Union Budget 2017 Decoded: What’s in it for Startups?
People and Startups –All –Customary Blog
As a nation and as an Entrepreneur we had the expectations from this budget to be as revolutionary as the decision of the Demonetization of INR 500 and 1000 notes was! But much to our astonishment this budget came as balanced with no steep curves of subsidies and tectonic policy changes which could have further brought instability in the economic infrastructure of the Nation which has just breathing to return to normalcy, post Demonetization Drive.
The Thought Leadership and Intellectuals are still contemplating till they get the figures and facts in black in white to absorb, what it could bring? But this time certainly NAMO and his team did not bring the changes of the intensity which was expected out of their Zero Tolerance against Corruption and Good Governance perception. Yet a major roll to counter this was “Political Parties to now take payments greater than INR 2000 in cheque and not in cash” which entails the Political Will of the NAMO Cabinet to be against Corruption!
The FinTech Startups continues to cross leverage maximum from Budget and Government’s Policy Framework under Digital India.
Fintech organizations especially facilitating e-payments and mobile wallets like Paytm, Free charge, Citrus pay, Mobi Kwik, Razor pay are witnessing surge in the demand of their services due to Demonetization and they continue to do so in the coming years as the Government has laid greater emphasis to encourage Digital Transaction. Apart from the private players the Government is seeking more avenues apart to bring this change, not as a burden for the Non Smart Phone Users and Village Population, but as a boon to them!
Government is all set to Launch Aadhar Pay and promote BHIM App: As a Digital Drive the Government is working on the model to make payments through Aadhar Card named as “Aadhar Pay” which would be for People who are not using Smart Phones. Also the BHIM App will remain crucial and is going to push the UPI channel of digital transaction in the main stream of digital payments across the nation.
POS Terminals will continue to Increase and soon we will have POS terminals accepting Aadhar Cards: With the Learnings obtained during and after the Demonetization Drive across the nation, the Government has understood the need of POS Machine Terminals which shall be driving the major change. Hence the Government seeks to increase POS Terminals distribution primarily through Banks and then to Merchants. The Government is looking to further integrate “Aadhar Pay” in the POS Terminals to make it easier for Non Smart Phone Users to transact digitally.
Current Scenario of POS Terminals across India
Even if some population in the rural villages do use cards for ATM transactions, very few of them use it to pay bills online or over POS machines (1 out of 10 Card Holders). Now that 10% of the population would now have to seek POS machines which are still a rare find and only showroom owners have them. As per the media insights approx. 600 machines are available for 10 lakh consumers which is like searching needle in haystack.
- Gandhi, Deputy Governor, RBI, said during his speech at an event organized by National Payments Corporation of India in March last year “It was of critical importance that the population in over six lakh villages in the country is exposed to the alternate delivery channels. Some estimates indicate that to reach the average levels of BRIC countries, India will need 20 million (Point of Sale) PoS terminals as against the current 1.2 million. This is a tall order,” he said
New Payment Regulatory Board Under the Supervision of RBI to be formed to monitor digital payments.
With the recent fight over UPI payments not going through between ICICI and Phone Pe App, it was much needed as such issues with the Go Digital Drive in Indian Economy was eagerly awaited and shall deem fit to bring transparency for private players in the Banking Sector.
Brief Peek into the current Statistics of the some of the leading Fintech Startups in India.
Pasted MIS Quick Statistics
Mudra Yojana is doubled. Now the corpus amounts to INR 2.44 Lakh Crores: Mudra loan of Pradhan Mantri Mudra Yojana is a Government of India undertaking designed to meet the financing needs of non-corporate small business units of the country. The idea is to provide financial support for small business which employ majority of the Indian working population. The Funds allocated last year was approx. 1.22 Lakh Crores which the Government has doubled this time to INR 2.44 Lakh Crore and seeks to promote Rural and Semi Urban Startups to further upheld the Employment across PAN India.
EdTech Startups will see collaboration with Government over ICT platform.
Right from the year 2013, the government has been keen on to connect the Gram Panchayats across India by Broadband and special funds have been allocated this year to bring this as an enactment of the proposed policy. While the Government District’s offices will avail this opportunity, the government schools will also be incorporated to receive broadband connections over optical fibers to have Information and Communication Technology Infrastructure in place. As per the new budget 3479 Educationally Backward Blocks will get new ICT infrastructure.
This is a great opportunity for the Ed Tech Startups to collaborate with the Government and formulize education through ICT in coming times. With the content of the schools going digital many of the Curriculum and Education Startups will be sourced in to create newer content for ICT based Education in Government Schools.
Energy Sector will bloom
The subsidies in the Solar Panel and the LED drive remains to be the two important facets of the Energy related announcements for Private Players. The Government is encouraging the Startups and Companies to manufacture Solar Panels efficiently and with cheaper prices indigenously. A corpus of INR 1, 26000 Cr is secured in the budget for production based investments by the Government.
Govt will provide subsidy and loans to Micro Irrigation and Agriculture Entrepreneurs
The entire budget seems to have been placed around improving the much needed Agricultural sector which was welcomed from all thought leadership across the Country. Government has decided to provide subsidy and aids to Entrepreneurs who are venturing into Micro Irrigation and Agricultural reforms across India.
Recently we have seen some home grown Startups facilitating resources for Peasants and Farmers at much cheaper price to help them yield better profits and thus greater production. This sector would has also seen some great innovations by Startups which are striving hard to resonate with the lurching policies and aids to the much needed Farmers community in India. With this budget into action it is expected to improve.
Skills Development will continue to be a priority
Skill India Mission was launched in 2015 to bring in skills handy for the unemployed youth. While this was into existence yet was not impactful as majority of centers were owned privately and meant to be money minting machines under NSDC – National Skill Development Corporation. The Government has now decided to bring 100 India International Skill Centers across the Country to facilitate the change envisioned to bring more employments for youth, in India as well as abroad.
Emphasis on Swachh Bharat Abhiyaan and Bio Toilets in Railways
Swachh Bharat Abhiyan was again highlighted and first time ever after the year 1925 the Rail Budget was merged in the Union Budget. The Government centered its core objectives mainly around Infrastructure development to foster better Operations and Upgradations in the Technology Framework in Railways. Major announcements were.
No Service charge while booking tickets with IRCTC
Raksha coach with a corpus of Rs. 1 lakh cr fore five years (for passenger safety)
SMS based clean my coach service started
Coach Mitra facility – to register all coach related complaints
2019 – bio toilets for all trains
500 stations to be made differently-abled friendly
Railways will offer competitive ticket booking facility
New Metro rail policy to be announced with new modes of financing
Pic Courtesy: My Big Plunge
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