fintech ideas that are raking in 2021

fintech ideas that are raking in the most amount of money:

Fintech companies are preferred by investors who want to put their money where they want to make money. One of the initial $3 investments in the first three months of 2021 in India went to fintech.

According to Venture Intelligence, space launches grossed $110 million in the first three months of the year. And most went to finance training company LeapFinance, cryptocurrency trading platform CoinSwitch, and start-up banking company Zolve. Together they accounted for 69% of the total $110 million in investments.

New credit-accepting clients and millennials who have woken up in the stock market to take advantage of its recent volatility have made the fintech crowd a big favorite among venture capitalists. Leap Finance, a two-year company, had its largest investment in the early stages from January to March 2021, with $17 million.

It’s not just an Indian phenomenon. “The business model at the heart of the bank is broken and very lost: the customer,” said Sebastian Siemiatowski, CEO of US e-commerce platform Klarna, in the latest Business Insider Global Trend Report.

Here are the top five fintech ideas that make the most money:

Without credit? flexible.

Not everyone needs a big bank loan. And many cannot go to the bank because they don’t have a credit history or, at best, a limited credit history.

Jai Kisan, an Indian company aimed at helping farmers and others without a documented loan, raised $30 million in its Series A funding round led by Mirae Asset. Existing investors include Blume, Arkam Ventures, and Better Capital.

Other companies try to simplify the process with the “Buy Now, Pay Later” (BNPL) framework. While based on agreements with banks and non-bank finance companies (NBFCs), it has unlocked a new form of unsecured credit distribution that requires no down payment.

The only problem is that interest rates are higher, which may not be ideal for the borrower, but it is good for the borrower.

According to Credit Suisse, deferred payment and deferred payment have a gross margin of 0.7% in a 15-day period. That means every $1,000 rupees you earn earns $70. Assuming a minimum of 100 million customers uses your option, the end result rises to $7 million.

Players like Simpl, LazyPay, Amazon Pay, Paytm, and others have expanded pre-approved lines of credit worth $10,000 to $1 lakh to more than 200 million customers.

The cryptocurrency gold rush

Cryptocurrency is the new competitor for venture capitalists. The concept of digital currency is not entirely new, but investor interest has never been greater, with Bitcoin, Ethereum, and Dogecoin reaching new highs in 2021.

Even with the inherent volatility of the markets, cryptocurrency is similar to the gold rush. People want to make money fast, even if a bubble bursts or rules spoil the party.

Billionaire investor Mark Cuban, who is also one of the “sharks” on the corporate reality show Shark Tank, has invested in more than ten blockchain startups, including CoinDesk. And this year, he’s diving into the world of Indian startups with the launch of the Polygon cryptocurrency. Polygon, which offers its own form of Bitcoin called Matic, has surpassed a market capitalization of more than $10 billion and is one of the top 20 cryptocurrencies in the world.

Unlike Polygon, which has been around for four years, CoinSwitch Kuber is still in its infancy.

The cryptocurrency trading platform, backed by Ribbit Capital, Sequoia Capital India, and others, raised $ 15 million in January during the Series A funding round, the second-largest amount in advance funding from January to March, according to Business Intelligence. collected.

Diversity to diversify stock trading is fueled by Generation Y and Generation Z of the stock market

Cryptocurrency may be the latest craze, but traditional stock markets are the traditional way of investing money. And the pandemic has hit Generation Y, which would have blocked the beginnings of brokerage. “COVID-19 has awakened a new generation of retail investors who have discovered markets and invested in stocks for the first time,” Yani Assia, CEO of the Israeli social trading platform eToro, told Business Insider.

Players like Zerodha, Groww, Upstox, and 5 Paise now have 39.1% market share on active demo accounts, ten times 3.1% in 2017, according to a May 10 Credit Suisse report.

Zerodha was founded in 2010 by brothers Nithin and Nikhil Kamath and is the largest of all. It accounts for 19.1% of the market share and has more than doubled its profits to 1,000 crores in the last fiscal year. And many of them were driven by an influx of customers during the months of the pandemic when the average age of new customers dropped from 32 to 25 to 27.

insurance will not be left behind

As currency markets go digital, insurance isn’t planning the bus. This week, India’s Plum Health Aid Fund raised $ 15.6 million in its Series A funding round led by Tiger Global. The startup works with small businesses to provide health insurance to its employees.

Just as lenders need to partner with banks and NBFCs to provide credit to customers, online insurers need to partner with insurers. Plum, for example, has partnerships with ICICI Lombard, Care Health, Star Health, and New India Assurance.

However, Business to Business to Clients (B2B2C) is just a business model. Others, such as Acko Insurance, try to approach the customer directly. By eliminating the middleman, Acko can pass the savings on to their customers or make more profits.

Fintech startups are preparing to give NPCI some competition

Some digital companies agree that fintech was born. And startups are partnering with larger companies to take their payment platforms to the next level by creating a new umbrella entity (NUE).

The NUEs will be designed to compete with the National Payments Corporation of India (NPCI), which currently operates the United Payments Interface (UPI) and Rupay networks.

Paytm and Zeta Pay, both co-owners worth more than $ 1 billion, have partnered with Ola, IndusInd Bank, PolicyBazaar, and Electronic Payments Services (EPS) to apply for a license from the Reserve Bank of India (RBI).

Zeta Pay’s unicorn status is relatively new. In May last month, TI raised $ 250 million from SoftBank and Sodexo, reaching a valuation of $ 1.4 billion. Paytm, on the other hand, plans to make a public appearance later this year. Sources told Business Standard that the company, led by Vijay Shekhar Sharma, will seek to raise $ 1.5 billion by issuing primary shares before it hits the market.

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