesson in understanding the market’s potential for them.
Fortunately, Rs 100 crore is raised in the first foreign funding
Happilo, a safe gourmet snacking brand, raised Rs 100 crore from A91 Investors to an undisclosed valuation in its first external fundraising round.
Why it matters: this investment is in the continuation of the success that D2C (direct-to-consumer) brands, which have carved a niche for themselves in the crowded Indian market, have seen in recent years. This has prompted venture capital firms to make a beeline to invest in such start-ups. Good snacking as a category has seen a significant rise, with the pandemic giving the industry a shot in the arm as a growing number of people take to healthy eating habits.
TCS, Wipro Bullish, India Company
Tata Consultancy Services Ltd. (TCS) and Wipro Ltd. saw good market growth from India, helped by higher technology investment from local customers as they became stronger after the pandemic disruption.
