Budget 2018 has to take many positive steps towards aiding India’s smooth transition into a digital economy. With the constant sophistication of the cybercrime owing to the massive digital advancement and the government stressing towards digital payments, we could expect an overall digitization budget following the significantly intensifying number of cases of cybercrimes and data breaches. We can certainly expect cybersecurity to be a key agenda for the government this year.
Keith Martin, Head, Asia Pacific, Corporate Business, F-Secure
Budget 2018: In ease of doing business much more needs to be done
Reforms to help business grow which consequently will lead to increase in jobs. Though we have made some progress in ease of doing business much more needs to be done as there are still too many procedures and too many permissions from multiple authorities. We need more and faster action. Reducing taxes will help as will making GST compliances easier and less cumbersome. For small business we need urgent and immediate action to make it easier and simpler. It is far too complex and confusing for them. We need to simplify compliances and as if jobs are to be created then we need to make it easy for new businesses to be incubated. Indians are good entrepreneurs and we need to unleash this potential instead of shackling it. Also, far greater investment in education, health and infrastructure will help as these have been neglected for too long. The problem that needs to be tackled is to make our youth employable which is just not happening today. Most of the educational institutions are producing unemployable youths and the regulatory authorities are hindrances to growth and employment generation instead of being proactive and helpful. Our syllabuses and rules and regulations are outdated and serve no purpose. Let this be a game changer budget rather than more of the same as this is an opportune time to think big.
Ronesh Puri, MD, Executive Access – Executive Search Firm
Budget 2018: Government must push tech innovation
Ours is a country that has realized the significance of digitization and acted on it. The demonetization act set the wheels rolling in a big way for Digital India and the growth of digital payments has accelerated since then. However, there is still a large section of population, especially from rural areas, who are unable to get the best out of these digital initiatives. Fintech players are coming up with interest innovations to support regional languages, voice based transactions and AI powered natural language processing to facilitate financial inclusion. With the 2018 fiscal budget, we expect the government to take more active steps in encouraging such innovations.
Sundararajan- Executive Director, i-exceed
Budget 2018: Government needs to push India’s digital lending industry
India’s fintech space has witnessed a considerable push in the last couple of years, owing to the strong, proactive policy level support from the government. Although, initiatives such as Jan Dhan Yojana, Aadhaar and the emergence of UPI has provided a good foundation for FinTech companies to cover the ‘last mile’ touchpoints, there needs to be substantial governmental push to boost India’s digital lending industry.
Budgetary measures such as push towards e-signature usage to verify the documents digitally, e-KYC and to ensure there is a complete paperless on-boarding of accounts; Increasing the limits on affordable housing and providing regulatory support to fintech organisations trying to simplify and digitize easy credit access to MSME industry, will not only help develop the financial infrastructure of the country but also strengthen the eco-system in order to take India to the next stages of Financial inclusion.
Manav Jeet MD and CEO, Rubique
Budget 2018: Government must clarify Adv Pricing Agreement
The industry is still reeling under the APA (Adv Pricing Agreement) leading to confusion around the double taxation component of transfer pricing. We are looking for further clarity on this. Further, the development centres are looking for a more favourable deduction of Section 35 (2AB) to further India’s image as and R&D capital. On the startup fronts, local governments have set the precedent for bolstering innovation and entrepreneurship, and conditions like angel tax for domestic investors being higher than foreign investors must be relooked at. The government can also heed to IT association’s requests to set up a more central initiative around new tech reskilling, as there are initiatives being undertaken by organizations who find it feasible.
Suman Reddy, MD, Pegasystems India
Budget 2018: MSME’s need support from the government to help them scale-up
India has 10 to 15 million service MSME’s who run a wide variety of businesses. Across coaching & training services (school tuitions, computer training, job training, entrance exam coaching…) or home/business services (catering, pest control, security guards, interior decoration, architect…), our lives are impacted by tens of such small businesses who help consumers in most of the metro cities. Most of these MSME’s have 1 to 5 employees and face 3 key challenges in growing their businesses – financial (funding, credit…), customer acquisition (acquiring new customers, retaining existing ones…) and regulatory compliance (forms, taxes…). While large organizations can rely on multiple experts to solve all three aspects, MSME’s need a lot more support from the Government to help them scale-up. Budget 2018 can help MSME’s in these two aspects:
Help provide uncollateralized credit:
While lot of fintech organizations promise small-ticket personal loans, the ability to provide loans in the region of Rs. 2 to 10 lakhs using little collateral is beyond the ability of startups. The Govt. can aid in scaling up business loans for service MSME’s.
Reducing or removing GST on promotional spends:
Most MSME’s may come under the GST composition scheme that has business turnover limit of Rs. 1.5 crores currently. Budget 2018 can look to see if marketing and promotional spends done by such entities are fully exempt from GST. This will help them to further invest and grow their business.
Once MSME’s cross this limit, they can easily start paying the additional 18% tax and grow their business further.
Satya Prabhakar, Founder and CEO, Sulekha
Budget 2018: Infrastructure boost to increase economic potential
We share an optimistic outlook from the policy makers, especially after the DIPP approval. Some amendments that we look forward to would be to improve the ease of doing business, to have government involvement in setting up ground infrastructure that serves as the base on which everyone can build upon, improve education to make more of the youth productive, as well as better electricity and internet access to the millions of Indians moving up the economic ladder. We operate a number of our facilities in semi-rural or rural areas and some of these infrastructure and workforce improvements will benefit us as well as the ecosystem.
We work with a lot of farmers and people in the agriculture sector and I think an infrastructure boost will not only increase their economic potential, but help us overall in reducing waste and inefficiencies that contribute to inflation. Some things that would help us in particular is better support for farmers – knowledge, steady water and electricity supply, supply chain improvements to improve the quality of produce reaching markets. Grofers operates collection centers in rural areas to help farmers get to market quicker with their product and getting a better return out of it. If the Indian government works on the ground infrastructure and workforce support, Indian startups can build on top of that to fulfil India’s great promise.
Albinder Dhindsa, Co-Founder and CEO, Grofers
Budget 2018: Government needs to establish a startup Bank like SBA in the US
The Indian government has done great work with the Atal Innovation Mission and Atal Tinkering labs which have focussed on grants to educational institutions, however, to accelerate commercialization, they need to partner with private for-profit incubators and accelerators. For any budding entrepreneur, access to capital is the most critical factor to success. The government needs to establish a startup Bank like the SBA in the US and allow equity crowdfunding to ease the flow of equity capital and credit to entrepreneurs and start-ups.
Ishan Singh, CEO & MD RevStart, Active Angel Investor.
Budget 2018: Invest in high-end technologies like AI, Blockchain
The government is looking to invest in high-end technologies like AI, Blockchain, and the Digital India initiative, which are welcome moves. Doing so will help create the infrastructure and build a robust economy that can help India and its nimble new-age startups and speed up the digitization of businesses.
Anurag Avula, Co Founder and CEO, Shopmatic
Budget 2018: Digital India and GST to push growth
As a fintech service which has data and technology in its core, the GST did not impact us directly; but this unified tax with and the recent systemic changes would bring about a much-needed digital push and increased accountability. We hope in the year ahead that the Digital India initiatives along with the GST which functions entirely online would bring about a shift in mindset and increased digital adoption,”
Ranjit Punja, CEO & Co-Founder, Creditmantri.com
Budget 2018: Government should provide adequate tax incentive to P2P Industry
We expect the Government will continue with it’s focus and thrust on the digital India programme in the coming Financial Years. P2P industry has vast potential to support and provide financial inclusions of the masses, who are currently deprived of the adequate financial support (Loans) for their Personal and Business needs. As P2P industry is in its nascent stage, we expect Government to provide adequate tax incentive to the lenders to encourage large number of investors (Lenders) to join in for lending through these platforms to provide Financial Support (Financial Inclusions) of the people deprived of credit.
Surendra Kumar Jalan – Founder and CEO, OML P2P
Budget 2018: Government should not give unnecessary loan freebies to Agro or MSME sector
As we approach for the budget this year, one of the primary suggestions would be that the government should continue its firm stand on not allowing unnecessary loan freebies to the Agro or MSME sector. Passing on such freebies destroys the credit discipline and rewards the offenders, and thus indirectly punishes the diligent loan repayers.Further, the regulatory rules governing the fintech businesses need to be finalized on priority. Last year has seen these go through discussions and consensus building. This year should see the rules formalized into policy pronouncements. The focus of the regulators should be to enlarge the reach of organized lending, especially in bringing the excluded parts of the economy into the fold of organized lensing. Fintechs are, and will, play an important part in achieving this objective.
Sanjay Sharma- MD and CEO, Aye Finance
Budget 2018: Budget must emphasize on usage of IndiaStack
Fintech companies in India are hoping that the upcoming budget emphasize on usage of IndiaStack, which would help end consumer apply for a loan with a click of a button. With sustained push towards a digital first economy, government can truly promote financial inclusion.
Aditya Kumar, CEO & Founder, Qbera.com
Budget 2018: There should be no place for Angle Tax
We find Angel Tax very contradictory to government’s push for Start Up and a matured market place transaction. In a fair transaction both Investor and Start Ups are free to negotiate a price point for investment and the same are guided by demand-supply principal. We see no place for IT Department to penalise a good negotiator. On the other hands, when the economy is crying for capital investment & job creation, startups are doing exactly the same with the help of Angel or Seed Stage investors. Why to penalise them? If we cannot give them a Good Job Done Card, then atleast we should keep them away from trouble.
Satyam Kumar- CO-Founder and CEO, Loantap.in
Budget 2018: Lower the income tax rates for businesses
With Demonetization and GST, the Govt has given a great boost to digital transactions and availability of financial records for Small business which is likely to provide a big boost in the coming years. This agenda can be enhanced by encouraging the Small Businesses with tax benefits for conducting digital transactions as this will build a strong foundation for sustainable Small Businesses. The overall expectation from this budget is also around lowering of income tax rates for businesses and professionals to encourage wider taxation coverage similar to the drive for increasing coverage in indirect taxes.Given the growth in Fintech, it will be a welcome move if the govt. also creates some schemes to encourage budding Fintech entrepreneurs e.g. creation of Fintech Parks where space, high speed internet, basic admin facilities can be provided.
Manish Chaudhari, Co-Founder and CRO, CoinTribe.