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Migration Towards FinTech in India: Startup Perspective

When we started in 2012–13, the industry was not called ‘FinTech.’ In the recent past, the industry has been mentioned by various leaders such as Narendra Modi and Christine Lagarde and has been getting constant attention from the media, so what exactly is happening?

Money impacts life in all areas, and it’s no secret that today, FinTech, as we know it, tends to exert a significant influence on almost every aspect of our lives. We use FinTech for everything from our daily bill payments, loan applications, and money transfers, to simplifying business transactions. Bill Gates once said, “Banking is necessary, banks are not.” The former CEO of Barclays had said that banking is having its “Kodak moment.” This is understandable, considering that since it came into being, the world of FinTech has been attracting the world’s tech leaders who are working to disrupt traditional banking. How? They seem to have their collective fingers on the pulse of the market and are almost continually innovating products and services that are the need of the hour. If we take a look at India today, we find a vibrant, thriving FinTech ecosystem helmed by entrepreneurs and business experts who run 2035 Indian startups, ranging from WealthTech, RegTech, InsurTech, to payments, lending, big data, and more. Dig a little deeper and you can find that these entrepreneurs can be classified into two distinct segments:

The first segment constitutes those leaders that have already launched a tech company. These once-entrepreneurs have impacted millions of lives, disrupted industries in India, given value through their services/products to their stakeholders, and created brands from the bottom-up. This group of individuals evolving from their initial entrepreneurial avatars have started looking to disrupt the financial services sector in India through their new offerings in the realm of FinTech. Here are some of these individuals who have forayed into FinTech:

However, why have they chosen to start their journey again into FinTech? The reason is that FinTech is about money; money that has been held with large banks, and now, they’ve seen an opportunity where new approaches and technologies could be adopted for disrupting current models. FinTech is also related to commerce where payment (a necessity in any commercial transaction) is required to be made. FinTech is also about looking at legacy IT systems as an opportunity for disruption where there is the possibility to build a profitable business by helping traditional banks upgrade their technology infrastructure in a modular, open-API world. Last but not least, FinTech is about people and providing them with superior user experiences at their fingertips, through leveraging today’s widespread mobile technology.

But what about those on the other side of the fence – the ones who have exited their previous FinTech startups to starts new ventures in the same domain? FinTech is, overall, a very hot segment right now, and those that belong to the latter segment have understood the value of staying within the FinTech universe while expanding to newer horizons. 

Who are some of these entrepreneurs? Consider Anish Achuthan, who previously co-founded Zwitch payments, which was sold to Citrus Pay. After Zwitch, he co-founded Open, a neo-banking startup that has recently raised its Series B funding. Or, household name Kunal Shah, who co-founded Freecharge which was sold to Snapdeal. After that deal, Kunal Shah founded CRED, which aims at celebrating and rewarding the most creditworthy people in India.

One last thing since we’re on the subject: there is a rumor going around. The word in town is that Sachin Bansal may be doing something in the finance-meets-technology area – a rumor that gains credence thanks to his investment in FinTech (e.g., Krazybee and Kissht) and his acquisition of the majority stake in Chaitanya India Fin Credit through BACQ, and his role as Director at Ujjivan Small Finance Bank. With FinTech, it seems quite evident that in the startup landscape, these entrepreneurs are going from strength to strength.

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