India tops Singapore, Indonesia in fintech studies
In a report released last week, India emerged as the top nation in a fintech study of nine South and Southeast Asian countries published by the Robocash Group.
Robocash is a fintech company with offices in Asia and Europe that specializes in providing technological financing solutions for those underserved by the traditional banking system in emerging markets.
India also emerged as the leading county in the Robocash Southeast Asia Fintech Index. The index collects points using the following measurements – share of total funding, share of total income and share of total active companies. Singapore was second and Indonesia was third.
The following four fintech sectors were selected for the survey – Payments and Transfers, Alternative Lending, E-Wallets and Digital Banking. For the purpose of the study, only those companies based on the territory of a particular country were selected, while foreign entities were excluded.
India has the largest number of such companies operating, with 541, representing 43.1 percent of the total, followed by Indonesia 165 (13.2 percent), Singapore with 162 (12.9 percent), the Philippines 125 (10 percent), Malaysia 84 (6.7 per cent), and Vietnam 78 (6.2 per cent). Pakistan, Sri Lanka and Bangladesh have the fewest fintech companies among the countries surveyed with 51, 27 and 21 companies respectively.
Therefore, it is not surprising that Alternative Lending, which includes services such as online microcredit, peer-to-peer loans and point-of-sale financing (for example, installment loans to buyers at the checkout), experienced the highest growth among the four sectors between the years 2000 to 2022 .
Robocash noted that the four sectors studied are by no means the most important fintech sectors in the region. Although they represent 54.3 percent of all fintech companies in the Philippines, the other countries in the survey have more diversified fintech sectors with these four sectors representing only 19.4 percent of all fintech companies in Indonesia and only 10.5 percent in India which the Robocash report says has 5,176 fintech firms.
India received a total of US$25.6 billion (48 percent of total funds), followed by Singapore with US$14.7 billion (27.6 percent), Indonesia US$7.5 billion (14.1 percent), the Philippines 2.4 USD billion (3.4 percent), and Vietnam USD 1.8 billion (3.4 percent).
Hemant Gala, Head of Financial Services & Banking at Indian digital payments giant, PhonePe, was quoted in 2021 as saying, “Digital payments have become a way of life in India and we have seen 10-15 million new customers coming to it digital bandwagon in the last 12 months. Two factors that led to this change were demonetisation and the Covid-19 pandemic.”
Digital lending, InsurTech and WealthTech are among the sub-sectors set to experience the strongest growth, the report says, driven by greater customization of segment-specific solutions, increasing awareness and easier policy purchase and claims processes, and growing demand for investment solutions.
Image courtesy: Robocash Group
