Blockchain Technology In The Indian Fintech Industry- How Will The Technology Venture The 2020s?

Did you know that the global market for blockchain technology will be worth $67.4 billion by 2026? The biggest market value distribution for blockchains is found in the banking industry. India is presently seeing the introduction of this technology.

India has developed into a significant global fintech industry hotspot and has given fintech start-ups considerable space. Covid-19 sped up the fintech sector’s expansion, which is now experiencing record investments and an explosive increase in the use of its services. It was essential for the financial industry to transition to app-based operations as sectors shifted to digital platforms.

The fintech industry has gone a long way with encrypted logins, full access to financial data, and practically all functions available at your fingertips. App-based processes do, however, need less time and effort, but it’s unlikely that they will result in secure transactions, protection against fraud, or transparency to prevent any wrongdoing. Here, blockchain technology has the potential to improve and even completely transform the entire tech-based financial industry.

Understanding Blockchain Technology

A blockchain is a decentralized, open, and distributed digital ledger that keeps track of transactions across numerous computers in such a way that any changes to the record would impact all following blocks and the network consensus. Increasing and leaving its mark in every industry, including fintech, real estate, agriculture, and healthcare, this mushrooming technology is expanding.

Boosting The Booming Fintech

It is clear that with blockchain technology, conventional financial processes may be completely transparent and based on fast, secure transactions. The new fintech transactions can create peer-to-peer networks, quick transactions, and total transparency without needing an intermediary.

Blockchain focuses on lowering the risk for financial institutions and offering secure, encrypted data that are safe and unmodified, potentially making the financial industry more transparent, less vulnerable to fraud, and less expensive for consumers. This enables the industry to concentrate on artificial intelligence- and machine-driven intelligence-based decision-making.

Financial Management Without Banks

Digital wallets, digital payments, and digital lending have all established new market segments due to the expanding new-age client sector. Blockchain technology can effectively govern this ecosystem. Blockchain-integrated digital wallets are protected by private keys while possessing their unique public address, allowing them to send and receive payments. With blockchain technology, wallet holders with private keys are the sole owners of the assets, unlike traditional currency, where banks take responsibility for holding money.

The Relevance Of Digital KYC

Trust and identification have always been difficult to establish in a financial transaction. Blockchain technology will be essential to automate the manual, paper-based, time-consuming, and expensive process of maintaining clients’ up-to-date records through digital KYC. igitization has enormous potential to keep data correct and foster genuine trust among parties conducting online business. Customer consent, data theft, and identity theft are essential parts that facilitate the task for all parties.

Borderless Payments With Blockchain Technology

Financial institutions can concentrate more on improving the speed and effectiveness of payment choices as the industry shifts toward borderless transactions. In addition, regulating the resources required to authorize payments and making them convenient for international payments further lowers the total cost of ownership.

Blockchain technology will revolutionize the fintech industry. Blockchain technology has excelled in the modernization of traditional financial institutions that fintech has risen to do. In addition, the data privacy advantage of blockchain has been building up the much-needed trust between users and providers in the fintech industry.

With an increasing focus on payments, closely followed by securities and trade finance, blockchain will focus on evolving complexity and delivery timeframe, improving financial institutions’ operational efficiency.

About Signzy

Signzy is a market-leading platform redefining the speed, accuracy, and experience of how financial institutions are onboarding customers and businesses – using the digital medium. The company’s award-winning no-code GO platform delivers seamless, end-to-end, and multi-channel onboarding journeys while offering customizable workflows. In addition, it gives these players access to an aggregated marketplace of 240+ bespoke APIs that can be easily added to any workflow with simple widgets.

Signzy is enabling ten million+ end customer and business onboarding every month at a success rate of 99% while reducing the speed to market from 6 months to 3-4 weeks. It works with over 240+ FIs globally, including the 4 largest banks in India, a Top 3 acquiring Bank in the US, and has a robust global partnership with Mastercard and Microsoft. The company’s product team is based out of Bengaluru and has a strong presence in Mumbai, New York, and Dubai.

Visit www.signzy.com for more information about us.

You can reach out to our team at reachout@signzy.com.

Written By:

Mahesh Mohan

Mahesh is a Creative Writer intent on learning and sharing knowledge. He ensures to deliver well-researched and precise information to the reader without squandering their time or tag. He is well versed in financial technology and digital marketing with a passion for stories in all forms.

 

 

Top 10 Fintech Company Business Models Set To Take Over The Fintech Industry

Did you know that as of 2022, the fintech industry is worth $179 billion with approximately 30,000 financial technology startups? Those are big numbers for an industry as young as the fintech industry. Moreover, now a usual fintech company primarily is capitalizing on the numerous services traditional banks provide, such as account opening and insurance underwriting, and turning the old business models in financial companies on their heads.

The fintech sector is receiving a tonne of venture capital funding, and “challenger” banks are threatening to eliminate banking behemoths more quickly than Netflix eliminated Blockbuster from the game. So let’s examine ten cutting-edge fintech company concepts paving the way for disruption and growth.

Progress In P2P lending

Peer-to-peer (P2P) lending is the practice of a person borrowing money from another person. Like this, peer-to-business (P2B) lending occurs when a company borrows money from a single or group of people. By directing their funds to pre-approved and carefully screened borrowers, these lending models make it simpler for investors to obtain higher returns than those provided by debt markets. Companies in the fintech industry build platforms to connect borrowers and lenders and typically deduct a charge from the borrower’s repayment.

The Magic Of Digital Wallets

We can compare a no-frills bank account and a payment gateway to digital wallets. This business model allows customers to pre-load a set amount of virtual currency into their wallets, which they can then use to make online or offline purchases from businesses that accept digital wallets.

Providing users with the convenience of making payments for a small fee that is typically charged to businesses is the basic tenet of a digital wallet business model. These can be in the form of a merchant discount rate (MDR) and through the float that they would make on the money that is sitting unpaid in customer/business accounts. Businesses that provide their customers tangible goods or services in person are the typical end users of wallets, for example, Venmo, Square Cash, Google Pay, etc.

Digital Banking Revolution- The Fintech Company Impact

Imagine your local bank closing its physical location and moving entirely online. There would be no bank tellers, no mail, and no real offices. Instead, challenger banks provide no-frills personal and commercial bank accounts through a fully developed digital infrastructure. The business strategy used here is much the same as that of a bank with physical branches, except that consumers can significantly benefit from lower rates thanks to the significant labor and real estate cost savings.

Safety For Everyone, Everywhere With Digital Insurance

A standard fintech company in the insurance sector brings all of the conventional services online, just like digital banks. These Fintech companies can offer life and health insurance with superior underwriting procedures while aggressively undercutting traditional insurance providers because they can charge variable premiums based on the customer. These insurance policies can open up commercial opportunities that insurance firms have just begun investigating when combined with targeted marketing.

Access Transaction delivery

The ability to effectively manage data can provide invaluable insights into the demands and desires of the client. Data is the new oil. To gather customer data and then share it with the rest of the group to map the customer’s capacity to pay premiums, invest in real estate, buy mutual funds, etc., financial technology entrepreneurs in the transaction delivery space are developing free solutions, including cost management apps. A standard fintech company operates under a commission-based business model by reselling financial products from third parties.

Even A Single Fintech Company Ensures Safer Payments With Gateways

Payment gateways allow customers to pay for goods and services on a retailer’s website. Various payment options are available today, including cryptocurrencies, digital wallets, debit cards, and credit cards. Unfortunately, banks typically impose astronomical fees for processing transactions from these numerous channels. Still, fintech companies are combining these payment channels into practical apps that internet retailers can easily afford and incorporate on their websites. Businesses offering tangible goods or services to end customers are the typical users of these payment apps, such as Stripe, Alipay, and iZettle.

Easy Asset Management

Have you ever heard of buying mutual funds or stocks without paying a commission fee? In exchange for their data, fintech businesses are allowing investors to trade for free. They deliver this information to high-frequency traders, who can then affect the asset’s price. The investor may pay a little higher price for their asset, but there is still a positive differential between what they save on trading fees and the marginal price rise.

Small Ticket Loans Have A Big Market

Due to the poor margins and significant setup and recovery expenses associated with smaller-price loans, banks and other lenders often do not want to underwrite them. A standard fintech company in this industry segment (like Affirm) offer one-click buy buttons and impulse buy mechanisms on e-commerce websites to let clients make quick purchases without submitting any authentication or credit card information.

We can buy almost anything outright with the opportunity to pay in installments. This is thanks to the average 0% interest rate at which these loans are underwritten. So how does one make money? By disclosing customer information to the original equipment manufacturers (OEMs), who stand to gain the most from the decreased cost of these gadgets. Highly individualized marketing offers are ensured with algorithms that ascertain customer demographics. Consider sharing your data with them as the loan’s interest.

Alternative Credit Scoring

Due to stringent and antiquated credit score standards, many self-employed people with a reliable source of income fail traditional bank loan screens. By taking into account alternative data points like social signals and percentile scores among comparable borrower groups, a standard credit rating fintech company adopts novel strategies. With time, better lending judgments may result from combining all these qualitative factors with an intelligent and self-learning algorithm. For instance, a lender can avoid dealing with loan recovery if there is a means to identify unfavorable profiles based on social presence before loan disbursement.

Alternative insurance underwriting

Two people today who are the same height and weight, don’t smoke, and don’t consume alcohol will receive the same life insurance premium. But one individual can be a fitness fanatic, while the other might be a couch potato who is more likely to get diabetes and pass away from it. Since risk premiums currently don’t account for characteristics that aren’t quantifiable, average out (also known as normalizing in actuarial terminology) leads to these incorrect premium computations.

Fintech businesses are developing variable premium computing processes utilizing alternative data points like social signals, lifestyle, and medical history, similar to alternative credit scoring. These InsureTech firms may decide whether to offer insurance, present various terms and conditions and provide numerous payment choices when combined with intelligent and self-learning algorithms (for example, co-pay options).

The Bottomline

Fintech firms have a considerable role to play in the futures of almost all industries. They are revolutionizing both precedent and retrospect. As the world evolves, fintech innovates.

About Signzy

Signzy is a market-leading platform redefining the speed, accuracy, and experience of how financial institutions are onboarding customers and businesses – using the digital medium. The company’s award-winning no-code GO platform delivers seamless, end-to-end, and multi-channel onboarding journeys while offering customizable workflows. In addition, it gives these players access to an aggregated marketplace of 240+ bespoke APIs that can be easily added to any workflow with simple widgets.

Signzy is enabling ten million+ end customer and business onboarding every month at a success rate of 99% while reducing the speed to market from 6 months to 3-4 weeks. It works with over 240+ FIs globally, including the 4 largest banks in India, a Top 3 acquiring Bank in the US, and has a robust global partnership with Mastercard and Microsoft. The company’s product team is based out of Bengaluru and has a strong presence in Mumbai, New York, and Dubai.

Visit www.signzy.com for more information about us.

You can reach out to our team at reachout@signzy.com.

Written By:

Shraddha Agrawal

Shraddha is the Director of Marketing at Signzy. She is an adept, goal-driven professional with 11+ years of experience. With an unwavering innovative spirit and a profound commitment to organizational growth, she is determined to enhance all her endeavors. She keeps herself updated with the latest digital marketing trends to stay ahead of the curve.