“Why Fintech industry in India has got the potential to reach $1 trillion in value by 2025?” as per Business Standard.

Over a long time, fintech solutions evolved under the leadership of a single individual. The term “Fintech” emerged in the late 20^th century, gaining significant prominence in the 1990s with Citicorp Chairman John Reed as the chairman to describe the Financial Services Technology Consortium.

The key milestones in the development of fintech include:

1. In 1967, Barclays introduced the first ATM, marking the beginning of modern fintech.
2. In the 1970s and 1980s, the growth of electronic banking and computer systems set the stage for further innovations.
3. In the 1990s, the term “fintech” gained traction as the industry began to expand rapidly.

The roots of the financial technology (fintech) industries date back to the late 20^th century, with the advent of electronic banking and online stock trading. Fintech has been expanded and changed over time as a result of technological and internet advances. It results in new financial services and products that are created to enhance accessibility, simplicity, and effectiveness in the financial services industry.

Fintech industry in India

In India, over the timeline, fintech solutions are invented by a single individual. The development of fintech in India is driven by various factors, such as government initiatives, technological advancements, and entrepreneurial efforts.

The key milestones are:

• In the early 1990s, banks adopted technology for improving operations, leading to the introduction of ATMs and electronic fund transfers.
• In the late 1990s and early 2000s, Internet banking gained popularity, allowing customers to conduct transactions online.
• In 2016, the UPI (Unified Payments Interface) by the National Payments Corporation of India (NPCI) revolutionized digital payments.

Sachin Bansal, co-founder of Flipkart, contributes to the fintech landscape with ventures such as Navi Technologies.

The sector is profoundly encouraged by the Reserve Bank of India (RBI) and also promoted by the government’s initiatives in digital payments and financial inclusion.

In 2016, the RBI introduced the Payment and Settlement Systems (PSS) Act, allowing fintech companies to operate as payment aggregators and provide payment services to consumers, paving the way for a new era for fintech in India.

The traditional banking system has become one of the backbones supporting the fintech industry to thrive with reliability and assurance that your money is saved.

Banking is improved with an online payment mode, as is the ease of transferring money via UPI rather than cash, enhanced transparency, and trustable ways to circulate the money.

Is Fintech playing an important role in Disrupting Traditional Banking?

The traditional banking system has become one of the backbones supporting the fintech industry to thrive with reliability and assurance that your money is saved.

According to Business Standard, “India’s fintech sector has the potential to reach $1 trillion in value by 2025.”

Banking is improved with an online payment mode, as is the ease of transferring money via UPI rather than cash, enhanced transparency, and trustable ways to circulate the money.

The ways the fintech companies improved the banking system were:

• Digital Payments: UPI (Unified Payments Interface) was introduced by fintech companies, reducing the need for cash transactions and increasing financial inclusion.
• Lending: The online lending platforms are developed by fintech companies to provide faster and more convenient access to credit for consumers and small businesses.
• Investments: Robo-advisory platforms are introduced by fintech companies that are providing investment advice and portfolio management services to consumers.

The popular statements from the leaders in the fintech industry are:

1. “Fintech is not a threat to traditional banking but a complement to it. Fintech companies are providing innovative solutions that traditional banks cannot provide.” Nandan Nilekani, Co-Founder, Infosys. (Source: Economic Times)
2. “India’s fintech sector has the potential to reach $1 trillion in value by 2025.” Naveen Surya, Chairman, Fintech Convergence Council. (Source: Business Standard).
3. “Fintech is changing the way we think about banking. It’s no longer just about transactions, but about providing financial services to the unbanked and underbanked.” Sathish Murali, CEO, Paytm (source: Forbes India).

Examples of the Fintech Industry

1. Paytm: India’s largest mobile payments and commerce app, offering a wide range of services such as bill payments, money transfers, and investment services.
2. PhonePe: A digital payments platform, that allows transfer of money, pay bills, and make online purchases.
3. GooglePay: A digital payments platform, that allows transfer of money, pay bills, and make online purchases.
4. RazorPay: The payment solutions are provided for businesses, including payment gateways, subscription billing, and payment links.
5. Cred: The rewards for users for paying their credit card bills on time and offers various financial products.
6. MobiKwik: A digital wallet service provider offering mobile and online payments.
7. PolicyBazaar: An online insurance aggregator supporting users to compare and buy insurance policies.
8. Upstox: Online investment platform offering stock trading, mutual funds, and other investment services.
9. ETMoney: Full-stack investment platform providing financial planning and investment solutions.
10. Instamojo: A digital payment solution for small businesses and entrepreneurs.
11. ZestMoney: Offers a “buy now, pay later” service, allowing users to make purchases on credit.

Sources:- cointelegraph, Payspace magazine, fintechcouncil, startuptalky, founderjar, pexels, mordorintelligence, getsmarter