How digitization drives India’s Fintech growth

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India’s Fintech system continues to grow even when the pandemic shattered the economy and businesses. During lockdowns and work from home, digitization in banking, financial services, and insurance (BFSI) became compulsory from discretionary.

India’s fintech space is building up, and there is a lot of strength on the supply side. India Stack (a digital infrastructure that provides paperless, presence less and cashless delivery) and other infrastructure have provided robustness to the fintech space.

According to the India Fintech report of 2020, India ranks second for the fintech startups established in the last three years after the US.

The total funding in Fintech space touched $5.4 billion between January 2019 to June 2020. The investments in H1 2020, was 60% more than in 2019, amounting to $1.47 billion.

According to the report, 10% of the total funding went to Series A and early-stage funding rounds. Approximately 60% of the total funds went to already matured companies (Series G) like Paytm.

Series B locked in 26 deals amounting to $868 billion. Lack of capital and other challenges prevented the companies from growing faster.

Mumbai and Bengaluru lead the fintech momentum. Collectively, these cities represented 42% of the 2127 startup headquarters.

India has seen unstoppable growth in several sectors. The advancement in the economy due to technology is yet to fill all strata of society. Infosys said they are now working on setting up digital infrastructure for financial inclusion, and the next step is to ensure that every consumer has access to financial services.

Government initiatives such as regulatory sandboxes, account aggregation, and other digitization drives are a boon to fintech startups.

Fintech companies are seeing growth in equity investing. CDSL (Central Depositary Service Limited) recorded 1.2 million new accounts in 2 months.

The India Fintech report is a comprehensive report on India’s fintech space, covering all sectors across the industry. It dives deep into all fintech segments in India. It provides insights into payments, insuretech, lending, wealthtech, and various other valuable domains.

The report provides an in-depth analysis of what is happening in each segment by studying the trends, innovative business and tech models, opportunities and challenges.

India needs policies and regulations to support the robust growth of fintech companies in India. The infrastructure will provide a healthy environment for the startups to grow and contribute to India’s GDP.

The increased number of digital transformations, growing internet penetration, push for digital payments, and bank’s efforts towards digital transformation have led to fintech growth in India.

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