Having arrived in India less than ten years ago, financial technology is rapidly gaining ground in this country so much that India is on the verge of becoming the world’s fastest-developing fintech market. With its adoption rate of 52%, it is already ahead of the leaders in the international fintech market, like the States, Singapore and the UK, and ranks second to China only.
The Indian FinTech services and software market doubled in the last four years, and its transaction value increased from USD33 to USD35 billion in the same period, with an impressive five-year CAGR of 22%. Referring the reader to numerous relevant sites for the crypto and forex investment analytics https://finstrategy.in/, we shall briefly consider the most significant drives behind the Indian FinTech boom.
In an attempt to boost the customer experience, large financial institutions in this country and worldwide have been keen on applying artificial intelligence, blockchain startups and back-office and front-office machine learning. As part of this process, mobile banking grew fast in India, with the total value of mobile transactions increasing from just over INR200 billion in 2014 to nearly INR15 billion in 2018.
That has made India of the world’s most attractive mobile markets by now, with artificial intelligence serving such diverse banking sectors as brand management, loans accounting, customer acquisition and onboarding and credit risk assessment. However, the trend would not be as pronounced without the government’s active participation in its progression.
The Indian government has invested considerable amounts of money into the national enterprise to facilitate the country’s development into one of the strongest economies in the world. The domestic market has received the largest share of support since it happens to be the most significant contributor to India’s economic growth and the federal budget.
What is of particular interest to us here is that financial services and technology receive more than a third of the total investment. For example, of $9.3 billion invested in August 2021, $2.2 billion went to financial services, while the government’s support of the financial technology industry increased from $35 million in August 2020 to $1.6 billion in August 2021.
The Indian authorities must have recognised the value of the relevant sectors of the national economy to allocate such a large share of the federal budget to the further growth of crypto and forex markets. And the FinTech startup companies did not take long to respond.
According to the NASSCOM reports, more than 400 FinTech companies are operating in India already. Besides, the country ranks second-highest in the number of annual startups in this industry. Moreover, about one-third of all the financial technology companies in India focus on digital payment processing, creating invaluable opportunities for lucrative investments in its forex and crypto markets.
To date, India has become one of the most vibrant international centres for FinTech startups, ranking second to the USA only, and about 80% of its financial institutions use digital currencies for their transactions. Of all the sectors of the country’s financial technology market, it is the B2C companies that seem to attract the largest share of investments, especially foreign direct investments.
India has always been exceptionally good at adapting to the changing circumstances in virtually all areas of human activity, and it seems that the post-industrial economy will not be an exception. Procrastinating for years, it then makes several quantum leaps towards the Olympus, only to wait for us to catch up with it in the end. And it is with unconcealed admiration and awe that the world is watching India become an indisputable leader of the digital economy.