Fintech means a great many things to a great many people. In such a broad, fast-moving space, risk and uncertainty are par for the course. Fintech is a good blend of Finance and Technology. All over the world, many fintech start-ups are evolving. It’s a big industry with a good scope of growth and profit, but it is tough to survive in this fast-growing sector. There are various challenges that a fintech industry faces.

Challenges Faced by Fintech Startups in India:

Regularity bodies

Red-tapism and the immense number of laws slow down the market, but strict regulations are inevitable when it comes to a financial or technological company. Fintech faces a lot of challenges in coping with all these regulations that it has to comply with.
( Red-tapism: Red tape is an idiom that refers to excessive regulation or rigid conformity to formal rules that is considered redundant or bureaucratic and hinders or prevents action or decision-making.)

Cybersecurity

Fintech companies handle exceedingly sensitive information of the customers, and thus as the emerging leadership, you must be well prepared to fortify your organization against any challenge posed by the internet. The more the financial data of individuals and companies become available digitally, the higher is the risk of cybersecurity breaches.

Accumulating capital

Fintech companies require huge capital, not only to pay off the salaries of the employees but also to need funds for a secure infrastructure. The first step of fund accumulation starts with a good sales pitch, and at times in spite of possessing excellent leadership skills, some falter here.

Complex Industry

The complex working model of Fintech makes it a challenging task for them to maintain a healthy and smooth partnership with banks. Many fintech companies fear the loss of identity and autonomy amongst the vast landscape of large banking organizations.
On the other hand, banks find it risky to work with fintech innovators as they fear of losing reputation. These complex situations become obstacles to the growth of fintech organizations.

Lack of Consumer Trust

Providing financial services in the unbanked market is a challenge in itself due to the lack of trust of consumers, especially in India. People still relate these services with digital scams and are also not yet ready to accept the involvement of digital technology in financial services.

Finding clients is a tough challenge

A business cannot run without customers and clients. Getting a client requires the support of a good platform. However, professional networking sites with a global reach, can provide the new leadership with the much-deserved podium and help you to take your business to newer heights.

Today, everywhere and in every field like health tech, Logitech, Edtech, Traveltech, Enterprise, and Fintech, people use the latest technologies and work by implementing the technologies in their business to get the best results. In India, still, there is a need for more technological strategies in the banking sector. Over 19% of the population still remains unbanked. Here Fintech startups come in. Since 2015, the finance sector has undergone many changes like a change to move towards a cashless economy. The government is proactively using technologies to make India cashless – the launch of India stacking including UPI, digital wallets, e-KYC, Aadhaar, and BHIM are the Indian financial sector.

So, digital technologies play an important role to change the traditional business model in the digital business model. Startups are working in various sub-sectors of Fintech such as mobile POS (mobile-based point of sale), in loans and insurances, and alternative leading among others. Increased access to the internet, have helped efficient and automated financial services solutions. Well, it seems that the Fintech industry is a fast-growing industry and there are so many leading startups that are working very well and provides many financial solutions to the industry. Let us look towards some really innovative ones.