GFF 2026: RBI Governor Says Fintech Is Bridging India's MSME Credit Gap and Driving Financial Inclusion

Fintech has fundamentally reshaped India's financial system and is helping extend formal financial services to millions of people and small businesses, Reserve Bank of India Governor Sanjay Malhotra said on Tuesday. Addressing the inaugural session of the Global FinTech Festival 2026 in Mumbai, Malhotra said fintech had transformed the way Indians access banking and financial services, while improving efficiency and reducing costs across the financial system. Fintech takes banking to every citizen 'Over the past decade, fintech has fundamentally reshaped the architecture of Indian finance. It has taken banking from the branch to the hand of every citizen,' Malhotra said. He highlighted the role of digital public infrastructure such as the Unified Payments Interface (UPI), Aadhaar-enabled payment systems and the Jan Dhan ecosystem in expanding access to financial services. 'Today, a shopkeeper in a small town, a farmer in a remote village, a young professional in a metro city all transact, save, and borrow through the same seamless digital rails,' the Governor said. According to Malhotra, fintech has helped turn financial inclusion from 'a policy aspiration' into 'a lived, everyday reality for hundreds of millions of Indians'. 'Fintech is the bridge that connects our vast, diverse population to formal finance faster and affordably,' he said. The Governor said the impact of fintech has been particularly significant in credit delivery to micro, small and medium enterprises (MSMEs). 'Perhaps, nowhere is the impact more tangible than in the credit delivery to our Micro, Small and Medium Enterprises,' Malhotra said. He pointed to cash-flow based lending, Account Aggregators and the Unified Lending Interface (ULI) as tools helping fintech firms extend formal, collateral-light credit to small businesses. 'Fintechs are helping bridge India's MSME credit gap by extending formal, collateral-light credit to millions of small businesses,' he said, adding that such credit was reaching the 'last mile of enterprises' and supporting jobs and livelihoods. AI improving financial infrastructure Malhotra also highlighted the role of technology in improving customer experience and the efficiency of financial infrastructure. He said fintech has helped in 'reducing account opening and payment settlement times, cutting transaction costs' and 'strengthening fraud detection through AI-driven analytics', while also enabling real-time supervision. The RBI Governor said the central bank would continue to work with the fintech sector while promoting responsible innovation. 'The Reserve Bank has consistently viewed fintech as a valuable partner in building the financial system of the future,' he said. He cited the RBI's Regulatory Sandbox, Reserve Bank Innovation Hub and structured dialogue with startups and fintechs as part of its approach to fostering innovation. 'We have encouraged self-regulation within the sector,' Malhotra said. 'We have promoted responsible innovation while safeguarding trust that is the very foundation of finance.'