Union Budget 2023-2024: Priority 7: Financial Sector

  • 01 Feb, 2023 |
  • 4:24 PM
  • “Our reforms in the financial sector and innovative use of technology have led to financial inclusion at scale, better and faster service delivery, ease of access to credit and participation in financial markets,” the FM said.
Focus areaMeasures announced
Credit Guarantee for MSMEs
  • The revamped credit guarantee scheme will take effect from 1st April 2023 through infusion of Rs 9,000 crore in the corpus.
  • This will enable additional collateral-free guaranteed credit of Rs 2 lakh crore.
  • Cost of the credit will be reduced by about 1%.
National Financial Information Registry
  • A national financial information registry will be set up to serve as the central repository of financial and ancillary information. This will facilitate efficient flow of credit, promote financial inclusion, and foster financial stability. 
  • A new legislative framework will govern this credit public infrastructure, and it will be designed in consultation with the RBI.
Financial Sector Regulations
  • To facilitate optimum regulation in the financial sector, public consultation, as necessary and feasible, will be brought to the process of regulation-making and issuing subsidiary directions.
  • To simplify, ease and reduce cost of compliance, financial sector regulators will be requested to carry out a comprehensive review of existing regulations. For this, they will consider suggestions from public and regulated entities. 
  • Time limits to decide the applications under various regulations will also be laid down.

To enhance business activities in GIFT IFSC, the following measures will be taken:

  • Delegating powers under the SEZ Act to IFSCA to avoid dual regulation,
  • Setting up a single window IT system for registration and approval from IFSCA, SEZ authorities, GSTN, RBI, SEBI and IRDAI, 
  • Permitting acquisition financing by IFSC Banking Units of foreign banks, 
  • Establishing a subsidiary of EXIM Bank for trade 
  • re-financing,
  • Amending IFSCA Act for statutory provisions for arbitration, ancillary services, and avoiding dual regulation under SEZ Act, and
  • Recognizing offshore derivative instruments as valid contracts.
Data Embassy
  • For countries looking for digital continuity solutions, government will facilitate setting up of their Data Embassies in GIFT IFSC.
Improving Governance and Investor Protection in Banking Sector
  • To improve bank governance and enhance investors’ protection, certain amendments to the Banking Regulation Act, the Banking Companies Act and the Reserve Bank of India Act are proposed.
Capacity Building in Securities Market
  • To build capacity of functionaries and professionals in the securities market, SEBI will be empowered to develop, regulate, maintain and enforce norms and standards for education in the National Institute of Securities Markets and to recognize award of degrees, diplomas and certificates.
Central Data Processing Centre
  • A Central Processing Centre will be setup for faster response to companies through centralized handling of various forms filed with field offices under the Companies Act.
Reclaiming of shares and dividends
  • For investors to reclaim unclaimed shares and unpaid dividends from the Investor Education and Protection Fund Authority with ease, an integrated IT portal will be established.
Digital Payments
  • Digital payments continue to find wide acceptance. In 2022, they show increase of 76% in transactions 
    and 91% in value. Fiscal support for this digital public infrastructure will continue in 2023-24. 
Azadi Ka Amrit Mahotsav Mahila Samman Bachat Patra
  • A one-time new small savings scheme, Mahila Samman Savings Certificate, will be made available for a two-year period up to March 2025. This will offer deposit facility upto Rs 2 lakh in the name of women or girls for a tenor of 2 years at fixed interest rate of 7.5% with partial withdrawal option. 

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