Establishment of OCEN will democratize the lending ecosystem and promote innovation
India’s embedded finance industry is expected to grow steadily at a CAGR of 30.4% during 2022-29. The embedded finance revenues in the country will increase from US$4,801.8 million in 2022 to reach US$21,127.5 million by 2029, according to a report by ResearchAndMarkets on 9 Mar 2022.
For 2022, it is expected to grow by 46% on annual basis to reach US$4,801.8 million, said the report “India Embedded Finance Business and Investment Opportunities Databook – 50+ KPIs on Embedded Lending, Insurance, Payment, and Wealth Segments – Q1 2022 Update”.
More insurtech firms ar expected to raise capital over the next four to eight quarters to expand their portfolio and market share in India, said the report
In recent years, the embedded insurance concept has gained significant popularity in the Indian insurance market. The publisher expects embedded insurance to be a game-changer for the Indian insurance industry over the forecast period.
Embedded insurance has emerged as a promising distribution innovation for insurers over the last few quarters. Firms such as Ola, MakeMyTrip and Amazon have contextual insurance products within their core purchase journeys.
India has experienced a massive demand for embedded insurance services in the travel industry in recent quarters. Mobility firms such as Ola and IRCTC are just some of the names offering embedded insurance products for travelers in the country.
Increasing government support and product innovation in the Indian insurance industry is expected to propel market growth from a short to medium term perspective. To further accelerate their growth and reach more customers in India’s Tier II and III cities, insurtech firms are raising funds.
In September 2020, Acko, the Indian insurtech startup, raised US$60 million in its Series D financing round, therefore, bringing the firm’s fundraising to US$200 million to date.
Moreover, the digital lending sector is undergoing a massive transformation due to increased digitization, accelerated by the global pandemic. The Indian Fintech industry has evolved into a hotspot for global innovation. The growing adoption of advanced technologies has been witnessed in the Indian lending sector.
Additionally, the establishment of the Open Credit Enablement Network (OCEN) will democratize the lending ecosystem and also promote innovations of credit products in the country.
Over the last few quarters, Fintech firms have garnered massive popularity among customers in the country. To further accelerate their growth, the Fintech firms are introducing new technologies and enhanced product features to improve clients’ experience.
In September 2021, India-based Fintech player FinBox launched Account Aggregator (AA). FinBox would be able to access and onboard approximately one million new applicants more accurately, resulting in improved operations.
Traditional banks and new-age Fintechs are collaborating to innovate cost-effective lending technologies and take advantage of Fintech’s niche expertise in the lending market.
India-based finance and investments company IIFL partnered with FinBox, an Indian Fintech. Through this partnership, IIFL will offer digital credit avenues to its merchants, B2B e-commerce traders, using FinBox’s embedded buy now, pay later (BNPL) and working capital credit products.
The publisher anticipates an increased number of partnerships and product development to fuel the growth of the Indian embedded lending market over the next four to eight quarters.
In India, the embedded payment sector is undergoing a massive transformation due to explosive growth in digitization, primarily accelerated by the global pandemic. The Indian payment industry has evolved into a hotspot for global innovation. The growing adoption of advanced technologies has been witnessed in the Indian lending sector.
Companies in the embedded payments market ecosystem are raising funds to ensure the continuous evolution of their product offerings. The additional product features will allow the market players to achieve a competitive edge.
In December 2021, Indian Fintech firm Rupifi raised venture debt from Trifecta Capital. Rupifi plans to utilize the funds to expand the company’s existing B2B credit and payment offerings for small businesses operating in B2B marketplaces, according to the report. fiinews.com
