The Indian alarm on Big Tech

The Reserve Bank of India (RBI) has published its periodic Financial Stability Report including among the outstanding issues, together with the risks related to the climate, cyber attacks and increased competition resulting from the entry of fintechs, the invasion of Big Tech in the financial services industry. Defining it as a real challenge for banks. The issue is complex because large tech multinationals such as Amazon, Apple, Google, Facebook, Microsoft, Alibaba and Tencent, as well as owning a well-known brand linked to their core businesses that allows them to establish a solid relationship with a broad base of consumers, have considerable financial liquidity, as well as an impressive technological structure capable of offering low-cost services. In short, according to the report, Big Tech are expanding their footprint in digital financial services, including payment systems, crowdfunding, wealth management, banking and insurance services. Amazon offers credit delivery, payment services, crowdfunding and insurance services, while Google, Apple and Facebook all offer payment systems, Google in particular is expanding into the banking sector. In China, Alibaba’s Ant Group, Baidu, JD.com and Tencent provide banking, credit access, payments, crowdfunding, wealth management and insurance. The Indian central bank argues that while the services of many fintechs support financial inclusion and somehow encourage competitiveness among banks, the tech giants do not operate on an equal footing with banks and also generate political problems. The major concern is that technology companies operating as financial services do not have sufficiently clear governance structures, have dominant economic availability, and can leverage their network to expand the provision of financial services in a manner deemed unequal. The organization pushes for specific regulation on Big Tech, especially in financial matters, and affirms the need for international rules and standards for the digital economy that goes global. India recently tightened the reins of tech companies: last week, the government has proposed to ban ecommerce sites that sell own-brand products and the Indian Competition Commission has launched an antitrust investigation into Google’s smart televisions. Last month, the Indian government ordered Twitter to stop both offshoring and outsourcing of its operations on pain of forfeiting the country’s legal safeguards. The social media company may no longer have immunity to content posted by third parties on its platform, although the court has yet to finally rule on the matter. Twitter could therefore potentially be held legally responsible for any content users post on the platform, following failure to comply with the new information technology rules that went into effect in May of this year. The rules require any social media company to define three roles in India: a compliance officer who makes sure the platform follows local laws, a complaints officer, and an officer available for Indian law enforcement around the clock. , 7 days a week.