Financial Technology in India
Fintech
working of Fintech
According to the pwc Global Fintech Report 2016,77% of financial institutions aim to incorporate block chain into their operations, and 90% of payment companies plan to use block chain in 2020.It is estimated that cumulative investment in fintech will exceed us$150 billion with in 3 to 5 years . This prediction , however , could be affected by the global
2) Mobile payments
3)Robo-Advisors
4)Insuretech
5)Regtech
past, present and future financial industry
Top 8innovative Fintech solutions & offerings
. India s fintech industry
Fintech is generally called as "financial Technology" it includes education, retail banking, fundraising, investment manage-
ment .It also includes cryptocurrencies such as Bitcoin.
Financial Technology refers to software and other modern technologies used by businesses that provide automated and improve financial services.
In general fintech refers to new technologies that seek to improve and automate the use and delivery of financial services.This category of startups include anything from mobile payment apps,to roboadvisors ,to cryptocurrency.
Basically it is the backend technology
Systems of financial institutions like banks, Including activities such as interna-
tional money transfers and depositing che-
Ques using smartphones with time,the scope of the term broadened to include sectors like financial education, retail banking, fundraising and non-profit,and investment management.
China,closely followed by India,is leading the way in the fintech market, with more than half of consumers using services like money transfer, financial planning, barrowing and insurance.
The peer-to-peer lending plaform venmo,owned by PayPal holdings, disrupted the bank-dependent system of lending and barrowing between peers by almost eliminating the need for bank.To combat the rise of apps like this, traditional banks are heavily investing in fintech.For example, Goldman Sachs group Inc launched a mobile banking app called Marcus which provides commission free saving accounts.
There are about 26fintech unicorns(unicorn it mean they raised us $1 billion or more) globally .The fintech market worldwide was valued at US$127.66 billion in 2018,and is predicted to grow to us $309.98 billion in 2022.
Corona virus outbreak.
Applications of Fintech
1) crowdfunding platforms
Crowdfunding platforms like Kickstarter, GoFundMe, and patreon are the result of developments in fintech.The platforms allow entrepreneurs and early-stage businesses to raise funds from all over the world , allowing them to bypass geographical boundaries and reach international markets and investors.
Mobile payment applications and gateways are one of the most prevalent uses of fintech.such application allow users to carry out banking activities without physically visiting a bank companies like venmo and Interacallow customers to send and receive money Through smartphones at minimal transaction fees.
Robo-Advisors are online investment management services that use algorithms to optimally allocate assests and generate portfolios for customers.They allow users of all age group to engage in investment activities at low fees with minimal manual effort.
The term insure tech refers to the application of technology to the insurance model, which allow companies to provide tailored insurance services and data security.Insuretech helps stream line the insurance process through online claims filing and policy management.
Regtech (regulatory technology)focuses on the automation of compliance processes for financial institutions .It offers fast and cost-effective management of large amounts of data, including transaction records and compliance documents ,such as corporate tax returns.
In the past 1950s brought us credit cards to ease the burden of carrying cash and allowing consumers to pay overtime.The 1960s brought us ATMs.
1970s, electronic stock trading began on exchange trading floors.The 1980s saw the rise of the personal computer and software that enhanced our financial agility.In 1990s with the rise of the internet , e-commerce business models emerged and began to flourish.online stock brokerage websites,aimed at retail investors,replaced the telephone driven retail stock brokering model.The introduction of PayPal in 1998 addressed peer-to-peer payments online.
Now recent emergence of Fintech 2.0 is significantly different in that the technology is largely begin driven by artificial intelligence and greater computing power.
In future as there is rapid change in the development and implementation of technology development applicable to financial services,it is difficult to predict the future.nevertheless there are some key trends,two sided market places and the aggregator of payment flows will develop into financial services platforms including but not limited to payment apps,roboadvisory services for wealth with retirement planning, on demand insurance distribution as well as HR services including payroll and benefits. These platform services may in the end do more than provide transportation or e-commerce.
Technologies involved in fintech
Artificial intelligence, machine learning are some of the most used technologies in fintech.
Financial Technology has been used to automate investments, insurance, trading, banking services and risk management.In trading on capital market s, innovative electronic trading platforms facilitate trades online and in real time.
1) peer to peer (p2p) lending.This is the best example of a win-win situation for bothlenders and barrowers.
2) Alternative credit scoring.
3) Transaction delivery.
4)small ticket loans.
5) Alternative insurance underwriting.
6) Digital wallets.
7) Digital banking.
8) payment gateways.
The Biggest fintech companies
* Sofi
* Robinhood
* Wfax
*Oaknorth
* Open door
* Ola-ola money is an Indian company which provides you digital options for post payments and credit cards among other services
*Compass-compass is a US based company and according to our list is the biggest fintech company in the US.
*Paytm,Itzcashcard, Mobikwik, financial software and systems
Fintech in India
Indian fintech is one of top five markets by value of capital funding and investments in sector with nearly $270 million of funding in 2016.
Indian fintech companies have the potential to reshape the financial services landscape in three ways
* The fintech startups are likely to reduce costs and improve quality of financial services .Not being burdened with legacy options,IT systems, and expensive physical networks, benefits of learner operatingmodels can be passed on to customers.
* The fintech industry will develop unique and innovative models of assessing risk leveraging big data, ml and alternative data to underwrite credit and develop credit scores for customers with limited credit history will improve the penetrationof financial services in India.
* fintech will create a more diverse ,secured and stable financial services landscape. Fintech companies are less homogenous than incombent banks and offer great learning templates to improve both capability and culture .
Problem facing by fintech
Challenges that fintech startups face in India
* Unbanked and under banked populations
*Trust in cash
*Cyberthreats
*Lack of support from government
*Industry related complexities
*Regulatory and compliance laws
many laws inevitable contribute to the slowdown of the fintech startups in Indian financial markets.
The banking industry of 2030 will look verydifferent from what it looks like today - some of what we see will be evolutionary and some will be radically different. Whilst predictions into the future are always fraught with uncertainty, we are confident that the landscape will be far
competitive, efficient and innovative in deliveringconsumers “autonomous experiences” thatare not possible today.
The market-leading banks of tomorrow will
understand that technology will not limit whatis possible. Instead they will harness digitalcapability to put the customer firmly in controlof their destination and preferred model for dealingwith their bank and other service providers.
This is not a one-size fits all.Some consumers will opt for an autonomousbanking experience when they are time poor,lack knowledge and have high levels of trust in their bank to do the right thing by them andconfidence in their competence to do what they
say they will do.
And others will want more
hands-on involvement – it will be their choiceand the winning Bank of the Future will beadaptive to their needs.
Crucial to this is understanding how technologyis re-shaping the way people work, live andplay and embracing this deeper knowledge tohelp consumers manage increasingly complex,
fragmented lives whilst giving them the
confidence that their data is safe and secure.
The Future of Digital Banking report is designed to stimulate thinking about how the banking industry can be smarter and better, positively impacting on consumers, their relationship with money and through this, their financial wellbeing.
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