The Association of Chartered Certified Accountants (ACCA) has released a report highlighting the significant role of financial technology, or fintech, in driving India's long-term economic progress. The study reveals that an impressive 78 per cent of Indian fintech users are confident that fintech will play a crucial role in enhancing the nation's economy over the medium to long term.
With an adoption rate of 87 per cent, India ranks as the third-largest and fastest-growing fintech market globally, surpassing the global average of 64 per cent. The report, titled "Fintech as a Catalyst for Growth: Lessons from India," investigates the current and future applications of fintech across various sectors, including education, energy, and financial services.
It is based on a survey of nearly 400 participants and in-depth interviews with over 20 fintech providers, users, financial professionals, and policy influencers. The findings indicate a widespread belief that fintech will improve financial inclusion, broaden the banking base, and democratise access to alternative investments.
Sajid Khan, Director of ACCA India, stated, "By addressing inefficiencies in the traditional financial system, fintech has enhanced productivity, boosting economic growth. India’s fintech has set an example globally, providing zero transaction costs and high-speed transactions, both essential for emerging economies." This perspective is echoed by fintech expert Navin Surya, who noted, "India is now moving beyond financial inclusion, one of the key benefits of fintech, to financial expansion. By improving the velocity of money through the use of technology in financial services, fintech is positively impacting all economic indicators."
The report underscores that user confidence in fintech is rising, fuelled by robust digital public infrastructure, increasing internet access, and a favourable demographic profile. A remarkable 95 per cent of respondents reported frequent usage of fintech platforms. However, the report also points out challenges, as 60 per cent of participants expressed concerns about privacy and data security, while over half highlighted the need for stronger regulatory frameworks.
Experts envision a future where fintech evolves into a 'finternet'—an interconnected financial ecosystem that resembles the structure of the internet. This vision emphasises the collective responsibility of fintech providers, finance professionals, and regulators to seize opportunities while managing risks. The report advocates for a principles-based approach to regulation, stressing the importance of ethical practices and self-regulation among all stakeholders. As fintech continues to advance, achieving a balance between innovation and consumer protection will be essential for unlocking its full potential in fostering economic growth.
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