digilocker: Boost for fintech innovation: Govt expands scope of Digilocker, sets up AI centers, streamlines KYC, says FM

In what will facilitate innovative fintech services, the government is expanding the scope of Digilocker to allow more documents to be made available to individuals, micro-small and medium enterprises and charities, Finance Minister Nirmala Sitharaman said while presenting the Union Budget 2023-24.

“The regulators in the financial sector will also be encouraged to have a KYC system that is fully available to meet the needs of digital media,” she said while delivering her budget speech on Wednesday.

In line with this, Sitharaman said that a one-stop solution will be introduced for reconciliation and updating of identity and address of individuals maintained by various government agencies, regulators and regulated entities will be established using DigiLocker and Aadhaar.

She spoke about the National Data Governance Policy which will bring in innovation and research from startups and academia. Sitharaman said this will provide access to anonymized data.
In addition, she said the KYC process would be simplified and a risk-based approach would replace a one-size-fits-all approach.

“Three Centers of Excellence for artificial intelligence will be set up in educational institutions and leading industry players will collaborate to carry out interdisciplinary research.” “(The centers will be) to realize the vision of Make AI in India and make AI work for India,” she said.

These centers will focus on developing cutting-edge applications and scalable problem-solving in the areas of agriculture and sustainable cities and will stimulate an effective AI ecosystem. Furthermore, the finance minister announced an agricultural accelerator fund in an attempt to promote agriculture among young people. She said that this fund would be created to encourage agri start-ups by young entrepreneurs.

“A digital public infrastructure for agriculture will be built as an open source, interoperable public good. This will enable inclusive farmer-centric solutions through relevant information services for planning and health, improved access to farm inputs, credit and insurance assistance for crop estimation, market intelligence and support for growth of agritech industry and startups,” she said.

Sitharaman said the government’s vision for “Amrit Kaal” includes a technology-driven and knowledge-based economy, with strong public finances and a robust financial sector.

“To achieve this ‘janbhagidari’ through ‘sabka saath, sabka prayaas’ is essential,” she added. As part of the government’s continued focus on the technology sector, Sitharaman said a number of measures were introduced to unlock the potential of the economy.

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