Union Budget 2026: Fintechs seek push for digital payments, inclusion and cross-border flows

With the Union Budget approaching, payments and fintech industry leaders are calling for policy measures that support digital adoption, financial inclusion and regulatory clarity, as India’s payments ecosystem enters a new phase of growth.

Matías Gainza Eurnekian, CEO of Federal Card Services (FCS), said India’s payments landscape is expanding rapidly, driven by rising incomes, higher consumer spending and deeper digital penetration. “India’s payments landscape is entering its next phase of expansion, supported by rising consumer incomes, growing spending power, and rapid digital adoption,” he said. 

Citing industry insights from PwC and Visa, Gainza noted that higher disposable incomes are closely linked with increased usage of cards and digital payment methods, particularly when supported by strong acceptance infrastructure and innovative offerings.

Against this backdrop, Gainza said the upcoming Budget presents an opportunity to strengthen the foundations of the payments ecosystem. He called for targeted incentives to support advanced manufacturing and local production, which would help build a more resilient and globally competitive payments value chain. 

“Extending and modernising schemes such as the Production Linked Incentive (PLI), particularly for next-generation technologies, would further support this momentum,” he said. 

He also stressed the importance of policy certainty, adding that confidence in the macroeconomic environment directly supports adoption of new payment technologies and long-term sectoral growth.

Financial inclusion

A key area of focus for the Budget, according to Gainza, should be financial inclusion. He said the non-bank Business Correspondents (BCs) ecosystem and rural fintechs play a critical role in enabling last-mile access to banking services. “BCs are the backbone of assisted digital finance in Bharat,” he said, pointing to services such as mATM transactions, Aadhaar-enabled payments, cash-in and cash-out, and basic account access in areas with limited physical bank branches. Strengthening this network through better infrastructure, digital tools and sustainable incentives would deepen formal banking penetration, he added. Enhanced rural connectivity and the adoption of vernacular and voice-based interfaces could further boost trust and usage among first-time users.

As fintech participation in core banking and payment services expands, Gainza also flagged the need for clearer regulatory guidelines. He said consistent disclosure norms, stronger grievance redressal mechanisms and clear compliance expectations would enhance transparency and consumer protection, helping the sector scale responsibly.

Cross-border and forex payments

Meanwhile, Srikrishna Narasimhan, Whole-Time Director and CEO of GlobalPay, highlighted expectations around cross-border and forex payments. He said outbound education, overseas business expansion and leisure travel are driving strong growth in cross-border transactions. “The Union Budget offers a timely opportunity to address the distinct needs of these segments through targeted regulatory and infrastructure measures,” he said.

Narasimhan suggested extending tax collection at source (TCS) exemptions to education-related payments made from students’ own funds, in addition to loan-funded remittances. He also raised concerns about closed or semi-closed education payment platforms linked to specific universities, calling for open access and fee neutrality. To improve oversight, he recommended clearer safeguards, mandatory documentation for education and travel-focused instruments, and purpose tagging of cross-border payments aligned with FEMA categories.

As outbound travel rises, Narasimhan said consistent policies and interoperable cross-border infrastructure would be key to delivering transparent and affordable forex solutions and positioning India as a credible global payments hub.