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“It’s easy to get caught up discussing why fintech is sexy and hot,” said Satyen Kothari, co-founder of payment gateway solution Citrus Payments which was acquired by Naspers-owned PayU in September last year. “But these are just tools. We need to solve real problems, instead of just creating more tools,” said the entrepreneur at Fintegrate Zone 2017, a fintech thought leadership conclave organised by startup accelerator Zone Startups India, in Mumbai on Friday.
Kothari, who is now busy setting up Cube – a banking app that aims to simplify money management, stressed on the need to set up “a big but clear goal” and have companies drive towards that goal. The market needs to be sliced and problems areas within each segment need to be thought through, he said.
For instance, the bottom of the pyramid faces the issue of government subsidies not reaching them, the middle class feels neglected by banks, while the wealthy worry about how they can best grow their wealth. “Solve a real problem. Also, Bharat is not one unified country, so you need to be sure who you are solving for,” he said.
Too much focus is put on changing consumer behaviour, Kothari said. Instead, if “real problems” are solved, consumer behaviour will automatically change. Ride-hailing app Uber for instance, solved the problem of people not being able to find taxis easily and not having the exact change to pay the driver, leading customers to readily switch over to the technology. “A great product sells itself,” said Kothari.
The Indian fintech market is expected to double from about $1.2 billion now to $2.4 billion by 2020, according to a joint report by Nasscom and KPMG. Triggered by a surge in e-commerce and smartphone penetration, India’s traditionally cash-driven economy has lapped up the fintech opportunity.
Over the last two years, India has seen a surge in fintech startup investments as more services have become digital payments-friendly than ever before. A smartphone boom in the country, helped by affordable 4G smartphones that aggressive Chinese vendors have flooded the country with, has added impetus, while wireless providers have slowly started expanding their services.
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