The companies will be supported through multiple funding avenues, says government
The Tamil Nadu government in its FinTech Policy 2021 has announced that a structured package of incentives would be extended to firms which have invested more than ₹50 crore and provided direct employment for 300 people or more over a period of less than 3 years, on a case-to-case basis.
The first five large FinTech firms shall also be eligible for a relocation incentive of 50% up to ₹10 crore during the policy period. The policy that was released by Chief Minister M.K. Stalin will be valid until December 2025. Operational guidelines and clarification would be issued from time to time.
The government has said that it would support FinTech firms through multiple funding avenues. For instance, around ₹5 crore would be earmarked from the Tamil Nadu Startup Seed Grant Fund created under the Tamil Nadu Startup and Innovation Policy 2018. Another ₹20 crore has been earmarked from the Emerging Sector Seed Fund through TIDCO/Tamil Nadu Infrastructure Fund Management Corporation (TNIFMC). This fund will be used to provide venture capital for supporting the early-stage financing requirements of eligible FinTech startups.
With a vision to transform Tamil Nadu into a leading global destination for FinTech firms by 2025, the State has announced single window clearance for them and said that it would set up a registry managed by the FinTech cell to track and monitor the progress of these firms.
Apart from this, the School Education Department will design online and offline curriculum and training, in vernacular languages for improving financial literacy among students, leveraging best practices from across the globe. The Tamil Nadu State Development Corporation (TNSDC) shall develop an Apex Skill Development Centre (APSDC) for banking, financial services and insurance (BFSI) which will offer courses on FinTech and serve as a centre of excellence. The APSDC will be established in a PPP mode as a special purpose vehicle with TNSDC and an industry partner.
Ramkumar Ramamoorthy, pro Vice-Chancellor, Krea University and past president of the Madras Chamber of Commerce and Industry (MCCI), who is now a part of the FinTech governing council set up by the government, said, “I am thrilled to see the importance accorded to refashioning the curriculum and syllabi in educational institutions, including establishing an Apex Skill Development Centre for skilling in Fintech,” he said.
According to the policy, the Tamil Nadu Industrial Development Corporation Limited will develop a FinTech city in Chennai with a built-up space of at least 1 million sq ft, in a phased manner. It shall largely be virtual, interconnected digitally with an iconic building in Chennai and other FinTech centres in tier 2 and 3 cities.