Finance Minister Nirmala Sitharaman on Friday called for a “collective global action” for effective regulation of ever-changing technology and tech-driven payment systems.
So far, regulators are only “catching-up” in regulating ever-evolving technology and hence there is no one point formula with which it can be regulated, she said.
Her comments also come against the backdrop of the government preparing to come out with legislation to regulate cryptocurrencies.
“Even as we are thinking about at a national level, there should simultaneously be a global mechanism through which we are constantly monitoring the movement of technology, so that whether it is your cryptocurrency, whether it is tech-driven payment system, data privacy, whether it is ensuring that data is used ethically…
“When you are looking at data as one of the revenue generating options, to regulate it will have to be a collective effort,” Sitharaman said.
Speaking at the InFinity Forum 2021, she said technology respects no physical borders and has the power to sweep through borders. “… It means that global action is the only way with which you can regulate effectively.” India is working on a new Bill on cryptocurrency which will take into account the rapidly changing dimensions in virtual currency space and will be brought in Parliament during the ongoing session, which will end on December 23.
The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, seeks to “create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India. The Bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses”.
Replying to a question on how regulation keeps pace with technology amid discussion on cryptocurrency in India, she said since these are evolving areas, there is no clear pointed answer.
“Regulation, both legislative and executive, … at least till now have only been catching up with technology and rapid movement of technology. So as long the executive and legislature are only catching up, you will never be on top of it. And with technology, I am not sure they (regulators) can ever be on top of this kind of situation, because it is ever changing and ever evolving,” Sitharaman said.
She said India has seen digital revolution for the past years and financial inclusion has achieved the social norms of empowering the poor.
“We don’t require brick and mortar bank branches to service clients, as smart phones in hands of people is providing a technological platform to be able to do banking service without any hitch,” she said.
India has 1.29 billion biometric Aadhaar identity, 1 billion wireless internet users, 700 million people who are using the internet on phones and 600 million smartphones, the minister added.