Most industries in India faced a sharp setback following the outbreak of the COVID-19 pandemic. Industries across the world have experienced a slump through 2020 and the early months of 2021. The one industry, however, that continues to grow is the fintech industry.
With digital innovations sweeping across the country, there have been marked changes in how the average Indian consumer buys products and services, pays, invests, and transacts. Fintech innovations led by some of the most empowering leaders in India are now empowering the country and its financial services.
Top Five Fintech Innovations in India
Open Banking – In India, about 179 bank accounts are opened each minute on average, according to a media report by Tavaga. In a huge market such as India’s, it is inevitable that customers are demanding personalised financial services. The banking and finance sectors are adopting the open banking ecosystem which helps sharing of customer data upon the consent of the customer. With this, digital banking, investment, credit, and payment systems are opening up like never before. The inclusion and innovation trend is a game-changer in India.
QR Codes and Near Field Communication (NFC) – The mandated interoperability of QR (Quick Response) Codes have changed the way the common man pays for goods and services. Payments from all UPI apps are integrated, helping small businessmen, merchants, and vendors to become part of the cashless economy. The NFC card system has gained momentum in the era of COVID-19 and social distancing.
Round-The-Clock Instant Settlements – To improve the ease of doing business, India saw the launch of the round-the-clock settlement system. Payments through NEFT (undertaken by the RBI), UPI, and IMPS (undertaken by the National Payments Corporation of India) have helped boost P2P fund transfer, giving the economy a much-needed boost.
AePS – With the proliferation of digital payment systems and tech-based financial services, security has become the watchword. AePS (Aadhaar-enabled Payment System) has made it possible for PoS and ATMs to come up in rural areas. When connected with the national biometric database, the AePS enabled banking, and financial systems have powered the rural outreach programs.
Video KYC – Another step forward in financial inclusion, video KYC systems have enabled banks and NBFCs to offer banking and credit services to people across the country. The COVID-19 pandemic had led people to avoid visiting bank branches personally with social distancing being the new norm. Thus the digital onboarding process through video KYC was a relief to many as they could avail banking services without having to visit bank branches.
Benefits of the Fintech Revolution
In a country with a large population like India, the fintech revolution has given innovation and entrepreneurship a great boost. The spread of banking and financial services to tier II and tier III cities and to rural areas is due, in great measure, to the evolution of technological innovations. Harnessing big data, analytics, and scaling up operational models has become possible.
New technology has helped traditional banking institutions reinvent themselves in a new avatar and for NBFCs to find their space in the world of mainstream finances. Fintech has also made it possible for businesses to harness cost-effective technology to help them grow.
Top leaders in India leveraging financial technology optimally:
- Nikhil Kumar – Nikhil Kumar headed the team that built the BHIM app. Head ecosystem developer at India Stack, Nikhil Kumar, helped create APIs for public and private institutions. BHIM has become the backbone of UPI adoption in the country and has enabled digital payment systems for small and medium businesses. Nikhil is one of the visionary fintech leaders of India.
- Arif Khan – Arif Khan is the Chief Digital Officer at NPCI (National Payments Corporation of India) and leads digital initiatives that influence the financial services sector. He is one of the top fintech personalities of India. Arif Khan is the man who has led India’s digital transformation efforts through the use of emerging technologies, innovation, and analytics.
- Anna Roy – Anna Roy is from the Indian Economic Service and a Senior Advisor at NITI Aayog. She has been leading several fintech initiatives for the government of India. Anna Roy is the brain behind India’s AI policies, PPP (private-public partnerships) in the banking and financial sector, and the use of technology to initiate infrastructure reforms.
- Harshil Mathur – Harshil Mathur is the Co-Founder and Chief Executive Officer of Razorpay, India’s first converged payments solution company that allows businesses to receive and process invoices and disburse payments through many modes. With the COVID-19 pandemic forcing many businesses to go online and send and receive digital payments, Razorpay now processes about a third of the online payments made in the country.
- Sanjiv Bajaj – Sanjiv Bajaj is the Chairman and Managing Director of Bajaj Finserv. Bajaj Finserv keeps digitalising its services, thereby enabling customers to have improved access to financial services at the tip of their hands. As opposed to going after the commoditised mass-end of the market, he has built differentiation through innovation. This way, he has revolutionised finance in India by making it more tech-driven, customer-centric, and accessible to everyone.
- Rajesh Kumar – Rajesh Kumar is the Managing Director and CEO of TransUnion CIBIL Limited, the credit information company in India. He has been leading the team that has transformed the technology for credit report generation, based on data analytics. CIBIL is now a partner with most banks and NBFCs and offers the technology for instant score and report generation.
The fintech revolution led by some of the top financial leaders of India is the springboard that the country’s economy needs to rebound from the aftermath of the pandemic and the ensuing global slump. India is headed to digital-only banking, payments, and financial services ecosystem, and tech innovations are gearing up to make this a reality.
Technological growth and innovations are powering India’s banking and financial services sector. The focus on digitization and financial inclusivity is at the crux of this fintech revolution. Some of India’s top financial leaders are spearheading this transformation, and government policies provide them with the support they need in this drive. Let us take a look at some of India’s top fintech innovations and the people who are transforming the country’s economic landscape.