Digital India is ambitious and here to stay.
The Indian government deserves all the accolades as it revolutionised the financial transactions in the country with the introduction of UPI.
The P2P transactions surged to an all-time high of 674m in February 2019 with average daily transaction growth of 10.95%, according to the data released by National Payments Corporation of India (NPCI). The available data showed that UPI recorded a year on year growth by a staggering 300% from February 2017 which is indicative of the popularity of digital payments among the masses.
These developments have hugely benefited the Fintech sector as it has opened new avenues for businesses offering unique services, substantial profits with minimal finance compared to traditional investing methods.
Need for an Alternative
The Supreme Court’s verdict of Section 57 of the Aadhaar Act came down slowly on private firms as it ruled out companies to mandate customers to provide Aadhar for onboarding. It favoured the masses but not the industry as it complicated the businesses by shooting up the cost. The judgement was a shot in the arm for the government which emphasised a lot on promoting the Aadhar card. In turn, businesses were forced to go for subscription-based methods which are a cumbersome affair.
Fintech has been a significant catalyst in exploiting the digital space and hence requires consistent investment and development to supply users with higher value and generate good revenue.
Ever since Fintech made its foray into businesses, technology has been its asset and this year it’s going to be widely adopted with AI-driven API platforms. A shift from just transactions to providing insights in real-time for SMEs and transform the way money will move through businesses. There is enough scope for Fintech companies to add AI, Machine Learning and Predictive analytics to understand customer behaviour, choices and preferences, and deliver better customer experience automating a significant amount of work at their end.
It’s Apt for App
The overwhelming response by businesses to Fintech is mainly due to its easy payment process, effective evaluation of risks, faster investment and cost-cutting. Perhaps, smartphones are a great influencer in cost cutting since the devices can be targeted in making the financial services available along with gathering analytical data for audience engagement. Focusing on the Fintech apps development can provide users with secure access to funds and keep them updated on any business developments in real-time. The Fintech app developers will have a task cut out as more and more organisations embrace the platform. Well, this for sure will be a watershed moment.
The advent of mobile payment solutions will bring down the bank’s visitations significantly, and the trend is supposed to carry on in the future.
A Reliable Accompaniment
People from various industries are predicting that Fintech will continue to be a disruptive force across business verticals, primarily the start-ups. There is a dearth of financial aid and hence a need to create awareness on Fintech if we have to build a financial ecosystem that caters to the SMEs. Fintech will be a boon to entrepreneurs seeking for quick funds. Things are changing as SMEs haunted with limited availability of instant and easy access to funds can breathe a sigh of relief with more lenders evolving to neutralise the situation.
Nevertheless, the path looks promising but not without the hurdles. The 2019 elections will hurt the predicted proceedings. RBI can play spoilsport by rolling out, not-so-friendly policies and it remains a continuous obstacle as far as banks and Fintech is concerned. Investors can be sceptical and cautious about funding start-ups. Businesses should look for a substitute to Aadhaar-based digital KYC to make sure the speed of the work and customer experience is not affected. While we can expect a few obstacles here and there, the business prospects look optimistic and too reassuring to be ignored. There are no doubts industries are keen to merge with Fintech firms owing to its achievability and it’s just a matter of time before the government aligns to accomplish the same. For now, we shall wait for things to unfold for good!