India poised to become key digital market in world: Piyush Goyal
At 87%, India has the highest FinTech adoption rate in the world
India is poised to become one of the largest digital markets in the world with rapid expansion of mobile and internet as the country is one of the fastest growing markets with over 2,100 fin techs, said Union Minister of Commerce and Industry Piyush Goyal.
“I believe India is poised to become one of the largest digital markets with rapid expansion of mobile and internet networks. As India aims to become Aatmanirbhar, we want our industry and entrepreneurs to use local talent to produce globally marketable solutions,” Goyal said while addressing the 2nd Global Fintech Fest-2021 through video conferencing on Thursday.
“At 87%, India has the highest FinTech adoption rate in the world against the global average of 64%,” he stated.
“As of May 2021, India’s United Payments Interface (UPI) has seen participation of 224 banks and recorded 2.6 billion transactions worth over $68 Bn and the highest ever, more than 3.6 Bn transactions, in August 21,” he said.
“Over 2 trillion transactions were processed using the AePS (Aadhar-enabled payment system) last year,” the Minister added.
He 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 and 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,” the Minister stated.
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, he noted.
More than 2 crore accounts were opened under the scheme, which has been considered a world record, the Minister added.
He mentioned that Jan Dhan-Aadhaar-Mobile or JAM trinity, besides DBT, has brought in transparency, integrity and timely delivery of financial benefits and services to India’s vast population.
The Commerce and Industries Minister said JAM trinity has enabled India to leverage its technical capabilities for developing Fintech sector.
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, he informed.
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 Minister noted.
The non-financial services sectors are also proactive in adopting FinTech solutions today, he observed.
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,” he mentioned.
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 Minister added.
He 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,” the Minister informed.