India’s economy on the rise: The role of the LEI in modernising trade infrastructure

6 huhtikuun 2023

The rapid growth of identity and digital trust technologies is transforming global commerce. According to a recent study by IDC, 79% of digitally mature organisations worldwide will prioritise trust programmes in 2023 to close security gaps and strengthen data protection. This change is crucial not only in Western countries but also in emerging markets such as India. The Legal Entity Identifier (LEI) plays a central role in this.

Why the LEI system is essential for India

India, one of the fastest-growing economies in the world, faces the challenge of modernising its trade infrastructure while ensuring security and transparency. The LEI, a globally recognised system for uniquely identifying companies, offers a tailor-made solution. With over two million LEIs registered worldwide, this system is well-positioned to help India optimise its trading relationships while minimising the risk of fraud and financial crime.

An LEI is a 20-digit code linked to a verified company registration and comprehensive information set. In India, where digitalisation advances, companies can improve their international competitiveness through LEI registration. The LEI system promotes security and transparency in trade and the efficiency of supply chains, which is particularly important in a dynamic market like India.

The importance of the LEI for the Indian market

Indian companies engaged in international trade face the challenge of verifying their identity across borders. The LEI offers a cross-border solution recognised by over 200 financial regulators worldwide. This recognition makes it easier for Indian companies to access international markets and boosts the confidence of investors and business partners.

In addition, the LEI system supports Indian companies in complying with global regulatory requirements. Given the increasing importance of compliance in international trade, LEI registration offers a way to fulfil regulatory requirements while promoting business development efficiently.

vLEI: The next level of digital trust for India

Another milestone in digital identity is the introduction of the verifiable LEI (vLEI). This innovative model of decentralised business identity enables businesses to digitally identify themselves and verify the authenticity of their counterparties in real-time. For India, which is positioning itself as a technological pioneer, the vLEI offers an opportunity to increase security and efficiency in commerce further.

The vLEI system is particularly relevant to the Indian economy as it aligns with the principles of Zero Trust Architecture, which is gaining momentum in the cyber security industry. It provides an additional layer of digital trust, especially crucial in a globally connected market like India.

The LEI is the key to trade modernisation in India.

India is facing a fundamental shift in its trade landscape. With increasing digitalisation and the growing importance of security and trust measures, the LEI offers an indispensable solution. Through LEI registration, Indian companies can strengthen their global competitiveness, fulfil regulatory requirements and gain the trust of their international business partners.

In a rapidly developing market like India, using the LEI system is a step towards modernisation and a crucial factor for sustainable growth and economic success. The LEI system, supported by the introduction of the vLEI, positions India as a strong player in global trade while promoting a more secure and transparent trading environment.

The importance of the LEI to the Indian market cannot be overemphasised. With its ability to promote identity security, efficiency and transparency in trade, the LEI system is ideally suited to meet the challenges of modern trade and drive India’s economic development.