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      India’s fintech sector is entering a new phase-one defined not just by innovation and scale, but by resilience, governance, and long-term sustainability. The report India’s fintech evolution…from growth to resilience, published by KPMG in India, offers a comprehensive investor-focused analysis of this transition. It highlights how fintechs are recalibrating their strategies to align with evolving investor expectations, regulatory frameworks, and market dynamics.

      Over the past decade, Indian fintechs have transformed how financial services are accessed and consumed. From solving frictions in payments and lending to driving financial inclusion, the sector has delivered immense value to individuals and businesses. However, the journey ahead demands more than isolated innovation-it calls for integrated value propositions that transcend silos. Embedded finance, AI-powered solutions, and governance maturity are now central to the next wave of fintech evolution.

      Key highlights of the report

      Trust as a growth enabler

      The report introduces the Trust Score 1.0 Blueprint, a framework designed to assess fintechs on operational reliability, model governance, and regulatory hygiene. This framework can help streamline procurement, reduce onboarding friction, and promote fair pricing-critical for institutional investors seeking long-term value

      Digital Public Infrastructure (DPI) as a catalyst

      India’s DPI-anchored by UPI, Aadhaar, and Account Aggregator-has laid the foundation for frictionless origination and scalable innovation. These interoperable layers are enabling secure, consent-driven data sharing and personalised financial experiences

      Regulatory maturity and compliance

      India’s evolving regulatory landscape is shaping a more transparent and stable fintech ecosystem. Fintechs that embed compliance into product architecture from the outset are better positioned to de-risk scaling and attract institutional capital

      Global competitiveness

      India ranks among the top fintech ecosystems globally, with over 14,500 fintechs. The country’s mobile-first population, progressive regulatory frameworks, and strong digital infrastructure position it alongside global leaders like the U.S., U.K., Singapore, and China. The report benchmarks India’s fintech metrics-such as mobile payment adoption, digital skills index, and funding volumes-against these peers to highlight India’s strengths and areas for improvement

      Exit readiness and capital efficiency

      With extended investment horizons, fintechs must demonstrate clear paths to IPOs, M&A, or secondary liquidity. The report outlines how companies can institutionalise governance, financial discipline, and integration-ready operations to become attractive investment targets

      Leadership and talent strategy

      Investor confidence is increasingly tied to the depth and diversity of fintech leadership teams. The report emphasises the need for glocal leadership-professionals who combine global perspectives with local execution capabilities. Building resilient, execution-driven teams is essential for navigating regulatory complexity and scaling responsibly

      Investor priorities are shifting

      Funding in India’s fintech sector has declined from USD 3.1 billion in H1 2021 to USD 1.5 billion in H1 2025, reflecting a global shift toward cautious, quality-focused capital deployment. Mature sub-sectors like lending and payments now account for nearly 60% of total funding, driven by their ability to deliver predictable returns. Investors are backing fintechs with proven unit economics, disciplined customer acquisition costs (CAC), and differentiated outcomes

      Emerging opportunities

      The report identifies high-growth segments including:

      • Digital lending: Leveraging e-KYC and alternative credit scoring to unlock access for underbanked populations
      • Regtech: Streamlining complex regulatory workflows, enabling automation of compliance processes related to KYC, AML and data privacy under RBI, SEBI and IRDAI norms while significantly reducing manual effort
      • Wealthtech: Scaling AI-powered advisory and fractional ownership models to democratise investing
      • Embedded finance: Integrating financial products into non-financial platforms to enhance accessibility
      • Private credit: Offering scalable funding pathways for balance-sheet-heavy fintechs with governance maturity

      Resilience as a competitive edge

      Operational resilience-through cybersecurity, incident response, and business continuity planning-is now a baseline expectation. Fintechs must solve problems in a faster, better, and more cost-efficient manner, with all three attributes applied simultaneously. The report calls for fintechs to evolve from disruptors to institutions anchored in trust, transparency, and long-term viability

      Future outlook


      India’s fintech sector is transitioning from hypergrowth to purposeful resilience. The next wave of capital deployment will be more selective, focused on sustainable business models, governance maturity, and measurable impact. Innovation will remain a key differentiator, but execution, compliance, and investor alignment will define success.

      The report concludes with a call to action for founders, investors, and policymakers: to build institutions that are not only innovative but enduring-anchored in trust, driven by outcomes, and ready to lead the next chapter of financial transformation.This report provides policymakers, industry leaders, and stakeholders with a roadmap to unlock the full potential of India’s space sector. By combining technical capability, service-oriented models, and strategic adoption, India is positioned not only to meet domestic requirements but also to shape its role in the global space economy of the coming decades.

      India’s fintech evolution…from growth to resilience

      A blueprint for enabling fintech scale through compliance, trust infrastructure, differentiation, and leadership

      Download the report (1.8 MB)
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      Key Contact

      Vishnu Pillai
      Vishnu Pillai

      Financial Services Technology Leader, Office Managing Partner - Kochi

      KPMG in India

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