The digital lending market in India has shown impressive growth in recent years. According to a report by Praxis Global Alliance, the market grew at a Compound Annual Growth Rate (CAGR) of 33% from FY19 to FY23, reaching Rs 2,905 thousand crore in FY23 from Rs 913 thousand crore in FY19.
During the same time period, digital transactions also saw a significant increase, with a 44% year-on-year surge from Rs 46,616 crore to Rs 92,267 crore. This growth can be attributed to the rise of fintech startups in the country, which have presented various challenges and opportunities for the sector.
Fintech disbursement amounts in India have grown at a CAGR of 41% from FY21 to FY23. A new roadmap for fintech in India is emerging, focusing on untapped sectors, partnerships with traditional financial institutions, and governance and compliance.
The report also highlights the use of AI/ML technologies by fintech lending players to develop advanced underwriting models for faster and more accurate credit assessment. This next generation of fintech, known as ‘fintech reloaded’, is expected to bring significant changes to the financial services industry.
Additionally, the rapid adoption of UPI by fintech has revolutionized peer-to-peer payments in the country. Overall, the future looks bright for the digital lending market in India as it continues to evolve and innovate.