Funding in Indian fintech startups reached $7.8 billion in 2021 and the industry is expected to handle $1 trillion worth of assets by 2030, according to a new report
The new report from VC firm Chiratae Ventures and EY India reveals that the Indian fintech industry is expected to handle $1 trillion by 2030 across lending, insurance, wealth management and neo-banking. The study added that Indian fintechs will earn about $200 billion in revenue by the same time.
India was home to 21 fintech unicorns as of March 2022. Currently, most of the funding goes towards digital payment firms. Among the total $7.8 billion raised by the sector last year, $3.5 billion (roughly 44%) went to fintech payment companies. However, as India’s payment landscape evolves, technologies such as NFC payments, soft PoS penetration, and CBDC use cases are expected to drive new innovations and funding in this space.
According to the report, half of the AUM expected by 2030 will be powered by digital lending fintech firms, with a total of $515 billion worth of assets managed. Almost $1.2 billion was invested into Indian lending fintech firms in 2021, up almost 71% from the previous year. Besides, the Reserve Bank of India is looking to bring in further clarity to operating guidelines for the sector through its much-awaited digital lending guidelines.
By 2030, the report added, wealth-tech fintech companies will manage $237 billion worth of investor AUM, while insurtech and neo-banking will contribute $88 billion and $215 billion, respectively.
Furthermore, fintech models are evolving to be ‘pervasive’ across most sectors, finding applications across segments such as agriculture, supply chain and e-commerce.