The digital revolution has profoundly impacted not only our lives but businesses across sectors as well.This is true to such an extent that it has transitioned into an industry in itself, comprising technology, internet, and e-commerce players.
With the core business interests directly in line with the digitisation of the economy, working for the ‘financial technology’ or ‘fintech’ industry as it is popularly called, enables one to remain at the forefront of this revolution, effectively spearheading this change. Fintech is a relatively new technology branch, which has given a boost to job creation in the field of IT, software and mobile app development, data analytics, Machine Learning, and Artificial Intelligence.
Financial technology is disrupting the traditional financial market by creating technological innovations in the financial services space to make them accessible to public.
A sunrise sector
India is one of the countries which have a large unbanked or underbanked population. As an estimate, India has an 80 percent cash economy. With a robust entrepreneurial and technology ecosystem in India, it leaves the fintech industry with high growth potential and an opportunity to disrupt the traditional financial system by creating seamless digital financial solutions for end users. It is estimated that the digital payment sector in India will grow by $500 billion by 2020.
Asia has emerged as one of the promising regions for fintech players to invest. Mainly driven by India and China, increase in fintech investments in Asia to $5.4 billion in 2016, up 12.5 percent from $4.8 billion in 2015, was also one of the key highlights of the PWC Fintech Trend Report 2017. Post demonetisation, the fintech segment in India grabbed several private equity and venture capitalists’ attention.
Strong and proactive policy reforms by the government to push for a digital economy have facilitated the adoption of innovative financial technologies and solutions by the people. They have also established a foundation for the fintech companies to ride on the wave of ‘financial inclusion’ across the nation. These reforms have given a much-needed boost in shifting consumers from cash-based transactions to digital alternatives.
Along with the government’s push towards a digital India, the fast-evolving space of fintech has created ample opportunities for enterprises and startups, allowing budding entrepreneurs and professionals to broaden their horizons of learning and exposure. The state government of Andhra Pradesh is targeting the creation of five lakh jobs by 2020, powered by the spurt of fintech companies. The AP government has announced that it will set up a fintech incubator fund which will invest Rs 100 crore in startups.
Skilled talent pool
Fintech has uniquely suited the millennials, not just in terms of the fact that products and services offered by fintech speak to their particular sensibilities but also in terms of their role as the first truly digital generation in driving the market. With newer global entrants like Google and Amazon coming into the market there has been a surge of innovation in the payments space which has further increased the demand for a skilled talent pool. The use of Machine Learning or Artificial Intelligence by the fintech players has made it a hot career choice for millennials.
The key opportunities for the fintech companies around Big Data and analytics has further evolved the industry as an emerging sector.
According to KPMG International’s report, data analytics, payments and lending, and Blockchain will drive growth in the fintech space. Furthermore, technologies like Artificial Intelligence and Machine Learning are paving the way for fintech players to innovate and disrupt the traditional banking system. This has created the need for a huge skilled talent pool to be recruited by the companies.
The fintech revolution isn’t only about revolutionising the financial sector. Fintech startups have acted as a catalyst in creating job opportunities, allowing the younger generation to be a part of a dynamic and close-knit ecosystem. Fintech is a global sector without borders, with startups providing a challenging environment. The fintech industry is constantly evolving. This provides an opportunity to innovate and ideate more, allowing people to contribute towards making India a digital economy.
Fintech is becoming a game-changer, both for the financial and technology sectors. Even traditional institutions like banks, lenders, and insurance companies have acknowledged the disruption caused by fintech and are making moves of their own to keep pace.
Open innovation in fintech, led by the banking, financial services, and insurance (BFSI) sector and technology startups, can expedite growth across sectors, creating a more integrated industrial architecture. Micro, small, and medium enterprises can also benefit immensely from easy access to capital and diverse funding options, thereby boosting growth and job creation. An efficient and skilled talent pool, favourable regulatory frameworks, and potential to attract capital investments are the key enablers for the fintech sector to drive the vision of a digital India.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)
How has the coronavirus outbreak disrupted your life? And how are you dealing with it? Write to us or send us a video with subject line 'Coronavirus Disruption' to firstname.lastname@example.org