Fintech startups in India: India has 3,085 startups registered with the Department for Promotion of Industry and Internal Trade (DPIIT) in the fintech sector, Rao Inderjeet Singh, Minister of State in the Corporate Affairs ministry informed Lok Sabha in a written reply to a question. The minister noted that under the Startup India initiative by DPIIT, India has 98,119 startups across 56 diversified sectors as of April 30, 2023.
In the written reply, MoS Rao Inderjeet Singh shared various initiatives taken up by the government to promote startups across multiple sectors, including the fintech startups. To attract investments in the fintech sector, the government notified the International Financial Services Center Authority (IFSCA) to launch a “Fin-tech Entity Framework” focusing on fintechs and techfins.
Moreover, the Jan Dhan- Aadhar- Mobile (JAM trinity), or the Jan Dhan bank accounts, along with the easy and vast access to the internet connection and the linkage through Aadhar helped in fintech access to a wide customer base and to provide a range of financial services, both benefitting the business and the customers, he added.
Also read: Gurugram-based fintech startup Onestack raises $2 million in Pre-Series A funding
Funding in fintech startups dropped by a massive 67 per cent to $1.4 billion in the first half (H1) of 2023 from $4.3 billion raised in H1 2022, said market intelligence platform Tracxn in its FinTech – India Semi Annual Funding Report – H1 2023. The decline in funding, according to the report, was largely due to the downward trend in early-stage investments, which plunged 81 per cent and 68 per cent from H1 2022 and H2 2022, respectively.
Seed-stage funding in H1 2023 also recorded a dip of 38 per cent and 70 per cent from H2 2022 and H1 2022, respectively. On the other hand, late funding in the first half of 2023 grew 66 per cent from H2 2022 but dropped 62 per cent from the same period last year, as per the report from Tracxn.