India - A Global FinTech Superpower

India is amongst the fastest growing Fintech markets in the world. Indian FinTech industry’s market size is $ 50 Bn in 2021 and is estimated at ~$ 150 Bn by 2025.

The Indian Fintech industry’s Total Addressable Market is estimated to be $ 1.3 Tn by 2025 and Assets Under Management & Revenue to be $ 1 Tn and $ 200 Bn by 2030, respectively

Major segments under Fintech include Payments, Digital Lending, InsurTech, WealthTech

  • The Payments landscape in India is expected to reach $ 100 Tn in transaction volume and $ 50 Bn in terms of revenue by 2030
  • India's digital lending market was worth $ 270 bn in 2022 and is expected to reach $ 350 bn by 2023
  • India is the 2nd largest Insurtech market in Asia-Pacific and is expected to grow by ~15X to reach $ 88.4 Bn by 2030; India is poised to emerge as one of the fastest growing insurance markets in the world
  • The Indian WealthTech market is expected to grow to $ 237 Bn by 2030 on the back of a growing base of retail investors
  • Bn+

    Monthly volume of digital payments

  • %

    Of all retail digital payments in India is UPI

  • Fintech Unicorns

  • $ Bn

    Fintech Funding (2014-2022) (approx)

3rd largest fintech ecosystem globally

#2 Fintechs founded globally

1 for Real-time payments globally (46% of all real-time transactions worldwide in 2022)

Industry Scenario

Fintech Funding & Valuation    

The Fintech sector in India has witnessed funding accounting to 14% share of Global Funding. India ranks #2 on Deal Volume. The Fintech Market Opportunity is estimated to be USD 2.1 Tn by 2030. Indian fintechs were the 2nd most funded startup sector in India in 2022. Indian Fintech startups raised USD 5.65 Bn in 2022. The total number of unique institutional investors in Indian fintech almost doubled between 2021 and 2022, rising from 535 to 1019 respectively.

Digital Payments

  • Volume of UPI transactions increased 200x from January 2017 (4.5 Mn) to January 2023 (10 Bn), and the Value increased 600x during the same period
  • UPI recorded the highest ever volume of transactions in April 2023 – 8.8 Bn
  • Daily transactions on the UPI platform can touch 1 Bn by 2025
  • Digital Payments increased by 76% in transactions and 91% in value (2022)
  • A pan-India digital payments survey (covering 90,000 respondents) revealed that 42% of respondents have used digital payments
  • Acceptance of digital payments infrastructure has increased from 170 Mn touch points to 260 Mn touch points (increase of 53%)

Regulatory landscape

  • India Stack: A set of APIs that allows governments, businesses, startups and developers to utilise a unique digital infrastructure. One of the most important digital initiatives undertaken globally, aimed at putting up a public digital infrastructure based on open APIs to promote public and private digital initiatives. The ‘’ website serves as a single repository of all major projects on India Stack.
  • JAM Trinity:
    • Jan Dhan Yojana: The world’s largest financial inclusion initiative, “Jan Dhan Yojna”, has helped in new bank account enrolment of over 480 Mn beneficiaries
    • Aadhaar: The world’s largest biometric identification system (1.3+ Bn Aadhaars generated so far)
    • Mobile connectivity: India has the 2nd highest number of smartphone users
  • Cross border linkage of India’s fast payment systems (UPI & RuPay network – QR code & P2M based payments) with other countries, is aiding in enhancing the global footprint.
  • Financial Inclusion: India’s financial inclusion has improved significantly over calendar years 2014 to 2021 as adult population with bank accounts increased from 53% to 78%.
  • Financial Literacy: The RBI has set up the National Centre for Financial Education and plans to expand the reach of Centres for Financial Literacy (CFLs) to every block of the. These steps aim to promote financial education across India for all sections of the population.
  • Introduction of UPI123Pay and UPI Lite: Allows access to UPI to 400+ Mn feature phone subscribers and facilitates low value transactions in offline mode through on-device wallet.
  • RBI Payments Vision 2025: The RBI plans to achieve certain outcomes such as 3x increase in number of digital payment transactions, increase of registered customer base for mobile based transactions by 50% CAGR, increase in PPI transactions by 150%, increase of ard acceptance infrastructure to 25 Mn by 2025.
  • Account Aggregator Framework (AA): AA is an advanced framework of sharing consent based financial information between Financial Information Providers (FIPs) and Financial Information Users (FIUs). With 23 Banks onboarded to the AA framework, more than 1.1 Bn bank accounts are eligible to share data on AA. 3.3 Mn users have linked their accounts on the AA framework and shared data. RBI has also notified GSTN as FIP which will enable digital invoice financing and provide much-needed credit to the MSME sector.


  • India stack

    Open API platforms i.e. Aadhar, UPI, Bharat Bill Payments, GSTN

  • Technological Innovation

    Implementation of new business models driven by technologies such as Artificial Intelligence and Machine Learning

  • Increasing internet & smartphone penetration

    India already has the 2nd highest number of smartphone users globally and is the 2nd largest Internet user market. ~1 Bn Internet Users by 2026. The number of households with internet connections with an increase by 46%, reaching 233 Mn households by 2026, compared to 160 Mn in 2021

  • Favourable Demographics

    68% of India’s population is young and 55% of its population is in the age group of 20-59 (working population) in the year 2020 and is estimated to reach 56% of the total population by 2025. By 2030, India will add 140 Mn middle-income and 21 Mn high-income households which will drive the demand and growth of Indian FinTech space.

  • Financial Inclusion Initiatives

    Financial inclusion programmes such as PMJDY, DAY-NRLM, Direct Benefit Transfer, Atal Pension Yojana among others have accelerated the digital revolution and brought more citizens, especially in rural areas, within the ambit of digital financial services


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Fintech Unicorns : India

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Asked Questions

What are the initiatives being taken for the FinTech space in India?

To enable regulated and orderly growth of FinTech ecosystem in India, several steps are being taken by different regulators:


a)    Reserve Bank of India (RBI)
•    Setting up of a regulatory sandbox, which was established based on the recommendations of Working Group on FinTech and Digital Banking, set up by Financial Stability and Development Council - Sub Committee (FSDC-SC). Within the sandbox, the eligible entities can live test their innovative products or services in a controlled environment. RBI Sandbox is based on thematic cohorts; the first cohort was on Retail Payments, the second cohort was on Cross Border Payments, and the third cohort, which was recently opened by RBI, on MSME Lending. To know more about this, please visit the RBI website here.
•    Innovation Hub is an entity set up to promote innovation across the financial sector by creating an eco-system that facilitates access to financial services and products. The Innovation Hub is expected to collaborate with financial sector institutions, technology industry and academic institutions and co-ordinate efforts for exchange of ideas and development of prototypes related to financial innovations, as well as develop infrastructure to promote FinTech research and facilitate engagement with innovators and start-ups. To know more, please click here.
•    HARBINGER 2021-Innovation for Transformation is a global hackathon with the theme ‘Smarter Digital Payments’. The Hackathon invites participants to identify and develop solutions that have the potential to make digital payments accessible to the under-served, enhance the ease of payments and user experience, while strengthening the security of digital payments and promoting customer protection. To know more, please click here.


b)    Securities Exchange Board of India (SEBI)
•    Regulatory Sandbox has been launched by SEBI with the aim to grant certain facilities and flexibilities to the entities  regulated  by  SEBI  so  that  they  can  experiment  with FinTech solutions  in  alive environment and on limited set of real users for a limited time frame. To know more, please click here.
•    Innovation Sandbox will Innovation Sandbox facilitates access to an environment provided  by Enabling  Organizations like Stock Exchanges, Depositories and Qualified Registrar and Share Transfer Agents, wherein innovators would  be  testing  their innovations  in isolation  from the live  market  and  would be used  for offline  testing  of the proposed solution of the applicant. To know more, please click here. You can also visit .

c)    Insurance Regulatory and Development Authority of India (IRDAI)
•    Regulatory Sandbox has been created by the IRDAI with the objective to use innovative ideas to foster growth and increase the pace of most innovative companies, in a way that provides flexibility in dealing with regulatory requirements and at the same time focussing on policyholder protection. Recently, the IRDAI has extended validity of its sandbox regulations by another 2 years. To know more, please visit

d)    International Financial Services Centres Authority (IFSCA)
•    Regulatory Sandbox framework has been launched by the IFSCA. Under this framework, entities operating in the capital market, banking, insurance and financial services space will be granted certain facilities and flexibilities to experiment with innovative FinTech solutions in a live environment with a limited set of real customers for a limited time frame. These features will be fortified with necessary safeguards for investor protection and risk mitigation, and the Regulatory Sandbox shall operate within the IFSC located at GIFT City. For more details, please visit .

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Which are some of the key regulatory authorities that are working towards the development of the FinTech sector in India?

·       RBI – RBI is India's central bank and regulatory body under the jurisdiction of Ministry of Finance, Government of India, and regulates the banking and financial system, payment and settlement systems, the foreign exchange regime, and the currency system.

·       SEBI – SEBI is the regulatory body for securities and commodity market in India under the jurisdiction of Ministry of Finance, Government of India, and regulates the securities market, including securities such as shares, scrips, bonds, debentures, commodities, mutual funds and government securities.

·       IRDAI – IRDAI is a regulatory body under the jurisdiction of Ministry of Finance, Government of India and is tasked with regulating and licensing the insurance and re-insurance industries in India.

·       IFSCA- The IFSCA is a unified authority for the development and regulation of financial products, financial services and financial institutions in the International Financial Services Centre (IFSC) in India. At present, the GIFT IFSC is the maiden international financial services centre in India.

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What licenses are required for different activities in the FinTech sector?

For undertaking Banking services or Payments, clearing and settlement services or Lending services – certain licenses / approvals from the RBI will have to be taken. For more information in this regard, please visit

For undertaking Securities trading activities, certain licenses / approvals will have to be taken from SEBI. For more information in this regard, please visit

Depending on the nature of the Investment management / advisory services or Market Provisioning services, approvals may have to be taken from IRDAI or SEBI or RBI or other sectoral regulators.

Cloud-based information technology services may require approvals under the Information Technology Act, 2000 and/or Information Technology (Intermediaries Guidelines) Rules 2011 from the Central Government and/or the relevant Ministry, or other sectoral regulators.

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How is the use of FinTech in alternative finance activities regulated?

•    Peer-to-peer lending - Non-banking financial company-peer to peer (NBFC-P2P) platforms are governed by the NBFC-P2P Lending Platform Directions 2017, issued by the RBI. An NBFC-P2P is defined as a non-banking institution that acts as an intermediary to provide loan facilitation services, whether online or otherwise, to participants. This does not include loan facilitation services for institutional lenders such as banks or NBFCs. Any FinTech activities related to NBFC-P2P, will require approvals from the RBI. 

•    Payment platforms - The Reserve Bank of India has notified Guidelines for the Trade Receivables Discounting System (TReDS Guidelines) setting up an institutional mechanism for financing trade receivables of Micro, Small and Medium Enterprises (MSMEs) from corporate and other buyers including government departments and PSUs. TReDS covers clearing and settlement activities and is regulated as a payment system under the Payment and Settlement Systems Act 2007. For more information in this regard, please click here.

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How are payment services regulated in India?

RBI regulates payments-related activities in India and issues circulars and directions applicable to different payments-related activities. Payment services are regulated under the Payment and Settlement Systems Act 2007. A payment system is defined as ‘a system that enables payment to be effected between a payer and a beneficiary, involving clearing, payment or settlement service or all of them, but does not include a stock exchange’. These include credit cards, debit cards, smart cards and money transfers. Any entity interested in commencing a payment system is required to obtain authorisation from RBI.

The payment providers broadly fall under the following categories: payment aggregators and payment gateways, prepaid payment instruments, financial market infrastructure (clearing houses), retail payment organisations, card payment networks (Visa, MasterCard, etc), cross-border money transfers, ATM networks, white-label ATM operators and instant money transfer.

There are three types of prepaid payment instruments: open payment instruments, which are payment instruments that can be used to make a payment to any merchant; semi-closed, which are payment instruments that can be used to make payment to a defined set of merchants; and closed, which are payment instruments of a merchant for payment only to that merchant.

For more information, please click here.

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