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Pre-Budget Expectations: Leaders in Fintech, Real-estate, Cryptocurrency & Shipping & Logistics Share their Insights

India’s financial budget for the FY 2021-22 would be announced soon. India’s Finance Minister Nirmala Sitharaman has already given a hint about this year’s budget as a means to turning the tide on the economy that has been badly battered and bruised by the sagging labor market and COVID-19 induced slowdowns. We spoke to some of the leaders and entrepreneurs from leading Indian technology companies who have witnessed the economic slowdown from close quarters.

  1. Anand Kumar Bajaj, Founder, MD & CEO, PayNearby
  2. Mandar Agashe, Founder, MD & Vice Chairman, Sarvatra Technologies.
  3. Sudarshan Lodha, Co-founder, Strata property management
  4. Sumit Gupta, CEO & Co-Founder, CoinDCX
  5. Sanjay Bhatia, Co-Founder, Freightwalla

Pre-Budget Expectations: Leaders in Fintech, Real-estate, Cryptocurrency & Shipping & Logistics Share their InsightsThis is what each of these executives had to say about the upcoming Indian financial budget 2021.

Incentivize the Digital Ecosystem and Facilitate a Smoother Growth Trajectory Towards Innovation

Anand Kumar Bajaj, Founder, MD & CEO, PayNearby
Anand Kumar Bajaj, Founder, MD & CEO, PayNearby
Anand Kumar Bajaj, Founder, MD & CEO, PayNearby —

“PayNearby’s retail network has worked tirelessly to ensure seamless access to financial services, especially during the peak lockdown months last year. 93% of our business correspondent network has been committed to working in tier 2 and tier 3 towns, serving as the sole point of cash disbursal in locations with limited financial infrastructure. However, the commission rates for Blockchain (BC) services are very low to make it a profitable business. Additionally, BCs, by default, come under the 27% GST and 5% TDS on cash withdrawal even after the tax act having enabling provisions. This makes it difficult for them to stay afloat.”

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“We hope that this Budget takes into consideration the tough working condition of the BC network and make a few regulatory changes to ensure the viability of a community that has been vital to the cause of financial inclusion in the country. To continue sustaining the competitive advantage in Digital proliferation in India, restoring normal MDR on transactions will incentivize the digital ecosystem and facilitate a smoother growth trajectory towards innovation,” Anand added.

The POS Terminal Is Financially, Infrastructurally, and Operationally Far More Affordable and Far Less Demanding Than an ATM

Mandar Agashe, Founder, MD and Vice Chairman, Sarvatra Technologies
Mandar Agashe, Founder, MD and Vice Chairman, Sarvatra Technologies
Mandar Agashe, Founder, MD and Vice Chairman, Sarvatra Technologies 

“With the world’s largest immunization drive already underway, economic recovery will be the major focus of the government. Despite the wreck created, the pandemic has offered a huge impetus to digital penetration all throughout the country, which has accelerated in the unlock phase. It is therefore critical the budget draws out bold policy interventions to strengthen digital infrastructure which will eventually help in digitizing the overall economy.

The PoS terminal is financially, infrastructurally, and operationally far more affordable and far less demanding than an ATM.

However, with just 4 million POS machines active in the country, the budget should consider making devices such as the PoS terminal / mini ATMs’ the most viable acquiring infrastructure for banks and fintech companies by offering incentives such as a tax subsidy. Additionally, tax breaks in GST for merchants providing digital payments and tax benefits for companies helping build a digital infrastructure for friction-free digital onboarding too will catalyze the financial inclusion movement envisioned by the government.

The government should also consider a dedicated fund to strengthen the digital infrastructure of co-operative banks across the county which will offer a big boost to a more inclusive financial system. Budgetary concessions such as a GST waiver for digital transactions along with incentivization, especially in semi-urban and rural India will further augment cashless payments.

UPI has been a breakthrough, home-grown technology and it is important we replicate its success through newer and more innovative technologies. Fintechs and technology startups should be encouraged to invest more in R&D to introduce newer products and diversify into newer geographies. The upcoming budget should therefore consider offering tax benefits such as private investments being exempted.

Besides, considering the amount of data being created and stored across industries growing at unprecedented rates, enhancing the security infrastructure to protect and manage data seamlessly should be another focus area. In the post-COVID world, digital infrastructure will be a game-changer for companies and countries and therefore it is important we take timely measures to ride this wave.”

The Indian Government Should Also Consider Incentivizing Alternative Asset Classes Such as Warehousing, SEZs, Data Canters and Co-Working Spaces

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Sudarshan Lodha, Co-founder, Strata ---
Sudarshan Lodha, Co-founder, Strata
Sudarshan Lodha, Co-founder, Strata —

“Considering the real estate sector is the second-largest employer in the country and directly or indirectly, accounts for approx.10 percent of the GDP, it deserves serious attention in the upcoming budget. Within realty the commercial real-estate has been a watch-out sector for investors both overseas and back home owing to its strong fundamentals and resilience. The government should therefore consider measures to further encourage more NRI investments in the country. For instance considering a reduction in the income earned from long-term capital gains would be helpful.

Owing to fractional platforms, affordable commercial realty is now a reality in India and therefore for retail investors intending to invest in commercial assets, the government should consider a higher exemption limit. Alternatively since both the interest income as well as dividend earned by investors are taxable as per their slab rates, the government should consider a waiver of tax on dividend. These measures will help boost retail sale which in turn can offer a huge impetus to trade and economic activities. Considering personal loan is expensive, the government should also bring in a policy whereby retail investors can avail a loan seamlessly from banks at a reasonable interest rate for investment in commercial assets through fractional route.

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Besides, it is important to address investor sentiments while also addressing the challenges being faced by developers. For instance, considering a stress fund can help generate cash flow for developers thereby helping build the supply side of the industry.  Alternatively encouraging banks and NBFCs’ to lend to commercial real-estate projects or take over and restructure stalled projects will also go a long way in kick-starting the economy. Similarly, for properties that are not sold but developed for leasing, GST at 18 percent should be reconsidered as it is a huge liability for the developers as it pushes the cost of construction and poses further challenges in the wake of a liquidity crunch.

Additionally, the Government should also consider incentivizing alternative asset classes such as warehousing, SEZs’, data canters and co-working spaces to build momentum on both the demand and supply side.”

As Cryptocurrency Companies Look to Set up a Base in India, the Industry Expects Recognition


Sumit Gupta, CEO and Co-founder, CoinDCX

“Cryptocurrency has been emerging as one of the fastest-growing digital assets globally and India has seen tremendous traction building up following the supreme court lifting the banking ban. With growing awareness, there is growing consensus that cryptocurrencies will certainly play a crucial role in the way we deal with money and therefore it can positively contribute to the nation’s GDP. . At the moment, one cannot ignore the industry’s growth and the interest it has generated from the investors. In the past few years, the industry has generated thousands of direct employment in the country.

As more and more companies related to cryptocurrency set up a base in India, the industry expects recognition. A recognition can accelerate its contribution to the GDP and employment by multifold.  It will bring a trust factor not only for the retail investors but also for the institutional players. While there may be a delay in bringing in smart and sensible regulations for the sector recognizing crypto as a tradable commodity will be a significant relief. Further, to tackle AML & other funding concerns, the government should consider a formal direction to exchanges to follow the virtual assets guidelines of FATF.

Additionally, considering the ambiguity among investors pertaining to the tax applicability for the income earned from crypto trading, we expect the upcoming budget to bring in amendments in the income tax and GST laws thereby offering more clarity to investors, traders, and crypto organizations.”

Investments in Artificial Intelligence, Machine Learning, and Blockchain Technologies Can Facilitate Complete Transformation

Sanjay Bhatia, Co-Founder, Freightwalla
Sanjay Bhatia, Co-Founder, Freightwalla
Sanjay Bhatia, Co-Founder, Freightwalla

In the year 2020, the pandemic brought global industries to their knees. The USD 160 billion Indian logistics industry was also not spared as it came to a standstill during the pandemic lockdown.  The industry faced many challenges in terms of clearance, processing, and movement of shipments. Few technology-driven businesses managed to overcome some of the EXIM industry’s challenges during the pandemic. The stumbling-blocks faced by the exporters and importers could have been avoided if the entire ecosystem was working digitally.

There is a pressing need for a complete digital transformation of the industry to handle international shipments efficiently. Consider the case of customs that have taken part in their processes online. There are still many things that need to be re-molded with advanced technologies. We hope the union budget to announce suitable investments towards the digitization of the shipping and logistics sector. A leap towards the initiative will bring in transparency, reduction in cost, and better cost management. Digitization should also include implementing smart single-window clearance for smooth processing of shipments or approvals. Such initiatives will prepare us to tackle any untoward incidences in the future, like the current pandemic. Investments in Artificial Intelligence, Machine Learning, and BlockChain technologies can facilitate complete transformation. It can boost productivity in every sector, and style pretty effective and successful workflow

Further, the Union Cabinet recently approved a multimodal logistics hub proposal and set up industrial corridor nodes at Krishnapatnam and Tumakuru. We hope to see implementations of these at the earliest. It will facilitate the transportation of goods, thereby cutting travel time and making the system more efficient.

There is also an expectation that the proposed National Logistics Policy may get announced during the announcement of union budget 2021. We are optimistic that that will improve productivity and reduce logistics costs.

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