Investments in India’s financial technology firms continued to grow in the first six months of 2020 even as the Covid-19 pandemic sent economic activity tumbling. Fintech investments till June 2020 more than doubled over the same period last year to $1,700 million, according to KPMG’s bi-annual Pulse of Fintech report.
While fintech investment is down on a quarterly basis, the 134% year-on-year rise suggests that India will remain a major opportunity for investors in the long term, the report said.
“Covid-19 has in fact fast-tracked the digital economy and significant investments are being made by established banks and insurance companies, which can also lead to acquisition and more investments from investors,” said Sanjay Doshi, head of Financial Services Advisory at KPMG India.
Economic disparities due to the lockdown have widened due to the loss of jobs, incomes, and livelihoods. It feels like the most ideal time for fintech startups to grow and expand; catering to all sections of the society.
“The disruption caused by the pandemic allowed businesses the bandwidth to step back and reconsider their payment protocols for the inclusion of digital from a streamlining and ease perspective,” KPMG said.
“Also, individuals were inclined to consider digital payments in lieu of prevention to physical access to their funds,” it said.
It wasn’t all roses for fintech investment globally. KPMG said deal activity came to a grinding halt and most of the completed deals were actually pending ones from 2019.
When it comes to issues such as the global economy, during the pandemic, it is a mixed bag for everybody. From consumers to buyers, from investors to entrepreneurs. It is a pill hard to swallow for everybody (a little easier for fintech in India).