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INTRODUCTION
Fintech is a relatively new industry that is growing at an unprecedented rate. Fintech business idea are disrupting the financial services industry by providing better, cheaper, and faster services to customers. The fintech business ideas listed below are some of the most promising in the industry. They are all either already making a significant impact or have the potential to do so in the next few years.
Nowadays, there are many innovative Fintech business idea for a startup in the financial industry. Here are some of those which have been created and developed to help people with their finances.
In this article, I will introduce you to 7 of the most promising FinTech Startups that can be started in 2023.
1. Digital Banking and Deposits Services
2. Mobile E-Wallets
3. Peer-to-Peer Lending (P2P Lending)
4. Cryptocurrencies Exchange Platforms
5. Stock Trading Platforms
6. Assets management
7. Insurance Aggregator Technology
1. Start a Digital Banking Services
A Digital Banking Service (DBU) is a financial service that helps its customers manage their bank accounts. The entire service is provided online over the internet.
It offers a 24X7 banking services to its customers. They generally also have a centrally located physical retail Banking unit for customer grievances, complaints and other customer services.
Most of the PSU Banks and Private Banks in India have moved towards Digital Banking services at par with their retail banking services as part of Banking digitalisation in India.
What are the opportunity for new Startup businesses in Digital Banking?
Digital banking is one of the fastest growing industries today. As more and more people become comfortable using digital platforms for daily transactions, there is great opportunity for new businesses to tap into this new era of digital banking by capturing these transitioning millennial customers into there Digital Banking platforms by offering them competitive services.
These New age Digital Banks are creating much streamline, appealing UX/UI and easy to use digital banking mobile apps and websites which allow customers to perform all of their banking online. They also provide digital channels to sell services and products, such as wealth management.
Many new Digital banking players are emerging who are are using digital channels in order to reach more people, accomplish more transactions, and reduce costs that come with in-person interactions.
A Digital Banking service provider company offers usually offers the following services:
- – Money deposit and transfer service
- – Web based banking and investing
- – Credit card, debit card, ATM access
- – E-shopping and Bill payments.
- – Balance Checking and Transferring
- – International money transfer. etc.
Top Digital Banks in India
- Paytm Payments Bank
- Jio Payments Bank
- Airtel Payments Bank
- Digibank BY DBS (Development Bank of Singapore)
2. Start a Mobile Wallet business in India
The Mobile Wallet business also known as Electronic wallet or Mobile E-Wallet service are companies that provide the mobile phone payment services. These companies facilitates the process of receiving and sending money over mobile devices seamlessly for both individuals and businesses.
The Mobile e-wallets service providers in India have been coming up with new innovative technologies and promotional schemes for customers and to encourage and make it easy for them to transact on their phones.
There are many benefits of the mobile e-wallet services for its users like
- Mobile wallets allows its user to pay for goods and services on the go with their smartphones digitally.
- Reducing the overall dependency on carrying cash and credit Debit cards all the time .
- Eliminating the chances of stolen, lost or misuse of Cash or Credit and debit cards.
- You can also store money, transfer funds, send and receive money across multiple platforms, and use vouchers and coupons.
- Utility payments and Bill payments instantaneously.
- Payments for Online shopping, Booking travel Tickets and Hotels.
- Making small petty Payments at Shops, Café, Markets on daily basis.
- Limited Line of Credit or overdraft facilities for regular customers.
- Loyalty programmes, Cashback guarantees, Gift vouchers, Pay later Schemes, Discounts and Vendor Tie ups etc.
With all the above features and benefits of these Mobile wallet apps it has never been easier to pay for goods and services with your phone. With these features, you can never miss to make a payment at the café or even airport terminal all without the need to carry out your wallet.
What are the opportunity for new businesses in Mobile Wallet business in India
With Digitalisation of the Indian Banking system and more customers becoming comfortable with mobile banking there is no dearth of opportunity for new Mobile wallet Business providers in India.
By launching innovative technologies like Contactless payments and newer services like Shop-n-Pay Later schemes there will always be room for emerging players in Mobile Wallet business. Businesses that will bring in more Innovation in Tech and Services for the customers will always draw customers towards them.
Top Mobile Wallets Provider company in India
The are many mobile wallet providers such as
- Paytm,
- Mobikwik,
- PhonePe,
- BharatPe,
- PayU India, etc., this is just the beginning as more new Mobile Wallet businesses are in the pipeline.
3. Start a Peer to Peer Lending Business
What is Peer to Peer Lending business?
Peer-to-peer lending or P2P lending, is the practice of borrowing money from multiple lenders through an online portal. The loan is funded by a group of people who lend to one borrower and they are repaid collectively according to the terms of the loan thus cutting out the middle men like NBFC, banks, Agencies etc.
P2P lending App is a form of crowdfunding platform, which functions by connecting borrowers and lenders together on their platform or App who need funding. The process is fully automated, allowing for simple and safe lending.
This new Fintech business idea of P2P lending has become a popular among both lenders who want higher returns on thin capitalization and borrowers who want quick and urgent money but are unable to raise money through traditional financing methods.
What are the opportunities for new Peer to Peer Lending business in India
P2P lending is expected to skyrocket in the next few years in India. As India’s economy is headed for $5 trillion the Fintech industry is expected to be around $10 Billion till 2030. And P2P Lending will have a significant share of this sector.
There is huge opportunity for Credit options and lending services in India as Indian markets soars to new heights and new P2P businesses can explore the full potential in years to come as online lending and credit will pick further pace.
There is a huge demand for P2P Lending platforms in India among both consumers as well investors as primarily for 2 reasons.
1) Since P2P lending platforms often offer higher interest rates than traditional Banks as returns are uncertain and not subject to regulatory constraints. It is very popular among lenders who wish to earn higher interest on their capitals.
2) Among, Borrowers as it easy to borrow money from P2P sites or apps due to lower scrutiny, faster disbursement and very little documentation making the entire process simple and hassle free.
With RBI regularising the P2P lending industry in 2017 it has provided this sector much needed recognition and legitimacy and thus sector is slated for huge growth in the future as India’s economy is soaring to $5 trillion mark.
The Top P2P Lending Sites in India are:
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4. Start Cryptocurrencies Exchange Platforms
What is a Cryptocurrencies Exchange Platforms
A cryptocurrency is a digital currency that can be used as an online form of payment.
Cryptocurrency exchanges, also known as digital currency exchanges (DCE), are businesses that allow customers to trade cryptocurrencies or digital currencies for other assets, such as conventional fiat money or other digital currencies.
Cryptocurrencies exchanges are a necessary part of the crypto-currency ecosystem. These services allow users to buy, sell, and trade crypto currencies with each other and with the providers of the exchange. Prices are determined by the market forces of supply and demand.
Crypto currency exchange platforms charge a commission for each transaction made. The commission can vary depending on the platform and the type of transaction but most crypto exchange charge between 0.2% to 1% depending on platform.
Since Crypto currency is a type of currency that exists only in digital form. It is not controlled by any central authority and relies on cryptography to control the creation of new units, as well as to verify transactions.
Digital currency can be used with a variety of different purposes, such as:
– To make payments without the need for cash or credit card
– To transfer money instantly
– To provide economic stability in an unstable economy
– To make international payments easier and cheaper
– To provide financial privacy
What are the opportunities for Cryptocurrencies Exchange business in India
The future of Cryptocurrencies Exchange business in India is highlighted by the fact that there are many new entrants in the market and more people are interested in investing in cryptocurrencies. .
The primary reason for this is that cryptocurrencies are gaining more traction in India and are also becoming more acceptable. The mainstream acceptance of cryptocurrencies in India which is likely to result in a boost in cryptocurrency trading and investment opportunities, is also one of the major factors.
One of the major reason for new business to enter in cryptocurrency exchange business is that people are looking for alternative investments option over traditional modes of investments that can provide them with a higher return-on-investment. The fact that several companies have recently started Cryptocurrency Exchange platforms in India testifies that there is a definite growing demand for this business.
Top 5 Cryptocurrencies Exchange platforms in India are:
5. Start a Stock Trading Platforms
What is a Stock Trading Platform Business
A stock trading platform, also known as a trading platform, is a computer-based intermediary system which facilitates the trading of securities on global stock exchanges. A stock trading platform allows its user to buy, sell and also hold securities in their depository accounts for future trade.
Stock trading platforms are the interfaces through which investors can place orders and trade stocks. The trading platforms offer a range of features, such as real-time quotes, charting tools and order execution.
Stock trading platforms typically offer a range of services and tools to help investors manage their portfolios. The trading platforms may also provide tools to help investors analyze the financial markets, such as algorithmic trading and news aggregation.
Stock trading platforms usually charge a nominal brokerage fee on percentage basis or on fixed commission basis for their services, where the traders buy or sell securities through their platform.
Most stock trading platforms offer other complex financial instruments as well such as
- Options,
- Futures,
- Bonds and
- Commodities
- Currencies
- Exchange-traded Funds (ETF) for investors to trade through their platform.
What are the opportunities for Stock Trading Platforms business in India
India with the GDP growth rate of 7.3% and the population of over 1.3 billion, has a huge opportunity in terms of its potential for economic growth and development. In addition, with growing middle class and rising income levels every year many new retail investors are emerging in India who have never traded before but are now feeling more confident about investing their money into the market.
This Fintech business idea of stock trading platforms business in India has a lot of opportunities to grow given its size and potential for growth. The Indian government has been working on easing regulations on foreign investments, which is opening up new markets for investors.
Upcoming Stock Trading Platforms with new business models offering more features, functionality, and scalability than their predecessors in the sector has a lot of scope and opportunities to enter the market briskly and capture the massive pools of retail investors which is only slated to grow in size.
Top 5 Stock Trading Platforms in India are:
6. Start an Assets Management Company
What is an Assets Management Services Business?
An Assets management or wealth management services are businesses that help people with their financial planning. The services typically include, but are not limited to, advice on investments, stocks, bonds, retirement plans and estate planning.
What is a Assets Management Platform ?
An Assets Management Platform is an online platform that helps you manage your money, set goals and reach them. It is typically a SaaS with an app that offers financial advice, selections of investments and tools for building your own portfolio.
The Assets Management platforms is a software product that is designed to help companies and individuals to facilitate the administration, investment, and reporting of a wealth management portfolio.
More then 70% of investment firms worldwide as well as many banks and financial institutions such as JP Morgan Chase & Co., Citigroup etc use on Assets management software to construct wealth management portfolios for their clients.
What are the opportunities for wealth management Platforms business in India
The Indian Assets management industry is a $37.5 billion market, with a growth rate of 7% in the last few years. The Indian wealth management industry is expected to grow at a CAGR of 8% over the next 3-5 years.
Opportunities for new wealth management platforms businesses include:
1) Creating innovative investment solutions for investors who want to invest in equity, debt, and other asset classes
2) Providing data driven accurate financial advice and portfolio management services
3) Developing new products and services such as insurance policies, credit cards, etc.
India has been a promising market for Assets management business. There is a huge population of people with wealth in India and it is the second-biggest market for wealth management firms in the world.
This Fintech business idea of Assets management business in India is looking bright. With a large population and many people moving to the cities, there is an increasing need for savings and investment related services. The industry has been growing at a steady pace over the last decade, with experts predicting that it should continue to grow as well.
- Top 5 Assets Management companies in India are:
- ICICI Prudential Asset Management Company
- HDFC Asset Management Company
- SBI Mutual Fund
- Nippon India Asset Management Company
How to Start Fintech Company|10 Point Complete Guide to be a Successful Fintech Entrepreneur
7. Start an Insurance Aggregator Platforms
Insurance aggregator businesses are growing in popularity as people are getting more aware about the benefits an insurance coverage in their lifetime. This new business model is quickly gaining traction and empowering people to secure the best insurance deal with maximum coverage on their own, in a competitive marketplace.
What is an insurance aggregator platform
An insurance aggregator platform is a software that helps insurers and brokers to communicate with each others. It provides a centralized interface that connects customers to various insurance providers in the industry.
Insurance aggregator platforms or websites eases the entire process of choosing an insurance plans for its users by comparing plans from different insurance companies at the click of your fingers . These platform may also be referred to as “insurance exchanges.”
These are Aggregator platforms make money through commission earned on sale of insurance plan over their platforms. They also generate revenue when customers renew their existing insurance plan over their sites.
What are the opportunities for new startups in Insurance aggregator businesses
The insurance industry in India is still in a nascent stage and there are opportunities for aggregator businesses to fill the void. There are around 500 million people without any form of insurance coverage which provides a huge market opportunity for new entrants. The insurance sector in India is currently around $40 Billion and its just miniscule when compared to the potential India has.
With more than 50+ Insurance companies and hundreds of insurance plan to choose from the task of choosing the right insurance plan is a tedious and complicated process, that is why a lot of consumers have recently started to move to insurance aggregator platform to take informed decisions when buying plans.
For this Fintech business idea the opportunities are immense for new start-ups who can bring in more innovations and ease the customers pain further in choosing the best plans. With so many insurance companies to watch and as many policies to choose from the role of good insurance aggregator platform are getting crucial.
Top Insurance Aggregator Platforms in India.
Conclusion
These are the 7 Fintech business ideas you can start with when looking to start your new Fintech business. The Fintech industry is not just confined to the above ideas there is scope for plenty of new business models to emerge and succeed in India due to the vastness of the India’s economy and potential to scale further to achieve newer heights in global stage.
These Fintech business ideas are just an example of how new business model have emerged and have become successful India’s competitive markets through innovation and clever strategies.
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