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According to the India Finance Report 2019 the domestic finance sector has witnessed exponential growth in the past few years. India is now the world's second biggest finance hub with 2,035 startups operating in the sector.Mumbai and Bangalore have emerged as India's finance hubs, housing over 42 percent of the startups.
The Finance startups are one of the fastest growing industries and startups of this industry are flourishing at a faster pace. The number of Finance startups is growing much faster than it was assumed until a few years back. According to the report the finance sector raised nearly $2 billion in funding across 165 deals in 2018 alone. Payments constitute the largest share of finance startups in India.
With a population of around 1.3 billion, India is marching towards a developing economy to be amongst the leading players in the globe. The varied sectors are on the cusp of growth, with leveraging the best-in-class technologies. One being the financial sector. A big percentage of unbanked or under banked population and the act that it is a youthful nation is witnessing a high growth in digital penetration, makes India an exciting global space for Capital market. As it signifies a cash-driven nation, has taken the advantages of ascent opportunities in the financial services space. This has led to the birth of financial services startups.
These startups offer a range of options, including e-wallets, lending, and insurance, the variety of services that are of immense of importance.
Here are some of the main trends occurring in finance today as well as some of the leading companies in each category.
Trading & Investing:
Recent automated financial advisors and wealth management services are beginning to make an effect on the industry. Robot-advisors and other startups are utilizing sophisticated algorithms to make trading and investing a fully automated online experience. These automated stages are providing users enormous savings and offering financial planning services that are general reserved for wealthy investors. They are also enabling beginner investors with very slight amounts of capital to start investing. Overall automation threatens to profoundly interrupt the investment and trading space, potentially replacing numerous traditional brokers & advisors with smarter, inexpensive or more efficient algorithms.
An epic type of P2P banking driven by innovation is putting forth an elective wellspring of financing. Distributed loaning stages that utilization AI advancements and calculations are sparing people and organizations time, cash and helping a few access a credit extensionBy utilizing technology, shared loaning stages are giving borrowers a simple, quick and lower cost administration that most banks can't coordinate. Check out these leading companies.
Novel payment technologies are changing the way we do our banking, transfer money and pay for goods and services. Smart phones, contactless NFC technology & the rise of digital transactions are driving faster payments and bringing us closer to a completely cashless system. In the near upcoming, you will no longer essential a wallet filled with cash, credit or debit cards. The Just thing required to make an installment will be your cell phone. Check out these leading companies
Personal loan and Finance:
Mobil applications and online stages are presently helping people and organizations build up a spending limit, discover an advance, document their expenses and contribute.They are likewise utilizing innovation to follow every day uses and help clients dissect their money related circumstance progressively, with the objective of improving monetary security and expanding budgetary proficiency
Moving and trading cash universally is frequently a difficult and costly procedur. But new start up currency exchange companies is developing innovative platforms that make this process simpler, faster & less expensive.From distributed cash trades that decrease the expense of trading monetary forms to cell phone based cash moves stages that give a financially savvy approach to individuals to move modest quantities of cash abroad.
Capital Float startup is an online platform that provides working capital finance to SMEs in India. They offer flexibleshort-term loans that can be used to acquisition inventory, service new orders or optimize cash cycles. Borrowers can apply online in minutes, select wanted reimbursement terms and get assets in their financial balances in 3 days with negligible problem
Every startup business needs access to capital, whether for funding product development for initial rollout efforts acquiring inventory or paying that first employee. Most entrepreneurs think first of bank loans as the primary basis of money, only to find out that banks are really the least likely benefactors for startups. How financial sector helps for starts up business.
Personal credit lines: Should be qualifying for a secured personal credit line based on your personal credit efforts. We all know startups that have been made on one or together of these. The benefit is that you retain entire ownership and control, as long as you make minimum payments.
Peer-to-peer lending: this is a process whereby a group of people comes together to lend money to each other. It’s been around various years, in examples like small business groups or ethnic groups supporting similar efforts.
Crowd funding: This approach is now spreading beyond non-profits, pre-sales, and memento rewards, to soon include the ability to make small equity investments.
Vendor financing: In the event that you need substantial items for stock, numerous makers and merchants can be persuaded to concede your installment until the products are sold by you. This truly implies an augmentation of the typical 30-day installment terms to a time of months or more, contingent upon your credit value and additional charge
How technology helps financial startups business
Technology has important effects on business operations. Regardless of the size of your venture, innovation has both unmistakable and immaterial advantages that will enable you to profit and create the outcomes your clients request. Innovative foundation influences the way of life, effectiveness and connections of a business.
FinTechs startups are one of those industries which came to existence because of the extensive use of the internet. FinTech organizations give online budgetary administrations of different sortThe FinTech industry is never confined only up to using the internet in banking; the potentialities are much beyond banking.
The FinTech industry is one of the fastest growing startup. Along with the growing number of companies, the competition among the startups is getting tougher. The companies which are leading the race are ahead of the rest as they follow the FinTech trends. If you own a FinTech startup or plan to start one, you must advance your business with the trends that are implemented to the FinTech startups.
The block chain is the technology which can make the banking easier and much more secure than ever before. With the help of this technology, the transactions will be much faster and less expensive. The data saved in block chain can never be manipulated by fraudulent borrowers. Many of the Indian financial institutions have adopted this technology and working on the application of the same in the business. The block chain technology can be used in numerous fields and the use of the same in Fin Techs can take the business to the next level.
Artificial Intelligence (AI):
The use of Artificial Intelligence can help companies to make the right lending decision. The testing on this technology has been in process for many decades and this technology has gained acceptance in many areas including finance. Some of the branches of AI such as NLP (Natural Language Processing) or virtual customer assistants (VCA) are ready to launch in the FinTech sector. Fintechs can use AI featured chatbots, customer assistance and maintenance services which are certain to provide services more effectively by eliminating human intervention.
The Voice Technology:
This is the latest technology that is about to implement in FinTech. The voice technology in banking is inspired by Alexa and Google Assistant. Modern banks are trying to implement this AI driven voice technology to improve the customer experience. This application has a voice recognition feature too which will make the transactions much reliable and authentic.
Internet of Things:
The IOT is known as Internet of Things is about to connect more than 50 billion devices. The impact of IOT will not exclude the finance sector. The use of IOT will turn the bank branches to smart bank branches; will connect to the wearable and devices to making the banking experience swifter and robust.
Unified Payments Interface (UPI):
The use of UPIs is about to increase significantly in the upcoming days. The UPI will encourage digital payments which will make lending and borrowing faster. The FinTech startups are to introduce highly user-friendly websites so that quick financing can be done. The FinTech startups need to speed up the lending process to make their presence visible in the midst of high competition.
Giving your FinTech business a new interface by following the FinTech trends will give a new face to your business. There are many companies who can help the startup FinTechs and outsource those advances applications to implement in their business.
Ella Ava is a financial expert and a renowned blogger. She has more than 5 years of experience in writing as well as in working for various loan companies. Currently, she is working at Finance.