India has been a force to be reckoned with in the field of financial technology for some years now. While New Delhi is the political capital, Mumbai is very much the country's business capital and indeed the FinTech capital, with around 400 companies working in this field established there. Tracxn estimates that close to $2 billion was invested in Indian FinTech startups between 2015 and 2016. Mumbai, which hosts not only the country's five largest banks but also a number of startup accelerators – Rise, Startup Bootcamp and Zone Startups India to name but three of them – provides an excellent base for financial technology specialists and furthermore shows the highest ROI in the world from financial technologies (29%, compared with a worldwide average of 20%). A survey carried out by Indus Valley Partners among Indian Engineering and MBA students reveals that 63% of the respondents has the means to become the world FinTech centre. However, around a fifth of the students polled remain skeptical on this point, expressing the opinion that the country is not ready for this in general terms, while 17% reckon that, with a largely cash-based economy, India is not yet ready to embrace the FinTech revolution. Nevertheless, since the Indian Central Bank withdrew all 500 and 1000 rupee notes in November 2016, Indian citizens have been turning in droves towards digital transactions, which have increased by not less than 400%. This turnaround has been boosted by the Unified Payments Interface introduced by the National Payments Corporation of India (NPCI), which requires interoperability – i.e. transactions must be feasible between all payment systems run by various parties. For instance, funds can be transferred between different bank accounts, using a unique identifier plus PIN code. The Indian government seems to be making a strong push towards inclusion for all in the banking system, as shown by the Aadhaar ('Basis') national program to introduce biometric identification.
By Marie-Eléonore Noiré