Over the last few years, Indias fintech sector has seen an exponential increase in capital, with investments totalling more than $8 billion already made across various phases of investment in 2021. While the Payments and Alternative Finance segments accounted for more than 90% of the sectors investment flows in 2015, there has been a significant shift towards a more equitable distribution of investment across sectors since then, with Insurtechs, Wealthtechs, and other areas receiving significant attention.
The fintech revolution in India is the result of years of work building the basis for key enablers through significant projects such as:
Jan Dhan Yojana: The worlds largest financial inclusion initiative, "Jan Dhan Yojana," has assisted in the enrollment of over 435 million beneficiaries in new bank accounts for direct benefits transfer and access to a variety of financial services applications such as remittances, credit, and insurance, among others.
Financial Literacy: The RBIs Centre for Financial Literacy programme and the establishment of the National Centre for Financial Education are two recent initiatives aimed at boosting financial literacy in India.
India Stack is a set of APIs that enables governments, corporations, startups, and developers to use a unique digital infrastructure to tackle Indias hard challenges in the direction of presence-less, paperless, and cashless service delivery. The India Stack has been a major reason behind fintechs rapid development.
Indias Fintech Market, 2021 Report
Fintech is one of Indias fastest-growing technology segments, including innovations in areas such as loans, payments, stock trading, and credit scoring. India has the greatest fintech adoption rate (87 per cent) and is the worlds largest destination for investment agreements as of 2020. Mumbai, Gurugram, Bengaluru, New Delhi, and Hyderabad are among the countrys top fintech locations. Mumbai and Bengaluru together account for 42% of Indias fintech hub.
Impact Analysis of COVID-19
The pandemic has benefitted the fintech industry. With the outbreak of the epidemic, the fintech industry rose to the forefront of the countrys fight for financial inclusion. The use of digital payments and financing has exploded. During the lockout, the number of digital transactions on the market increased by 40%. People began to switch from traditional financial ways to cashless and digital methods of payment as a result of their fear of public gatherings. As individuals became more interested in life and health insurance, the insurtech segment grew significantly. With the rise of digital payments and other financial technology solutions, the industry is likely to grow significantly.
The world of investment has changed dramatically as a result of technological advancements. Trading has become a lot easier, and trade processing times have shrunk. With the introduction of digital stock certificates, the marginal fraud connected with paper stock certificates has vanished. Investors can now look up a stocks historical price history and read through research papers created by specialists. Brokerage businesses offer a diverse choice of investment options, ranging from shares to mutual funds, derivatives to commodities, all under one roof.