Businesses are continuously evolving and with every technological advance, there is scope for new markets, and an opportunity to convert ideas into reality. The finance sector has seen a complete makeover thanks to the advent of fintech platforms and modern technology. The last decade has seen a reinvention of traditional business and finance practices.
What are Fintech platforms?
FinTech is basically a combination of finance and technology. The term refers to a new group of firms that use cutting edge technology to offer financial solutions which are significantly more efficient and effective than those provided by traditional financial institutions.
Present day technology has played a significant role in the financial sector. Modern banking or financial services would struggle to stay afloat in the absence of technology. However, Fintech should not be seen as a replacement for traditional banking services, but as a sector which was born to ease out the burden on banking services. It is a result of the inevitable evolution of the banking space with the introduction of new technology.
Indian Fintech Landscape
There are several traditional banking functions which are being taken up as individual services by various companies. Firms are now focusing on certain areas of banking functions, such as:
- Digital Lending
These firms are equipped with providing flexible options for financing to SMEs as well as consumers. Companies are using this technology to create better financial products, improve customer experience and increase the speed of loan approvals.
- Payment Services
Individuals and businesses are allowed to accept payments without the need of swiping a credit or debit card. The only requirement for these transactions is a smartphone, as all payments are made online.
- Insurance
Fintech platforms have helped the document-heavy insurance sector to become paperless. Firms are now enjoying the ease of decision making at the consumer end by aggregating insurance provider data and simplifying the application experience.
India catching up with the world
Globally, the FinTech sector received an investment of a whopping $5.4 billion in the first quarter of 2016, according to figures published by Accenture. India is catching up fast, as there is room for massive growth. Indian Fintech platforms, between 2014 and 2015, have recorded $1.77 billion in investments through a total of 158 deals, according to Inc42’s FinTech Market Report 2014-2016. The FinTech sector has new businesses that would need help and guidance in reaching their true potential. In an extremely challenging, cost-conscious Indian market, incubators and accelerators can be mentors for these businesses.
