Fintech in India: growth initiatives to nurture local talent
Fintech has transformed the way businesses operate and the way customers deal with banks, connect with services and make transactions. As such, global fintech is expected to grow progressively and reach a market value of approximately $305 billion by 2025, climbing at an annual rate of about 22.17% over the forecast period 2020-2025, according to the Global Fintech Market Research Report.
Undoubtedly, most countries are putting digital at the very center of their recovery. India is no exception. With over 700 million internet users, rising consumption needs will drive more extensive Fintech adoption and innovation. As such, the government aims to encourage local talent in fintech, inspire investment and improve overall quality of life for citizens.
Local initiative benefits
How will fintech companies benefit from the new government initiative in Gujarat?
- EPF, electricity and duty exemption and stamp duty exemption for five years.
- Extra FSI (Floor space index) to the buildings erected for the fintech industry, as in the government land will be given to industries on long-term lease of up to 50 years at 6 per cent of the market rate.
- Sops (standard operating procedure) will also be given for the development and training manpower and to help workers carry out complex routine operations.
“The companies which want to shift their operations from China and other countries in the wake of Coronavirus pandemic are welcome to set up base in Gujarat,” Chief Minister Vijay Rupani said. “In this time of the Coronavirus pandemic, we are coming out with a policy with an aim to create more jobs, increase manufacturing and have an innovation-driven ecosystem towards making `Atmanirbhar’ (self-reliant) Gujarat.”
The Gujarat government intends to create an ecosystem around Gujarat International Finance Tec-City (GIFT) to attract entrepreneurs of fintech companies and develop trained manpower for the sector, as well as developing an information technology driven financial services ecosystem. The vision that the city has cannot be achieved without state-driven initiatives and augmenting digital infrastructure.
Other fintech successes
India is the world’s second largest fintech ecosystem after the United States, according to the Indian fintech report which cites that, “Indian fintech surpassed Chinese fintech in raising funds for the first time, last year.”
Many other fintech startups have succeeded in several areas of India like Paytm which is an Indian E-commerce payment system and technology firm, based in Noida, Uttar Pradesh, India. It offers complete payments and financial solutions to consumers, offline merchants and online platforms with a target to bring half a billion Indians into the mainstream economy.