What will it take for India’s FinTech market to reach $1 trillion by 2030?

By Puja Sharma

“India is among the fastest growing FinTech markets in the world with a market size of $31 billion in 2021 that is expected to reach $1 trillion by 2030,” said Dr. V Anantha Nageswaran, Chief Economic Advisor of India, Ministry of Finance, Government of India, speaking at the Global Fintech Fest 2022 (GFF 2022).

GFF 2022 is organised and presented by the Department of Economic Affairs, Ministry of Finance, Government of India, Reserve Bank of India, International Financial Services Centres Authority (IFSCA), National Payments Council of India, the Payments Council of India (PCI) and the FinTech Convergence Council (FCC).

“A major shift towards a more equitable distribution of investment across sectors including InsurTechs, WealthTechs, etc, has started taking place. We are talking about bridging the digital divide and the economic divide. Therefore the focus now is on how the combination of technology and finance is enabling access to finance and access to opportunities,” he added.

India’s FinTech conference, GFF 2022, kick-started with a session on ‘Creating A Sustainable Financial World’. During the session, Dr. Nageswaran further added, “The next wave in the FinTech sector could be the cash flow lending to MSMEs using Account Aggregator, UPI and OCEN. The lending potential of $3 trillion next year will be based on GST invoices and bank statements made available on Account Aggregator and banks adopting OCEN.

The government is now pivoting from digital financial inclusion to digital financial empowerment. This is being done through Jan Dhan 2.0, strong gender focus, PM SVAnidhi Scheme, eKYC and digital onboarding and protection of digital customers.

In another insightful address on catalysing the growth of health insurance in India with National Health Stack, Dr. R. S. Sharma, Chief Executive Officer, National Health Authority, Ministry of Health & Family Welfare, Govt. of India, said, “The National Health Authority has successfully implemented two flagship programs – Ayushman Bharat –Pradhan Mantri Jan Aarogya Yojana (PMJAY) and the Ayushman Bharat Digital Mission that have transformed the health insurance industry.”

PMJAY is providing health insurance coverage to over 500 million people at the bottom of the pyramid to the tune of INR 5 lakhs per month, per family and is the world’s largest health insurance scheme. Today we have a huge opportunity to digitize the entire health space that will ultimately impact the health insurance industry in this country.

“We are now building the adapters from the providers’ and payers’ sides, after which the platform will ensure the interchangeability of information in a very seamless way. With standardization and cost optimization, the Health Claims Exchange will be to India’s health technology what the JAM trinity was to the country’s FinTech,” Sharma added.

Speaking about the barriers and drivers to growing digital payments for the next half a billion users, Praveena Rai, Chief Operating Officer, National Payments Corporation of India (NPCI) said, “As per the RBI Payments Vision 2025, digital payments are for everyone, everywhere, and every time, where everywhere and every time boils down to the quality of connectivity required to commit to digital payments and digital solutions. ‘Everyone’ challenges us the most because it needs to address some of the biggest barriers – affordability, access to identity, and literacy as we go deeper and broader into our markets and user base.”