Comparative Guides

Welcome to Mondaq Comparative Guides - your comparative global Q&A guide.

Our Comparative Guides provide an overview of some of the key points of law and practice and allow you to compare regulatory environments and laws across multiple jurisdictions.

Start by selecting your Topic of interest below. Then choose your Regions and finally refine the exact Subjects you are seeking clarity on to view detailed analysis provided by our carefully selected internationally recognised experts.

4. Results: Answers
How is innovation in the fintech space protected in your jurisdiction?

Answer ... Copyright is the primary instrument through which innovation in software products is protected in India.

Copyright is governed by the Copyright Act, 1957. Copyright protection is available for original works of authorship expressed in tangible form. Registration is not essential for a copyright to be valid and the rights arise once the original work is captured on a tangible medium. That said, to assert one’s right over a work, it is advisable to ensure that this is recorded, along with the date, in a manner that may be admissible in court.

In India, patent protection is not available for software per se, so entities rely on copyright protection to protect software and other computer programs. However, software may be patented if it is part of an invention – such as software combined with hardware that is both inventive and capable of industrial use. The Patent Act, 1970 stipulates that computer programs are not patentable per se. Hence, the software must be integrated in some other patentable product. A patent application pertaining to software only will be rejected.

For more information about this answer please contact: Probir Roy Chowdhury from J. Sagar Associates
How is innovation in the fintech space incentivised in your jurisdiction?

Answer ... In August 2019 the Reserve Bank of India released a framework for a regulatory sandbox for fintech innovation. The framework covers a specific set of products, including:

  • money transfer services;
  • marketplace lending;
  • digital know-your-customer (KYC) services;
  • financial advisory services;
  • financial inclusion products;
  • applications under blockchain technology;
  • mobile technology applications; and
  • cybersecurity products.

It specifically excludes certain products from its ambit, such as:

  • credit registration;
  • credit information;
  • cryptocurrency services; and
  • initial coin offerings.

Applicants benefit from relaxed regulatory requirements in relation to customer privacy and data protection, secure storage and access to payment data, KYC/anti-money laundering requirements and statutory restrictions, among other things.

The Securities and Exchange Board of India (SEBI) released a framework for an innovation sandbox on 20 May 2019. The innovation sandbox is a testing environment in which fintech players and other entities not regulated by SEBI can utilise the data made available by stock exchanges, depositories and similar entities for offline testing of their products in isolation from the market. Participants will be given access to historical and anonymised market data such as order logs, trade logs and KYC data to test solutions in the innovation sandbox.

Start-ups in India enjoy certain regulatory and tax incentives under the government’s Start-Up India initiative. Fintech companies that qualify as start-ups, as recognised by the government, are also entitled to these benefits.

For more information about this answer please contact: Probir Roy Chowdhury from J. Sagar Associates