The Reserve Bank of India has identified cross-border payments as the second cohort of its regulatory sandbox (RS) program in a bid to make international remittance channels and make them more accessible and affordable.
Under the program which commenced earlier this year, banks, fintech, and technology companies can collaborate and run real-time experimental pilots under the supervision of a central bank team who can then determine the efficacy of mass-market applications based on the results.
“The Cohort is expected to spur innovations capable of recasting the cross-border payments landscape by leveraging new technologies to meet the needs of a low cost, secure, convenient, and transparent system in a faster manner,” the RBI said in a statement on Wednesday.
India is the largest recipient of inbound remittances across the globe accounting for 15% of the global share in 2019 receiving around $83 billion. In the first half-year of 2020, India has received $27.4 billion, RBI said.
Additionally, the daily average turnover of OTC foreign exchange instruments in India is approximately $40 billion where technology-led solutions can ease the movement of money and facilitate convenience, the regulator added.
The window for submission of applications for eligible companies willing to participate in the cohort has been set between December 21, 2020, to February 15, 2021.