India's fintech sector expected to reach $150 to 160bn by 2025: Report

translating to an incremental value-creation potential of approximately USD 100 billion. Further, it is estimated that to meet this ambition, India’s fintech sector will need investments of USD 20-25 billion over the next five years,” it added.

The report said India has seen a sharp rise in the number of financial technology (fintech) firms. Of the over 2,100 fintech firms existing in India currently, 67 per cent have been set up in the past five years.

The report said COVID-19 has accelerated the pace of digitization across categories. While certain fintech segments (for example, lending) may see a blip in the near term, there is a large sustainable behavior change towards digital offerings in financial services.

“We believe that India’s fintechs are at the precipice of a significant value-creation of USD 100 billion over the next five years. To actualise this potential, the industry would require additional investments to the tune of USD 20-25 billion,” BCG Managing Director and Partner Prateek Roongta said.

“The fintechs that will achieve these milestones will be the ones that ‘master the core’ by building deep, differentiative capabilities on their primary offerings. India will also see the emergence of ecosystem orchestrators and multinational fintechs, making it a global fintech powerhouse,” Roongta said.