London-based research agency, Findexable, recently released the 'Global Fintech Index 2020'. It claimed that this is the first fully global fintech index covering over 230 cities across 65 countries. Based on its findings it would be safe to state that India is emerging as a fintech hub.
As per the 'Global Fintech Index 2020', among the world's 100 leading fintech cities, six are based in India. These include Bangalore, Mumbai, New Delhi, Pune, Hyderabad, Chennai and Ahmedabad.
The report compared how India and China play out in the fintech game. It found that China has been remarkably successful at simultaneously driving financial and digital inclusion across its population. The country has also created a set of new financial services companies with transaction volumes, which makes those of the western countries pale in comparison.
However, the survey noted that when it comes to the diversity of fintech hubs, it’s India, not China, which wins in the first global rankings of fintech ecosystems. The growing acceptance for fintech in India is largely because of the rising number of internet users in the country.
This is also reflected in the investment that the sector is attracting. According to Findexable, India saw 23 venture investments in fintech firms in the second quarter of 2019, as compared to 15 in China. The India Fintech Report 2019 highlighted that around 2,035 startups are currently operating in the sector, up from 737 in 2014. According to reports, the Indian fintech sector raised almost USD 2.34 billion in equity funding, which is 300% more than USD 593 million it garnered in 2016.
Fintech in the country got a big boost after demonetisation, which gave digital banking a shot in the arm. This led to the emergence of non-banking financial companies and fintechs like Paytm, Google Pay, Amazon Pay, RuPay, etc. Banking and financial organizations too embarked on a digital journey and started investing in fintech technologies to make seamless transactions possible for their growing customer base.