Fintech is the word that you get when you combine finance and technology. In simple words, fintech means applying technological solutions to financial services. Fintechs provide technologically enabled financial services which are easy to access by customers. Moreover, with the application of technology, innovative financial products and services are being offered to customers for meeting their financial needs. In fact, fintechs have increased awareness among investors about charting out their financial needs and then finding solutions to meet those needs. Doing financial transactions, banking, investing, saving, etc. have been simplified through digitized solutions being offered by modern-day fintech companies. Do you know how fintechs have been shaping the Indian financial market?
India and Fintech
India has been the main participant in the fintech revolution that is sweeping the world. A recent global survey about Fintech adoption Index conducted by Ernst & Young shows that India is the second country to adopt fintech @ 52% following China which is at the top @ 69% (Source: http://www.yesfintech.com/data/cms/ifor-report-2018.pdf). Reportedly, there are more than 1200 fintech firms in India and the numbers are poised to grow (Source: https://taxguru.in/rbi/opportunities-challenges-fintech.html).
However, the fintech sector in India also has its share of challenges. Some of them include the following –
- Raising sufficient capital
- Regulatory bodies which impose various laws and red tapes for the fintech to navigate through
- Cybersecurity
- Customers’ lack of trust in the online medium
- Low penetration of internet
Despite these challenges, the fintech industry is slowly booming. Though the challenges are slowing down the growth, the growth is steady.
RBI’s role in financial inclusion
Seeing the impact of fintechs, the Reserve Bank of India has also been taking steps to promote fintechs among consumers. After the Government’s move of demonetization, RBI has increasingly aimed at making the market cashless. Digital payment modes are being promoted with new and innovative solutions being designed for customers for paying for their transactions. Recently, the RBI presented a framework for ‘regulatory sandbox’.
A regulatory sandbox would be a live and controlled environment which would allow fintechs to test their new products on a limited scale before they present it to the world. Since the testing would be of a limited scale, in case of a negative response, the fintech would face lower losses and the costs are also reduced. This would also give fintechs a ‘safe zone’ to test their products. This regulatory sandbox concept would be a great push for fintechs to develop in a cost-effective way.
Why build your career in a FinTech company?
As stated earlier, India’s fintech scenario is expected to grow manifold over the coming years. According to a KPMG report, the transaction value in the Indian fintech sector is supposed to reach USD 73 billion by the year 2020 recording a CAGR of 22%. Due to the development of fintech and technology penetration, about 300 million Indians are expected to access banking facilities and increase their incomes by 5% to 30%. (Source: http://www.yesfintech.com/data/cms/ifor-report-2018.pdf). As incomes increase, individuals would have more disposable savings to invest which would give you an opportunity to boost your career in the fintech industry. As consumers become more aware of the financial solutions available in the market, you can find a good client base for your products. The boost in the fintech industry would directly impact your career and take it to new heights.
As the road ahead seems bright for fintechs, you can associate yourself with a reputed fintech company and bank on the potential. Fintechs like Turtlemint help in providing personalized and goal-centric solutions to investors and as you partner up with these fintechs, you can chart a vertical career graph. So, as India emerges as a promising fintech hub in the near future, make sure you ride this emergence and build up a good career.
