| | March 20218I ndia's FinTech sector is young but is growing rapidly, fuelled by a large market base, an innovation-driven start-up landscape, and friendly government policies and regulations. FinTechs today have forever altered the way we make payments, take loans and invest. On the other hand, traditional financial institutions have realised the importance of adopting technology and have begun to see the value of partnering with these FinTechs in a more collective approach. FinTech businesses are conveying advancement that was deemed hard to accomplish.CHALLENGES THAT INDIAN FINTECH COMPANIES FACE1. Regulation - A full-fledged regulatory frameworks and policies are required to alleviate the potential risks. A regulatory retreat will be positive for the early-stage FinTech entrepreneurs as the burdens they face to launch their businesses will wane. Regulating the FinTech industry will be a positive move as it will weed out `non genuine' businesses and will promote transparency for both businesses and investors. 2.Lack of Trust - Consumers are still not able to trust these tech practices, and they dedicatedly follow conservative and traditional practices only.3. Vast Un-Banked population - According to the World Bank's Global Financial Inclusion Database, about 190 million adults in India do not have a Bank account, making India the world's second largest nation in terms of Un-Banked population after China. Low Financial literacy amongst the Indian market is another key challenge for the FinTech's to thrive.4. Lack of trust in Digital Payments - People don't feel safe using the digital payments services, as they don't trust the Internet and the perceived security risks. Since there's Big Data involved in the FinTech sector, there's a lot of risk of data theft, frauds and other security issues.5. Cash is still King in India's Hinterlands - Although the pandemic has resulted in an upsurge of digital payments adoption in urban India, rural India tells a contrasting story. According to a study by the Internet and Mobile Association of India, a mere 16% of rural users access the internet for digital transactions as compared to nearly 45% of urban users. Lack of Digital Infrastructure is one of the key reasons for people in rural areas opting for cash payments. HOW INDIAN FINTECHS CAN MANAGE THE COMPETITION IN TERMS OF TECHNOLOGY AND TALENTBy Raj N, Serial Entrepreneur, Angel Investor and Founder of ZaggleVANTAGE POINTRaj N, Serial Entrepreneur, Angel Investor and Founder
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