Fintech: Reshaping Financial Services in India

Abstract

Fintech is ubiquitous to usage of technology in the finance industry. Fintech is seen as the future of financial sector in the digital space. The emerging economies like India with a growing middle-income group are providing a huge market witnessing a rising demand of banking services, in the backdrop of a growing young population with digital literacy. India is amongst the fastest growing fintech markets in the world, competing with US and China in fintech adoption. The Indian fintech ecosystem is growing at a fast pace and experiencing major transformation.

The study undertaken is a descriptive and diagnostic study to analyze the growth and evolution of the fintech industry in India with a changing landscape. The development of regulatory framework, increased adoption of fintech, impact of technology and financial inclusion initiatives, the new age customer, cost advantage have impacted the fast adoption of fintech in India. The adoption of digital technology and roll out of 5 G technology is expected to increase penetration of banking with real time usage of mobile devices for online payments and other transactions. The innovative fintech products provide solutions to growing needs of customers at a lower cost. Adoption of smart phones and real time payments are gaining popularity with usage of UPI, debit cards, credit cards acting as primary driving factors. Bharat Bill Payment System, National Electronic Toll Collection, Travel cards, Prepaid wallets, integration of National Common Mobility Card, Bill Now Pay Later will give an impetus. However, there is a need for the regulatory framework to keep pace with rapid innovations. It is imperative to develop global standard for regulatory framework with cross border coordination for all players and products including crypto assets. Skilled manpower, improved financial literacy, strengthening of cyber security, data privacy laws and infrastructure will address higher digital reach.