Insights from the FinTech Mixer - A Blueprint for India's Financial Services & Digital Future
In just over a decade, India has transitioned from a largely cash-dependent economy to one of the world’s most dynamic FinTech ecosystems, with over 2,100 FinTech companies now operational, driving innovation across payments, lending, wealth management, and insurance. A decade ago, FinTech in India was nascent, with only a fraction of today's digital transaction volume. Fast forward to today - India is the largest digital payments market globally, closing 2023 with an astounding 160 billion transactions.
The confluence of widespread smartphone adoption, affordable internet, and forward-thinking government initiatives like the Digital India campaign has laid the groundwork for a FinTech explosion. However, with rapid growth comes a unique set of challenges—regulatory hurdles, cybersecurity threats, and the need for sustainable scaling.
Against this backdrop, the FinTech Mixer hosted by 3one4 Capital in collaboration with Citi sought to address these issues precisely. Held on the sidelines of the Global Fintech Fest (GFF) in Mumbai, the event brought together 125+ of the brightest minds in Indian fintech—founders, investors, and representatives from major financial institutions and regulatory bodies—who are at the forefront of shaping the future of financial services.
The evening began with opening remarks from Nruthya Madappa (Partner), followed by a session moderated by Jatin Mamtani, Global Head of Strategic Investments at Citi. The panel featured Pravin Jadhav (Co-founder & CEO of Dhan) who discussed Dhan’s rapid growth to ₹1,000 crores in revenue within 36 months. D Venkatesh (CEO of Lentra) highlighted their innovation in digital lending, processing over 100,000 loan applications daily with zero human intervention. Gaurish Korgaonkar (Head of Fintech Solutions, NPCI International Private Limited) shared insights on UPI’s evolution and upcoming features like UPI Circle and context-based payments to further enhance digital payments in India.
Below is a recap of the noteworthy highlights and takeaways from the conversations we had:
Key Learnings from the FinTech Mixer
1. Scaling Digital Payments and UPI’s Evolution
Gaurish spoke on the transformative impact of UPI (Unified Payments Interface), which has grown to become the world’s largest digital payments platform, processing over 160 billion transactions in 2023. The introduction of UPI Circle and context-based payments will further enhance the user experience by enabling more seamless, trust-based transactions. These innovations are expected to add billions of new transactions, driving the next phase of India’s digital payments revolution.
Gaurish also emphasised the importance of financial inclusion, noting that NPCI’s innovations are not just improving transaction efficiency but also expanding access to financial services for millions of previously underserved Indians. Another critical aspect of India's FinTech success is the strong yet cautious regulatory framework provided by the Reserve Bank of India (RBI). The RBI's approach may be slow, but it ensures that the ecosystem grows sustainably and safely. The introduction of guidelines requiring banks to report to credit bureaus every 15 days instead of 30 is a testament to the RBI's proactive stance in curbing fraud and improving credit assessment.
2. The Balancing Act: Growth vs. Profitability
Another key discussion point was the delicate balance between growth and profitability—a challenge that has become more pronounced in the current economic climate. The funding landscape has shifted dramatically since the heady days of 2021, when capital was abundant and startups were encouraged to grow at all costs. Today, with investors more cautious, the focus has shifted towards sustainable growth and operational efficiency.
Pravin Jadhav shared an anecdote about Dhan’s journey through the 2021 funding boom. Unlike many of his peers who aggressively expanded, his company chose to prioritise product-market fit and operational efficiency. This approach not only ensured profitability but also positioned them to weather economic downturns. His story resonated with many in the audience, serving as a reminder that in the FinTech space, smart growth often trumps fast growth.
Dhan’s success story, which saw the company generate ₹1,000 crores in revenue within just 36 months, stemmed from its ability to build a proprietary trading system that significantly outperforms industry standards.
3. Innovation at the Core: Solving Real Problems
The panel also reinforced the idea that the most successful FinTech innovations are those that solve real, pressing problems for consumers. Whether it’s improving financial inclusion, enhancing customer experience, or reducing fraud, meaningful innovation comes from a deep understanding of customer needs.
D Venkatesh, CEO of Lentra, shared how his company tackled the challenges of digital lending by developing a credit decisioning engine driven entirely by data and statistics. This engine, which processes over 100,000 loan applications daily with zero human intervention, has not only reduced fraud but also lowered customer acquisition costs by over 100x. His story illustrated how a focus on solving the hardest problems first can give FinTech companies a significant competitive edge.
The Road Ahead: What the Future Holds
As the FinTech Mixer drew to a close, the discussions naturally turned to the future. The consensus was that the next wave of FinTech innovation in India would be driven by three key factors:
- Deeper financial inclusion
- Enhanced collaboration between startups and traditional financial institutions
- Continued evolution of regulatory frameworks
With over 190 million unbanked adults in India, the opportunity for FinTech companies to drive financial inclusion is immense. Initiatives like the Unified Lending Interface (ULI), which aims to democratise access to credit, are expected to play a crucial role in this regard. Similarly, as Indian FinTechs begin to explore international markets, cross-border payments and global collaboration will become increasingly important.
The role of traditional banks in this ecosystem cannot be understated. As the panelists noted, while banks may be perceived as slow to innovate, they possess deep financial expertise and regulatory knowledge that can complement the agility of FinTech startups. The challenge—and opportunity—lies in finding the right balance between the two.
The next decade is set to be a transformative period for India. While other regions face various internal constraints, India stands out as a fertile ground for innovation and expansion. India’s expanding internet infrastructure, growing middle class, and rising demand for financial inclusion provide fintech companies with vast opportunities for growth, scalability, and monetisation.
The FinTech Mixer was a microcosm of the challenges and opportunities that define India’s FinTech ecosystem today. As India continues to lead the way in digital financial services, the need for a collective approach to innovation, regulation, and customer-centricity is more critical than ever.
We were inspired by the overwhelming enthusiasm from the community despite the Mumbai monsoon and BKC's notorious traffic, eager to engage with India’s fintech journey and the vast potential it holds for creating purpose-driven, high-impact ventures.
