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No proposal to regulate finfluencers, clampdown on ponzi apps in works: FM

Regulating crypto without global consensus will not be effective, says finance minister Nirmala Sitharaman

Nirmala Sitharaman

File pic | Photo: ANI Twitter

Nikesh Singh New Delhi

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Finance minister Nirmala Sitharaman on Sunday said that her ministry does not have any proposal before it to regulate financial influencers, but warned people to tread with caution while seeking their advice.

“At this stage, I’m not having any proposal before me for regulating financial influencers. Social and financial influencers are all out there. If there are three-four people giving us good advice, there are seven others out of 10 who are probably driven by some other considerations,” she said at an event organised by Thinkers Forum in Bengaluru,.

Sitharaman also said that the finance ministry is working with the ministry of electronics and information technology (MeitY) and Reserve Bank of India (RBI) against the ponzi apps. She said the Centre is clamping down on them like never before, so that citizens are safe from such financial scams.

“There are also apps, which are coming out and reaching out to people, saying we can do this, we can do that; your money will fetch you this much. Many of these are ponzi,” she added.  

She advised users not to flock for such offers without doing due diligence. “You save it, you protect it,” she added. 

In February, MeitY issued orders to block around 138 betting and 94 Chinese loan apps for alleged involvement in money laundering and posing a “threat to the financial security of the nation.”

The RBI, in its regulatory framework released in August 2022, mandated that loan disbursal should only be carried out by entities regulated by it or those permitted under the law.

Speaking on crypto currency, Sitharaman said, “No one country individually can effectively control it. This is because technology doesn't have any borders, it can just pass through. So, the very character of it being technology-driven requires all countries to be on board, or else it will not be effective.”

The finance minister said that the Indian rupee has withstood the test of time by being steady. She added that it is the trust and strength of the rupee that is aiding in its internationalisation.

Speaking on the recent controversy surrounding the entry of Amul into Karnataka, she stated that the accusations of bringing in Amul to kill Nandini were “brazen.”

“This, strictly speaking, is tweaked, twisted, and made an emotional issue because it is election time. Amul entered Karnataka when there was a Congress government here,” she added.

Sitharaman said that inflation in India is today largely imported because of the price of fuel and fertiliser.

“The pressures on inflation in India are largely because of the imported hikes in prices. Covid wasn't even completely over when the war in Europe began and it had global repercussions. Fuel prices went up and food insecurity was seen in many countries,” she said.

“During Covid, many developed economies printed and distributed money. This formula resulted in double-digit inflation in their economies, something which wasn't seen in 30-40 years. Initially, interest rates were 'low for long' and now inflation rates are 'high for long' in countries which printed money and distributed it during Covid. Their economy is in a state of flux and in a recessionary phase, which will have spillovers worldwide,” she added.

Sitharaman emphasised that changes brought in the income tax regime are aimed to widen the tax base and encourage people to pay taxes. “We have brought in a parallel and simplified income tax regime with lower tax rates and less exemptions.”

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First Published: Apr 23 2023 | 2:13 PM IST

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