As India is progressing towards a USD 5 trillion economy and reshaping as a global powerhouse, technology has paved the way for automation and transformation in the financial services industry. Advancements within the FinTech space significantly foster innovation and powers financial institutions to offer digital services and retain relevance in the market.
The amalgamation of finance and technology in recent times has encompassed all kinds of technology leveraged with finance to service both – businesses and consumers. Whether it is a large organization indulging in blockchain technology or you paying a streetside snacks vendor via UPI; welcome to the world of FinTech.If one part of the economic ecosystem seemed averse to change but has embraced FinTech in a big way is the traditional banking system. This can be attributed to a dramatic shift in customer service expectations and involves a significant change towards digitization to offer more personalized, instant, superior, and secure service to customers via various digital channels. On the digitization of financial services, a lot can be attributed to the pandemic too. It has changed how you and I transact for anything. And this has led to a significant shift in perception about the fintech space as well.
The growing trust in the usage of technology in the financial world coupled with stringent COVID-19 restrictions led to the rapid adoption of technology-based financial solutions. The pandemic, therefore, prompted FinTech companies to pivot to solve unique challenges faced by customers. Now, we can firmly say that Fintech in India has well past its infancy in terms of acceptance and growth within the financial services sector and the masses.
While winning over trust is one of the factors that have been a major barrier to the adoption of FinTech among consumers in India. This makes it imperative for FinTech companies to simplify to foster transparency, eliminate confusion, and build reliability. And one such step is the Account Aggregator framework which is a game changer. The AA framework allows sharing of information digitally and securely wherein lenders get a host of data points like bill payments and investments to assess credibility. The AA framework can revolutionize financial services by simplifying data sharing thus enabling seamlessness to the whole process that eventually benefits the customer too.
Undoubtedly the finnovations that provide ease, convenience and total security for any financial transaction will lead the pack. And it calls for larger data sharing and transparency. The more the financial inclusion the more robust and reliable will be any FinTech offering. Collectively, it calls to create a system to monitor the risks and regulatory impact of financial technology development, lower regulatory barriers to investment, and give tax incentives and regulatory support to the financial technology industry.