There are few nations in the world which are the growing hub of fintech startups. Fintech startups refer to those which work in implementing technology in traditional finance processes and play a huge role in modernizing any society. Most of the online financial services we use today were at some point proposing something radical that society had not thought of – and many startups today, are growing up to be similarly disruptive.
India is growing to be one of the best places in the world to have a fintech startup, as statistics suggest – this is no surprise, considering the support systems that the government has put in place to support entrepreneurship. India is currently home to more than 2000 startups operating in the field, and the number is second only to that of the United States. This is almost a three-fold rise in the last 5 years, with the number having been only around 700 in 2014.
The cumulative amount raised by these startups together amount to more than $2 billion, just in 2018. This fundraising was done over 165 deals, in the year. Most of the fintech startups currently operate in Payments, but there are plenty of promising companies which are trying to carve a market in wealth tech, personal lending, insurance and much more.
The Two Leading Cities
A large number of these startups are based out of two Indian cities alone – Mumbai and Bangalore. The two cities are home to close to 42 percent of all the fintech startups in the nation, and the other prominent cities include Delhi, Gurgaon, and Hyderabad. The smaller towns of the nation, however, still remain untapped by the services or presence of fintech startups, as stated by the India Fintech Report 2019.
Owing to the huge promise that these startups are currently showing to the government, it is no surprise that a large number of states are now showing interest in fostering promising startups. In the last year, a Special Fintech Committee was drafted by the government expressly for the purpose of supporting the growth of the sector. The Mumbai Fintech Hub and the Fintech Valley in Vizag are similar developments, which are meant to support this system. The creation of these areas represents how interested the government is in building up a strong segment and promoting entrepreneurship. The Marathi government even went a step further to create a fintech policy, and have already disbursed more than Rs. 9 crores to various startups in the form of prize money and grants in the state. The state even has a specially appointed fintech officer for pushing growth in this niche sector.
In any case, there is no doubt that India is emerging as a strong player in the world of fintech. Fintech is a sector with great promise, mainly because it is something that digitizes or deals with something that is the main aspect of human life. These startups not only promise to make life easier but also improve society greatly.