One-stop destination for financial services: the future of the fintech industry

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The unavailability of public transport, social distancing standards, the limited working hours of the few banks present nearby and the understaffing of bank branches added to their woes.

The Indian fintech industry has shown a remarkable growth trajectory in recent times, after undergoing a radical transformation. According to a recent Research and Markets report, in March 2020, India had the highest fintech adoption rate, a whopping 87%, in all emerging markets around the world, after China. In 2019, the FinTech market in India was valued at over Rs 1,920 billion and is expected to exceed Rs 6,207 billion by 2025, with a CAGR of 22.7%.

With such remarkable progress, it’s no surprise that customer expectations are rising as well. The increased penetration of the internet and the use of smartphones have made it possible for people to meet almost all of their financial needs with just one click. This is true for the vast majority of the country’s urban population. Gone are the days when we had to make multiple trips to bank branches for a variety of reasons – whether for simple functions like depositing cash / check, or for more extensive functions like loans or credit cards. credit. Today all we have to do is open the corresponding mobile application on our smartphones and almost all financial services are available under one roof. However, Tier III, Tier IV, and Indian hinterland cities tell a different story.

Despite technological advancements in the FinTech sector across the country, a significant percentage of the population, especially in rural areas, need help accessing a hassle-free experience to meet their financial needs. To address this, major industry players are stepping up efforts to ensure that citizens, even in remote pockets of India, can have seamless experiences by acting as unique destinations with a plethora of services.

The difficult situation of COVID-19

When we consider the growth of fintech in 2020, we simply cannot ignore the pandemic. The devastating impact of the epidemic has dramatically reduced cash transactions in urban cities due to security concerns. But in rural areas, a large majority of people depend on cash for their day-to-day transactions – whether to buy groceries or even to pay for transportation. Apart from that, the older generation in the backcountry might need help meeting their daily financial needs such as withdrawing money or getting a loan or even insurance.

The pandemic not only brought the world to a complete halt, but also negatively impacted millions of people in remote areas by cutting them off from the outside world due to a series of lockdowns. The unavailability of public transport, social distancing standards, the limited working hours of the few banks present nearby and the understaffing of bank branches added to their woes.

For example, a small farmer in a remote village in UP or Odisha largely depends on cash to sell his produce to the local mandi, pay the grant, and buy other groceries on the farm. markets. And bank branches might not be easily accessible. Since the start of the pandemic, due to strict social distancing standards, public transportation has been temporarily disrupted, making it almost impossible for her to access the bank and deposit / withdraw money to her account. .

All-in-one solution

The aforementioned array of challenges created a huge gap in banking facilities and posed many challenges for people in the hinterlands of the country. It became almost impossible to complete their daily transactions, and the process of visiting banks and withdrawing cash was tedious. In an effort to bridge the gap and improve financial inclusion across the country, companies in the fintech sector, especially start-ups, have started visiting the homes of people living in isolated pockets of the country for them. help to cope with their daily financial needs.

From home cash delivery to insurance coverage, recharges and bill payments and even, emerging fintech players are offering almost all financial services under one roof, right at the customer’s doorstep. These all-in-one solutions have solved the financial problems faced by the rural Indian population to a large extent, allowing them to withdraw money through AePS (Aadhar-enabled Payment Systems) and perform other transactions in the comfort of their home with sufficient assistance from the bank. correspondents and agents.

To sum up, technology is advancing at a breakneck pace, bringing us groundbreaking technological innovations that ensure convenience and security, not only in metropolitan cities, but also in the hinterland of the country. That being said, the future of the fintech industry will certainly include all-in-one payment solutions that will simplify the entire banking process.

by Amit Nigam, COO and Executive Director of BANKIT

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