India Fintech Ecosystem Review: Innovation, Financial Inclusion and Global Partnerships

We recently released our latest edition of #PitchShare Ecosystem Report on #FinTech in India. #Pitchshare offers a unique combination of discovery and insight. This ensures that our corporate and investor partners spend more time on venture engagement rather than venture scouting. Through our ecosystem reports, we bring international perspective and our collective expert insight in assessing local innovations against global opportunities. The FinTech report provides a comprehensive ecosystem view straddling innovation in technology and business models, corporate-startup collaboration, regulatory landscape, government initiatives and emerging ventures. The purpose of the report is to uptier the level of ecosystem discussion and generate interest in the global community towards participating ventures and the local ecosystem, with a view to generate more commercial opportunities for disruptive innovation.

Below are some useful insights from the report.

1.     Still early days but lending and payments model evolving rapidly

There has been significant innovation in business models within lending and payments, which are the largest sub-verticals in FinTech. In the infographic below, we provide a handy framework to understand the various sub-verticals along with category leaders and upcoming startups in each of them.

With a strong emphasis on financial inclusion, development of proprietary credit assessment models esp. for MSMEs, facilitating digital payments sans internet, payroll lending etc., it is only a matter of time when the currently underbanked population will have easy access to credit.

2.     Blockchain and AI are rapidly facilitating banking process automation, with incumbent banks actively engaging with startups and/or developing in-house solutions

Processes such as KYC/Authentication, fraud prevention, contract management, collections etc. are increasingly being streamlined by Deep Tech. Chatbots and Robo Financial Advisors are simplifying financial services for the masses. International remittances are becoming cheaper and faster (almost real time vs. taking days!). Newer services such as escrow account for real estate transactions are addressing real needs. Many large banks have been actively engaging with startups to leverage deep tech and expand their customer base with improved services.

3.     Commercial opportunities abound for FinTech startups globally

Especially in the India-UK/Europe corridor, we have been impressed with the success of some Kabeela FinTech startups in the area of business process automation using blockchain, engaging in paid POCs with banks and insurance firms. There is immense commercialization potential for FinTech/Insurtech startups that are ready to scale and explore international markets.

4.     Regulation is evolving and is to be watched

Whilst the Indian regulators have made their strict stance explicit on cryptocurrencies, rules around the wider FinTech offerings are still evolving. Recognition of P2P platforms as NBFCs are a big nod for innovation while preserving the financial stability by tools such as minimum reserve and leverage requirements. It is yet to be seen how proprietary engines being used for lending (some of which may access user texts and chats for credit history and may trigger data privacy issues) will be viewed by the regulator. Possibility of a regulatory sandbox exists, which if implemented will not only reduce the time-to-market for innovative products but will also ensure a robust regulatory framework to ensure financial stability.

5.     Our top picks – Kabeela.life #PitchShare Featured FinTech Startups

In this edition of #PitchShare we featured 9 startups that are either unheralded heroes and make for a great investment opportunity or are B2B scaleups that have immense potential for commercial opportunities internationally.

·        Cash Cow – online marketplace for credit products with an offline network of advisors

·        Z2P – peer to peer lending platform

·        Moneytor – automates debt collection process

·        Escrowffer – escrow account services for real estate transactions

·        FTCash – digital payments and credit for MSMEs

·        Arya.ai – deep learning platform for enterprises for business process automation

·        Signzy – digital onboarding and KYC solutions for financial institutions

·        Primechain Technologies – Bankchain community of banks for blockchain solutions

·        SatSure – Combines satellite imagery and deep tech to evolve crop insurance products.

Contact me on shipra@kabeela.life to schedule a call if you:

  • wish to access the detailed report
  • are an investor and would like to discuss commercial opportunities for your portfolio companies or seek expert opinion on potential investees
  • are a corporate looking for meaningful engagement for POCs/co-creation with promising startups

ABOUT THE AUTHOR

Shipra (IIT-K, ISB alumna) is the Co-founder of Kabeela.life Ventures. She has 12+ years of regulatory and business development experience in financial services in Europe working with Fortune 500 companies. She has been a key opinion maker in her industry, and has influenced a number of flagship Government policies in the U.K, including Help To Buy. She has worked closely with the HMTreasury, PRA, FCA, and BoE.

For more details about Kabeela.life Ventures, visit us on www.kabeela.life and follow us on TwitterLinkedinFacebook

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