Fintech accounts for 3 per cent India’s financial services revenue pool, to clock $70 bn revenue by FY30

India’s fintech sector, the third-largest globally, is expected to clock $70 billion in annual revenue by FY30, accounting for 18-20 per cent of the addressable financial services revenue pool in the country, as per a report from Elevation Capital. Fintech firms have captured 3 per cent or $5-7 billion of the $210-220 billion financial services revenue in India so far. 

Multiple factors have fuelled this growth, including a rapidly growing digital population, widespread digital banking adoption, robust public infrastructure, and a favourable regulatory environment. 

According to ‘The Bottomline: Elevation Fintech Report 2023’, the financial services market will be worth $610-620 billion in FY30, of which $65-75 billion will go to fintech players. 

“India is today setting the template for the rest of the world with its innovative models in fintech and financial services. Our fast-growing digital population, world-class Digital Public Infrastructure (DPI), and proactive regulators are three key tailwinds underpinning the fintech growth, which will expand into a $400 billion opportunity by 2030,” Mridul Arora, Partner, Elevation Capital, said. 

India has over 9,000 fintech companies and the investment that the sector has raised surged threefold in 2022 compared to 2018, now constituting about 14 per cent of the country's start-up funding. 

Fintech firms have captured a substantial market share across various financial service sectors, with approximately 70 per cent of digital payment transactions falling under their umbrella—marking a 2.3x increase from FY19 to FY22. Similarly, fintechs hold roughly half of the active broking accounts on NSE, marking a fourfold growth between FY19 and FY22. Insurtechs, especially in areas like motor insurance, have seen a fivefold expansion from FY19 to FY22, with fintechs capturing around 5 per cent of the gross written premium underwritten.

“They (fintechs) are creating and will continue to create value across the 4Es of Expansion, Efficiency, Experience, and Enablement. Over the next decade, we expect this value creation to accelerate, catalysed by India’s Digital Public Infra, allowing fintechs to capture 12-15 per cent of the financial services revenue pool by 2030,” said Vaas Bhaskar, Principal, Elevation Capital.