SME Times News Bureau | 30 Sep, 2021
Union Minister of Commerce & Industry said India is poised to become one of the largest digital markets in the world, adding that India has the highest FinTech adoption rate in the world, with Indian MSMEs also adopting FinTech rapidly.
Addressing the 2nd Global Fintech Fest-2021, the Minister said, "At 87%, India has the highest FinTech adoption rate in the world against the global average of 64%."
"As
of May 2021, India's United Payments Interface (UPI) has seen
participation of 224 banks & recorded 2.6 billion transactions worth
over $68 Bn and the highest ever, more than 3.6 Bn transactions, in
Aug’21,” said Shri Goyal. “Over 2 trillion transactions were processed
using the AePS (Aadhar-enabled payment system) last year," he added.
"Our
MSMEs have also rapidly adopted FinTech solutions whether for credit,
payments, accounting & tax filing. Government has recently launched
the Open Credit Enablement Network (OCEN) & Account Aggregator (AA)
framework. These enable formal credit flow to the most vulnerable
segments, especially particularly small businesses, brings Ease for
financial institutions to reach large segments, by lowering distribution
costs and now institutions can give smaller loans, with short repayment
cycles," he said.
The
Minister said India's FinTech industry came to the rescue of people at
the time of pandemic, by enabling them to carry out critical activities
from the safety of their homes, particularly during the lockdown &
the 2nd wave of Covid.
"As
Prime Minister Modi says, ‘every crisis can be converted into an
opportunity’, now citizens do not have to go to the banks, the banks
have come to their homes and on their mobile phones," he said.
Goyal said, under the visionary leadership of the Prime Minister Narendra Modi India underwent a digital transformation in Mission
Mode since he announced the Jan Dhan Yojana in his first Independence
Day speech on assuming office, on 15th August 2014. More than 2 crore
accounts were opened under the scheme, which has been considered a world
record, he said.
"JAM
trinity, besides DBT, has brought in transparency, integrity and timely
delivery of financial benefits and services to India's vast population. JAM trinity has enabled India to leverage its technical capabilities
for developing Fintech sector", he said.
The
Minister said, under the National Broadband Mission soon every village
in India will have high speed internet and this power can be leveraged
to make India a Fintech Innovation Hub.
"I
believe India is poised to become one of the largest digital markets
with rapid expansion of mobile & internet networks. As India aims to
become Aatmanirbhar, we want our industry & entrepreneurs to use
local talent to produce globally marketable solutions," he said.
Goyal said, FinTech today has the potential to bring investments for
mobile apps, e-commerce stores & several other digital
infrastructures.
"Investment
inflow in the Fintech sector which has gone up to $10Bn since it
started in 2016 has the huge potential to “Up the Game”, it will
simultaneously enhance customer experience. Your strength will be
augmented by the world’s 3rd largest Startup ecosystem which is hungry
for growth," he said.
An interesting development is the emergence of embedded finance. The non-financial services sectors are also proactive in adopting FinTech solutions today.
Goyal said that with the expansion of their value chains, we need to
consume more and more fintech services will grow proportionally.
"Our
MSMEs have also rapidly adopted FinTech solutions whether for credit,
payments, accounting & tax filing. Government has recently launched
the Open Credit Enablement Network (OCEN) & Account Aggregator (AA)
framework. These enable formal credit flow to the most vulnerable
segments, especially particularly small businesses, brings Ease for
financial institutions to reach large segments, by lowering distribution
costs and now institutions can give smaller loans, with short repayment
cycles.
The Commerce Minister said, India is today one of the fastest growing Fintech markets with more than 2,100 FinTechs.
"A
lot of Indian Fintech markets are unicorns and India’s market is
currently valued at $31 Bn, and expected to grow to $84 Bn by 2025," he
said.