Traditionally, banks and similar financial institutions have been the major players in the financial ecosystem in the country. But with the emergence of FinTech startups in India, the scene is changing pretty fast. Various aspects of banking including lending, payment, asset management, and equity finance have been impacted, and many see this as a welcome development in a sector that has lagged behind in offering ample options to meet the demands of a modern market.
Though FinTech is still at a nascent stage in India, the question that is being asked is whether they are merely disrupting banking services or working towards making the financial ecosystem ready for the new-age demands. The jury is still out on that but looking at the latest trends, it seems FinTech companies hold the promise to improve the financial market.
Here’s how they are doing it
Helping banks to reinvent themselves
Digital transformation in the banking sector was long overdue. The popularity of FinTech enabled services like digital wallets, and online money lending has propelled banks to engage themselves with emerging innovations including better, faster, and cheaper services.
Offering greater convenience
FinTech has made making payments, keeping track of one’s finances, and comparing investment policies much simpler. You can make online payment of your bills, pay taxi fare or lend or borrow money with just a click of the button. In today’s world where we are hard pressed for time this convenience of doing your financial transactions sitting at home is certainly a boon.
Providing more options
When it comes to making financial investments, the advice of not putting all eggs in one basket is the right one. But traditional financial institutions don’t offer a variety of financial instruments to choose from and whatever they offer do not give very high returns. FinTech companies are changing this. They not only offer better, more flexible and high return investments options but do so with better online experience. For instance, TachyLoans, a personal loan online provider allows its lenders to lend money to an unlimited number of borrowers and earn a relatively higher return on investment [anywhere between 11.5 % and 25%].
Contributing to the vision of Digital India
By making available a host of financial services electronically, FinTech startups in India are accelerating the vision of Digital India. As digital wallets, online payment, and P2P loans in India have become more common; a digitally empowered Indian financial ecosystem is slowly becoming a reality.
In short, FinTech is going to have a lasting impact on the financial environment of the country and hopefully change it for the better.