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Over 71% Financial Services, Fintech Firms Keen On Developing Embedded Finance Products: Report
The study also found that 44 per cent of the financial services and fintech firms which are investing in embedded finance believe it will increase revenue
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A latest report has revealed that financial services and fintech companies from India are eager to invest into developing embedded finance products in the next 12 months.
According to the report, more than two-thirds (71 per cent) of financial services and fintech firms will significantly invest in developing embedded finance products. The study also found that 44 per cent of the financial services and fintech firms which are investing in embedded finance believe it will increase revenue.
Meanwhile, 37 per cent of non-financial firms that see an impact from embedded finance on their business will respond by increasing their tech or R&D budget in the next 12 months.
The study also found that 84 per cent of financial services respondents believe DeFi, which uses blockchain and digital asset technology to manage financial transactions, represents a major growth opportunity for their organisation. However, a higher percentage (89 per cent) assert the need to better understand the risks of decentralised finance before participating.
The FIS study also found that nearly all financial services companies in India (90 per cent) view ESG as an opportunity to attract increased investment. “Decision makers firmly believe (87 per cent of financial services respondents) that ESG can improve their competitiveness in the market,” the report said.
The report revealed that 83 per cent of financial services firms in India are developing new ESG products and services to tap into this growing demand.
“Despite recessionary pressures and challenges in the global economy, companies in the financial services, fintech, and non-financial sectors in India are turning to innovation to succeed in 2023 and beyond. Given the widespread agreement on the effects that embedded finance, DeFi, ESG, the metaverse, and cryptocurrencies will have in the short-term, it's not surprising that businesses are investing now to prepare for an impending surge in demand," said Rajsri Rengan, India Head of Development, Banking and Payments, at FIS.