Insights

Things to Know India’s Fintech Industry from Other Fintech Industry

According to the report from the Accenture, the global investments in the fintech industry have been tripled in the year 2014 up to 12.21 million US dollars. Fintech is becoming a hot spot for the investors and it is attracting the big companies all over the world towards itself. The growth of the fintech industry has been drastic and the global market has also witnessed the pace of the growth of the fintech industry in the global economy.

The present scenario of the fintech industry in India is very shocking. There are approximately 750 companies in the country which have been established in the past few years. Out of these 750 companies, 125 startups emerged in the year 2015 itself. These facts and figures are just the outline of the landscape of fintech industry in the Indian market. But fintech has involved itself deeply into the Indian market, and not just Indian market but the global market is also highly involved with the fintech industry.

Talking about the association of the fintech industry with the global market, LendingClub and Prosper are the strong players in the industry. These companies have reached the heights in the fintech industry till now.

When compared to these big companies, Indian fintech industry is just a small fish in the ocean. The fintech needs to develop in the country. The perspective of the Indian fintech industry from those of the big shots in the global market was discussed in the 2 day meet in San Francisco, USA at Lendit.

Here are some of the perspectives of the global fintech industry about the Indian fintech industry –

  • The Founder and CEO of Upstart have suggested the Indian fintech market to learn and develop new underwriting strategies from all over the world. Upstart is a lending company which have developed a new strategy to increase the target percentage of lending from 40% to 80%. The increase in the percentage involvement has been done by developing a new model on the studies based upon the education and employment information.
  • The Indian fintech industry needs to develop stronger risk compliance and regulations on alternate lending. The major companies like the LendingClub and Prosper are following the idea of alternate lending. These companies have laid out specific regulations so that everything is unbiased and the risk strategies are robust.
  • Though the Indian fintech industry has developed very soon but there is yet more to achieve so as to gain profits. The investors in the fintech need to create a benchmark to an index. Some changes in the credit or risk policy can bring about returns in the investments.
  • Indian fintech market has not stepped into the operation of the securitization and hybrid lending models. Many big companies in the US are securitized and follow hybrid lending models to gain profits.
  • With the billions of new- to-credit people in the country, the Indian fintech market is unable to ensure the credit access. The customer acquisition by the Indian fintech industry in India is very expensive. Innovative models have to be created for the same.
  • The customer information verification is an important aspect. With the wrong information, the most apt algorithm will also underperform. Upstart still follow a five minute verification call for the legitimacy of the information.

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