Tamil Nadu to set up FinTech city

TE Raja Simhan | | | Updated on: Dec 05, 2021

Fintech (financial technology) concept. Business person with tablet and fintech illustration. | Photo Credit: JIRSAK

Floats tender for a project management consultant

The Tamil Nadu government has kick-started the construction of a FinTech city in Chennai with Tamil Nadu Industrial Development Corporation (Tidco) issuing a tender to select a Project Management Consultant for the ₹165-crore project.

While a FinTech Policy is being prepared, the State government wants to create an ecosystem in FinTech through the project to attract both domestic and overseas financial institutions and to transform Chennai as one of the major global financial services centres.

It will be developed with the requisite supporting infrastructure to accommodate financial institutions such as banking, non-banking financial services, financial BPO; regulatory institutions, financial market operations and training centres.

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The FinTech city will also supplement the efforts of FinBlue, a FinTech Centre of Excellence hosted at STPI, Chennai, which identifies, nurtures, funds and scales FinTech start-ups. The State government had contributed ₹5.75 crore for the centre.

The tender said that Tidco had carried out the Techno Economic Feasibility Study and plans to develop the project in three phases as a hub-and-spoke model. The State government has allotted 112.8 acres for the project in the city.

Mahesh Ramachandran, General Partner, Pontaq Venture Capital Fund, said that FinTech city could be a game changer to position the State as a financial hub to leverage on the solid work being done here by global corporations,

In May, during an interaction with State Finance Minister Palanivel Thiaga Rajan, the CII Southern Region’s Chairman CK Ranganathan said that Tamil Nadu has a vibrant ecosystem to attract investment in the banking and financial services sectors and urged the State government to revive the FinTech City project, which is a dream of Chief Minister MK Stalin.

Policy initiatives

In his inaugural budget, Rajan announced the formation of a separate ‘FinTech Cell’ in Guidance - the nodal agency of Tamil Nadu government for investment promotion and single-window facilitation - to promote and facilitate investments in the areas of FinTech, Global Capability Centres and Data Centres. The FinTech Cell shall be set up with members from Guidance and the industry to help the State establish industry connections and attract investments.

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Tidco in association with Tamil Nadu Infrastructure Fund Management Corporation Ltd has set up an Emerging Sector Seed Fund with a corpus size of ₹500 crore. This fund will focus investment in emerging sectors, including FinTech, says the Major Industries’ Policy Note for 2021-2022.

Further, under the Scheme for FinTech Institutions, assistance will be provided to FinTech companies that leverage technology to meet the credit needs of entrepreneurs in the State. A maximum financial assistance under the scheme is ₹10 crore per borrower, says the Policy Note.

Published on September 17, 2021
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