CNBCTV-18 And IIM-K’s India@2047 Leadership Series: Challenges and Opportunities in the Fintech and Healthcare Sector

When it comes to financial transactions in India, there is clearly a pre-Covid ecosystem and what came after. Almost overnight, we were all converted to active users, regardless of whether we were skeptics, agnostics or enthusiastic evangelists of the security and convenience of online payments.
While many other economies fluctuated similarly, India has emerged as a clear forerunner when it comes to digital payments. From QR codes on every storefront, to a record 7 billion transactions last month on the UPI platform, to exporting our homegrown Unified Payments Infrastructure to Singapore, Europe and beyond. India is clearly on its way to becoming the global hub for financial services innovation.
This innovation comes with certain costs – according to a recent report by the Boston Consulting Group, Indian banks and financial institutions will be required to spend $5 billion each year to meet the demands of a digital economy that is seeing increasing adoption by a population of 1.5 billion people. These expenses are more than offset by the benefits a digital economy brings: from closing credit gaps to underserved segments, to increasing incomes for the poorest sections, to increased penetration of insurance, to financialization of household savings.
The question remains: will fintech achieve its potential?
As India rushes towards the centenary of independence, it is time to both reflect on the milestones of the past and chart a road map for an ambitious future. As the GoI reads its plans, CNBCTV-18, in collaboration with the Indian Institute of Management, Kozhikode (IIM-K), has launched India@2047, Leaders Without Borders: a 5-part leadership series that engages in meaningful dialogue on the key drivers of our social and economic growth. In this series, CNBC-TV18’s Managing Editor Shireen Bhan and Director, IIM-K Debashis Chatterjee talk to corpora from various fields to capture India’s aspirations, and to draft a charter for change that will help shape the idea of ​​India@ 2047.

The Promise of Fintech
There is some debate about the size of the fintech opportunity, particularly when it comes to household income financing. According to Nitin Kamath of Zerodha, who bases his calculations on the number of people filing tax returns, he believes the opportunity to drive investments in the capital markets peaks at 15 million investors. He believes that the challenge lies in creating a consistently positive experience for retail investors – every boom cycle brings investors in in droves, but most are driven away by poor results and bad experiences. According to Nitin, financial advisory is the key to unlocking investor confidence, and thus a greater number of investors.

Saurabh Mukherjee of Marcellus takes a different tack. He estimates Indian household wealth to be somewhere in the neighborhood of $10 trillion, with most of it invested in physical asset classes such as real estate and gold. Unfortunately, these asset classes consistently underperform compared to other financial asset classes. However, we are starting to see the movement from physical assets to financial assets at a rate of around $100-150 billion per year. Saurabh believes that as financial products become more accessible through lower costs and greater transparency, this will unlock the full potential of India’s household wealth and in doing so, empower the credit ecosystem to deliver greater penetration to underserved segments such as MSMEs.
According to Professor Debashis Chatterjee of IIM-K, an environment of trust and reliability has always been key to unlocking adoption, and the first step towards creating this environment is imparting financial literacy. “Digital literacy awareness is important to flourish in a digital economy and to protect against cybercrime and digital theft. The question is mindset or illiteracy, and also one of risk of appetite. When you are not sure about a medium or investment method you tend to fall back on asset classes you understand, like gold.” Professor Chatterjee also draws attention to the progress made possible by technology – bank account access has grown from just 10% of the population in 2008 to more than 80% today. “Technology has achieved in a decade what might otherwise have taken half a century.”
Technology as an enabler in healthcare
While Fintech adoption has its hills to climb, India’s healthcare industry has seen a transformation that was unimaginable just three years ago. Already known as the world’s pharmacy, India exports more than $20 billion worth of affordable medicines annually, meeting nearly 60% of global demand for vaccines. In India, the pandemic led to an urgent need to reinvent outdated healthcare delivery models and has laid the foundation for digital transformation.
The national digital health stack data is encouraging, with 400 million smartphone-friendly Indians having used a digital health service at least once. That is the demand side. On the supply side, more than 7,000 Healthtech startups are driving down the costs of India’s broken healthcare system. This is a promising start. India’s medical tourism industry ranks 10th on the Medical Tourism Index (MTI) for 2020-21 due to a combination of high quality and low cost. However, for the bulk of India’s population, quality healthcare is just slightly out of reach.
India’s health needs are inherently challenging. Despite the country being largely rural, the proportion of primary health care centers with doctors has only marginally increased from 17.5% in 2005 to 21.8% in 2021. Although private health services aim to close the gap, over 100 million Indians slip each years into poverty due to own health expenses.
Biocon founder Kiran Mazumdar Shaw is very excited about the Ayushman Bharat mission, and believes that digital technologies have the potential to leapfrog the struggling Indian healthcare system by driving greater efficiency and resource optimization. Sunita Reddy of Apollo Hospitals agrees – Apollo Hospitals used digital training during the worst of the Covid pandemic to train their nurses to handle ICUs and ventilators. Thus, they greatly expand their capacity to treat and handle Covid patients.
She believes that a combination of technology and finding the right model for private and public health centers is the key to building out primary health care in a way that is affordable, efficient and accessible to a larger percentage of India’s population. Kiran also acknowledges that the poor outcomes we see are often due to a delay in diagnosis and its negative effects on treatment costs, which can make adherence to the treatment plan unsustainable for poorer families.
This is where she sees an opportunity for telehealth services, especially in remote rural areas where full-fledged primary health care centers cannot be made viable. However, the question of scale remains unanswered. Sunita also believes that investments in preventive healthcare can really pay off – for every one rupee invested in preventive medicine, six rupees are saved.
Professor Chatterjee summed up this discussion eloquently: “We must recognize that while death is not negotiable, healthy aging and the journey to the inevitable mortality that we all face should be a privilege and not just a pain for our people. That is the point. of the word ‘Ayushman’: blessed and not cursed with long life.”
He also outlined IIM-K’s 3D framework for transformative action in healthcare: Digitization driving improvement in healthcare at both scope and scale, enabling patients to thrive rather than just survive. Diversification must be at the heart of a differentiated healthcare system: misalignment among stakeholders such as citizens, regulators, pharmaceutical device manufacturers, insurers, academics, policy makers, investors all contribute significantly to the underperformance of the healthcare sector. By increasing the portability of data and services across open health exchanges, we ensure that citizens have access to such services, retain control and have fiction-free experiences.
The last D is disruption. Covid-19 broke down real and imagined barriers. “Vaccines developed at record speed, adoption of telemedicine became real, doctors started monitoring patients in home care, unprecedented community participation happened… and you could see phone-based symptomatic screening and data-driven pandemic response at different levels. The pandemic has been a disruptive trigger to rethink the health system in India from the ground up. Both the government and private players made several changes in the overall healthcare sector to ensure the preparedness and resilience of Indian healthcare. We need to think big. Incremental steps alone will not make universal healthcare a reality for 1.5 billion people. “
Fortunately for India, thinking big is what India’s vision for 2047 is all about.
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