India’s Leading BFSI and FinTech Companies 2022

29 While the FinTech is reshaping the BFSI sector through various disruptive services offered to the sector, the other wide range of areas in the FinTech landscape that the BFSI sector would be looking at are: Strengthening consumer facing solutions: BFSIs companies are looking to strengthen their consumer facing solutions. Risk evaluation: FinTech can use big data and analytics to forecast client behaviour and generate sophisticated risk evaluation. This can help in making better judgments and provide more personalized consumer experiences. Also, with the help of big data analytics, FinTech may integrate data from a variety of sources for improved risk assessment. Fraud detection: Big data analytics can be used to develop accurate fraud detection systems by detecting any odd transactions. Robotic Process Automation (RPA): RPA in BFSI can allow bots to undertake repetitive and labor-intensive tasks without the need for human interaction. While the BFSI sector undertake digital transformation for substantial efficiency gains and better customer experience, it will also have to deal with digital frauds, compromise of customer credentials, data privacy and safety issues. Here again innovation in FinTech space can help in mitigating these impending concerns. Concluding Remarks The COVID-19 crisis posed significant operational, financial and human capital risks to the Indian BFSI sector. However, the sector has surprisingly shown great resilience in this challenging period. In case of Banks and NBFCs, the headline risk was related to the rise in NPAs due to higher default on loan repayment especially by COVID-hit sectors. Although the timely policy measures mitigated this risk to a certain extent, it may reappear once the policy measures are withdrawn. This risk scenario can get further intensified if the domestic economy fails to gain further momentum given the impending global economic uncertainty. Indian banks though have insignificant direct exposure to the conflicting countries, may witness some rise in delinquencies on export credit to businesses with higher trade links to Russia and Ukraine. The current geopolitical risks, rising global and domestic inflationary pressures and potential hike in the policy rates would keep securities market and mutual funds under pressure in the near term. In case of insurance segment investment in digital technology will play a crucial role in the future growth of the industry. The early adoption of digital ways of operations like remote underwriting, digital interaction with customers, contactless processing, video-on-boarding will providemuch required boost to the insurance sector. The Indian BFSI sector will continue to witness growth of digital payments system in the coming years. Emerging digital technologies, foreign investment in payments FinTechs and supportive policy ecosystem will fuel growth of digital payments in India. Taking cues from the pandemic let disruption, BFSI sector will be required to invest in business continuity plans and prudent risk management strategies. In this regard, digital transformation of BFSI companies and collaboration with FinTech can further boost the growth of BFSI sector. With the theme of BFSI sector fast shifting towards consumer experience, FinTech is set to play a vital role. This is also aided by the right regulatory and policy environment that will enable smooth transition of BFSI companies on digital path. The RBI has already created an enabling framework for Regulatory Sandbox as well as set up Reserve Bank Innovation Hub to promote innovation in financial services. Thus, it is the right time for the BFSIs to take their partnership with FinTech to the next level. Dun & Bradstreet