SUMMARY
As per the Ministry of Commerce and Industry report, India recorded the highest FDI inflow of $83.57 Bn in FY21, an increase of $1.6 Bn as compared to the previous fiscal year (FY20)
According to an Inc42 report, the Indian fintech industry is anticipated to touch $1.3 Tn by 2025, expanding at a CAGR of 31% between 2021 and 2025
The fintech sector has substantially grown over the years, thereby, giving 21 unicorns to India
PM Narendra Modi has recently applauded the fintech players of the country for supporting economic reforms and being committed to India. He said that 40% of the world’s digital transactions are taking place in India.
Addressing an event at ISB, Modi also talked about how the fintech industry has dramatically changed people’s lives. “In a nation where banking was considered a privilege, fintech changed the lives of the common man. Where once to create trust in banks you had to take so much effort, now the world’s 40% digital transaction is happening there,” he added.
He noted that India has witnessed a record high foreign direct investment (FDI) while other countries are being affected by global supply disruptions led by Covid-19 and the Russia-Ukraine war.
As per the Ministry of Commerce and Industry report, India recorded the highest FDI inflow of $83.57 Bn in FY21, an increase of $1.6 Bn as compared to the previous fiscal year (FY20).
With the rise of the Indian fintech sector, foreign players such as Visa are also eyeing the industry. The credit card company is presently exploring partnerships with Indian fintech players for supporting its B2B offerings. It seeks to offer credit to small and medium enterprises (SMEs) via its credit cards. Furthermore, it is looking to invest in some fintech startups in India.
According to an Inc42 report, the Indian fintech industry is anticipated to touch $1.3 Tn by 2025, expanding at a CAGR of 31% between 2021 and 2025. Out of all subsegments, the lending tech will account for 47% ($616 Bn) while insurance tech will account for 26% ($339 Bn) and digital payments account for 16% ($208 Bn).
The fintech sector has substantially grown over the years, thereby, giving 21 unicorns to India. These fintech unicorns are working in the emerging sectors including digital payments, cryptocurrency, lending, and fintech SaaS, among others.
Some of the prominent players in the fintech industry are Paytm, BharatPe, PhonePe, RazorPay, Innoviti, slice, and CredAvenue.
In May, digital payments solutions startup Innoviti raised $10 Mn in its ongoing Series D funding round from Netherland-based FMO. The round was a mix of debt and equity.
While, listed fintech player Paytm’s parent would be investing INR 950 Cr in Paytm General Insurance Ltd to increase its stake to 74%. The fintech giant will be infusing the money in tranches over the next 10 years. The development is happening at a time when Paytm’s stock has tanked on the Indian bourses.
Paytm’s stock has plummeted down from its issuing price INR 2,150. It is trading at INR 610.50 on 27th May.
Earlier in May, Razorpay announced an ESOP liquidation program worth $75 Mn. Lightspeed Venture Partners and Moore Strategic Ventures also participated in the program.
