Payment firms continued to attract the most money in 2021. At $2.7 billion, they cornered 39% of the total VC funding into the Indian fintech industry this year.
The continued dominance of payment firms is not surprising. Annualised payments across the country are at over $2 trillion, according to a Jefferies India Fintech report released this month. While cash continues to be widely used, its share of transactions dropped from 98% in 2015 to 89% in 2020, estimated Jefferies.
“The consumer side payments story is obvious now — PhonePe, GPay, and Paytm dominate it. The next boom is expected on technology that can innovate and open up more use cases,” said Amit Nawka, executive director, deals, PwC India. Companies like Razorpay, a payment gateway company, and Zeta, a card infrastructure provider, are among those who have raised funds this year.
“The primary goal isn’t just payment processing but to offer a wide range of services like loans, enabling e-commerce, and even banking,” said Abhishant Pant, founder of The Fintech Meetup. As such, companies like Khatabook, who can integrate financial services with simple bookkeeping, and BharatPe, which is focused on merchant payments have seen interest.
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