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Fintech Market Overview

This article does not constitute legal advice.

Smart contracts in India

Fintech Software

In India, several corporate entities are experimenting with the use of self-executing contracts for routine transactions; however, these contracts operate in a regulatory grey area. Self-executing contracts are governed by the pre-existing legal framework, particularly the Indian Contract Act, the IT Act and the Indian Evidence Act. While these contracts fulfil the basic requirements of being a consensual agreement entered into for consideration, a lacuna exists with regard to their authentication and admissibility. One such issue is that the IT Act only authorises digital signatures issued by entities certified by the government (and not self-generated digital signatures) and the Indian Evidence Act only allows the admission of those documents that are authorised by the IT Act.1

Separately, the MEITY has released a report, while assessing the cases for blockchain technology underlying smart contracts, where it contemplates potential blockchain applications, which include using it for the transfer of land records and the e-Notary service, among others. In a recent update, the MEITY sought to improve the security of blockchain technology by creating a repository of known blockchain vulnerabilities, with one of these being the Smart Contract Weakness Classification and Test Cases registry. There is a push to undertake more research on interoperability, scalability and performance, consensus mechanisms, security and privacy, key management, secure smart contracts and detection of vulnerabilities in blockchain technology-based solutions. However, there is no tailor-made dispute resolution mechanism in India for disputes arising out of smart contracts.1

Client identification in India

Fintech in India

Fintech in other countries

Notes
  1. https://thelawreviews.co.uk/title/the-financial-technology-law-review/india
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