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19 Nov 2024
India's fintech sector is projected to host 150 unicorns with a combined valuation of $500 billion by 2030, according to a report released by JM Financial and Beams Fintech Fund on Tuesday. The growth will be driven by increasing consumption and the adoption of AI, with fintech revenues expected to surge to $260 billion by 2030, up from $20 billion in 2023.
Currently, India ranks fourth globally with 26 fintech unicorns valued at $1 billion or more. The US leads with 170 fintech unicorns, followed by China with 38 and the UK with 37. India also ranks third in terms of the number of registered fintech startups, with 10,200 companies compared to around 3,600 in China, approximately 31,500 in the US, and about 12,500 in the UK.
The report forecasts significant growth across various fintech segments over the next five to six years. Lending is expected to see a 6.6x increase in book size, from $45 billion to $300 billion. The insurance sector's gross written premium (GWP) is predicted to quadruple, rising from $4 billion to $15 billion. The wealthtech sector's assets under management (AUM) are also projected to grow fourfold, from $35 billion to $237 billion.
In the payments industry, transaction values are anticipated to reach $11 trillion by FY30, up from an estimated $4 trillion in FY25. This growth includes transactions through UPI, credit cards, debit cards, prepaid instruments, and toll payments.
Sagar Agarvwal, Co-founder and Managing Partner at Beams Fintech Fund, highlighted that increased dialogue between regulators and fintech companies, along with the involvement of experienced bankers in fintech, is contributing to the sector's stability and strategic development. Agarvwal emphasized that as banks collaborate more with fintechs and as fintechs obtain necessary licenses, the industry is strengthening its compliance. Key fintech areas such as payments, lending, insurance, wealth management, neo banks, and financial infrastructure are all set to benefit from the country's ongoing digitization and financialization trends.
From 2014 to 2023, Indian fintech startups have collectively raised over $28 billion through 1,486 deals, with $4.3 billion raised via IPOs. Notable fintech IPOs include Paytm, AngelOne, Tracxn, CMS, and Policybazaar. Agarvwal noted that the sector has matured significantly over the past 15 years and anticipates over 65 companies going public in the next seven years, positioning India as a major global fintech market.
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