Email: contactus@precisa.in
Phone number: +91 98450 76647
  • Solutions
    • DSA Service
    • Forensic Investigation
    • Bank Statement Analysis
    • GSTR Analysis
    • Credit Report Analysis
    • Account Aggregator Integration
    • Anti-Money Laundering (AML) Analysis
  • APIs
  • Clients
  • About
  • Blog
  • Pricing
  • Sign In
Try Now
Fintech

How Fintech Firms Improve Finance and Web Payments in Rural India

November 5, 2022 precisateam No comments yet
How-are-Fintech-Companies-Strengthening-The-Banking-and-Online-Payment-Sector

“Where there is a will, there is a way.” This is how the fintech sector navigated the rocky roads of rural India. From demonetisation,  India recognised the need to adopt new technology and embrace digital payments. Rural India lagged behind the rest of the nation in the digitalisation process.

India’s fintech market is the third largest in the world and is growing rapidly. India’s fintech industry is speculated to grow at accelerated rates globally, with a market value of $150 billion by 2025. Without a doubt, fintech companies can radically change India’s financial services and financial inclusion landscape.

The rural sector needed to pick up the pace during the pandemic. Thanks to the efforts of various fintech companies, the rural populace has mastered the use of digital banking and payment methods.

The Rise of Digital Transactions During Lockdown

Rise-of-Digital-Transactions-in-Lockdown

Digital payments have seen rapid development in India during the lockdown despite growing concerns over the spread of Covid-19, which caused a decline in physical transactions. According to data from the Reserve Bank of India (RBI), the total digital transactions during the pandemic increased from 3,412 crores in 2019–20 to 4,371 crores in 2020–21.

People were encouraged to use digital payments to simplify their lives and benefit from numerous government financial inclusion programs like Jan Dhan Yojana.

Role of Fintech Companies in Making Rural Populace Tech-Friendly

When the world shut down and physical transactions threatened humanity, digital transactions surged and rural India was on its way to shake hands with technology. Fintech companies worked hard to make safe and convenient banking services available to people in rural areas.

With the help of assisted payment businesses, millions of physical stores now provide cash withdrawal and money transfer services. Numerous businesses also set up mobile vans, point-of-sale (PoS) devices, micro ATMs, and kiosks throughout rural India to digitally collect utility bills, mobile bills, and other financial transactions from far-flung communities. These payments are made easier through online banking, UPI, Prepaid Payment Instruments (PPI), etc., and with cash.

1. Rural India and Assisted Payments  

Irrespective of whether they live in their hometowns or the cities, rural clients are still disproportionately underbanked. These customers have shifted to assisted payments for their banking and financial needs since they are practical, accessible, and available outside regular banking hours.

With the assistance of fintech firms, neighbourhood mom-and-pop shops and small merchants can now provide customers with a wide range of banking and financial services. These locations have developed into a one-stop shop for customers seeking services like Aadhar-Enabled Payment Systems (AePS), micro ATMs, remittances, bill payments, etc. These business partners assist fintech companies in extending their services to the last mile.

2. Rise of Micro ATMs

Micro ATMs (MATM) through business correspondents (BCs) have emerged as a more affordable retail banking strategy than traditional ATM operations. Over the past two years, MATM and AePS transactions have increased by more than 200% due to increased cash withdrawals during the pandemic (for medical expenses and to avail of government cash subsidies).

The success of the government’s cashless incentives and Direct Benefit Transfers can be attributed to the existence of assisted payment companies in India’s rural areas. The demand for MATMs and AePS surged during the lockdown due to near-doorstep services offered by banking BCs.

According to RBI data, banks deployed 4.94 lakh MATMs by the end of August 2021, up from 3.07 lakh the previous year. This represents an increase of 60.9%. Cash withdrawals from MATMs rose to INR 26,830 crore in August this year from INR 19,513 crore last year. Not to mention, AePS and MATMs made it possible for millions of clients to withdraw money through the Jan Dhan Yojana and PM-Kisan Samman Nidhi during the pandemic.

These cash withdrawal options were used to pay for goods. Consumers can pay for their purchase using a biometric scan and an Aadhaar number by using AePS’s Aadhaar Pay service. Additionally, consumers can use MATM devices to accept card payments and serve as PoS machines.

3. Making Rural India Digital Savvy

Given that almost 62% of the country’s population resides in rural and small-town areas, providing access to basic financial services is still a top priority for the government and fintech firms. Fintech companies are digitising the cash that a sizable portion of the nation’s workforce generates through various banking and financial services. Through the range of digital payment options available in rural India, these stakeholders are advancing digital empowerment by expanding financial inclusion.

Additionally, as stated in Budget 2022, the government would emphasise adopting digital education across the country. The finance minister also stated in the budget that the government would develop new universities and courses at GIFT City to improve fintech education.

Final Thoughts

According to RBI data, start-ups and venture capital firms are swarming into the digital lending sector since there is an untapped audience of 120 million nominally employed Indians without credit cards. Following this pattern, digital lending start-ups received 44% of Fintech funding in 2020. The prognosis for the Fintech industry is positive, with more funding and increasing cooperation between established and new participants in the digital lending market.

India is poised to make a significant shift toward financial inclusion, with tech-driven solutions focusing on eliminating long-standing barriers like the rural-urban divide.

Fintech will greatly contribute to this endeavour and play a crucial role in the credit, lending, and borrowing landscape as it changes. With its powerful bank statement analyzer, Precisa is one such fintech that is revolutionising the banking industry by processing transactions swiftly, effectively, and safely. Book a free demo today!

  • AI in Fintech
  • fintech

Post navigation

Previous
Next

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Search

Categories

  • Bank Statement Analysis (122)
  • Credit Appraisal (35)
  • Digital Lending (120)
  • Fintech (81)
  • NBFC Software (3)
  • Uncategorized (1)
  • Understanding Precisa (17)

Recent posts

  • The͏ C͏re͏dit Bur͏e͏͏a͏u͏ & Bank Stateme͏͏nt Co͏͏mbi͏nation
    Credit Bureau & Bank Stateme͏͏nt: Ho͏w the Duo Reduc͏es Lending ͏͏R͏isk
  • RBI's Decision to Exclude Fintech Loans
    Understanding RBI’s Decision to Exclude Fintech-Sourced Loans from Default Coverage
  • Extract Hidden Insights from Consumer Credit Bureau Reports
    Beyond CIBIL Scores: Pulling Hidden Insights from Consumer Credit Bureau Report

Tags

account aggreagtor AI in Fintech API To Get Bank Transactions Automated Bank Statement Analysis Bank Bank Accounts Bank Financial Statement Analysis Bank Statement Analysis Bank Statement Analysis API Bank Statement Analysis Tools bnpl Case Study cash flow analysis co-lending Credit Appraisal Credit Appraisal Software Tools credit bureau Data Quality and Integrity digital lending due Due Diligence early embedded finance Financial Data Analysis Tools financial inclusion Financial Industry financial security financial startups Financial Statement Analysis Software fintech fintech companies fintech startups Fraud Investigation GST GSTR gstr analyzer Lenders loan management system Loan Rates money laundering MSME nbfc open banking precisa rbi

Continue reading

RBI's Decision to Exclude Fintech Loans
Fintech

Understanding RBI’s Decision to Exclude Fintech-Sourced Loans from Default Coverage

June 27, 2025 precisateam No comments yet

In a decision that could drastically change how fintech companies associate with non-banking financial companies (NBFCs), the RBI, on June 6, 2024, ruled that Default Loss Guarantees (DLGs) by fintech on their loans can no longer be valid while determining provisions or credit loss buffers. This actually means NBFCs cannot depend on fintech-provided guarantees to […]

Extract Hidden Insights from Consumer Credit Bureau Reports
Credit Appraisal

Beyond CIBIL Scores: Pulling Hidden Insights from Consumer Credit Bureau Report

June 23, 2025 precisateam No comments yet

Traditional credit scoring, led by CIBIL and other bureaus, has been the backbone of lending decisions for many decades. However, with the undeserved and new-to-credit segments’ increasing need (and demand) for loans and the microfinance delinquency rate moving up to 4.3% in 2024, lenders are realising that single scores only tell half the story about […]

Challenges Faced by fintech Companies
Fintech

4 Major Challenges Faced by Fintech Companies in Document-heavy Lending

May 21, 2025 precisateam No comments yet

Despite showing promising signs of revitalising Indian lending, the challenges faced by fintech companies are by no means insignificant. These generally include a combination of a complex regulatory framework, evolving operational guidelines by the Reserve Bank of India (RBI), and most importantly, document-heavy processes. From Know Your Customer (KYC) documents and income proofs to property […]

Mumbai

403, Mayuresh Chambers, 4th Floor, Sector 11, CBD Belapur, Navi Mumbai, Maharashtra 400614

https://g.co/kgs/buJcESj
Pune

Rachana Park, 3rd Floor,Atreya Society,
Off. Senapati Bapat Marg,Wadarvadi, Pune,
Maharashtra – 411016

Links
  • Cancellation Policy
  • Terms Of Use
  • Privacy Policy
Subscribe to our newsletter

Sign up for our weekly newsletter to get the latest news, updates & amazing offers delivered directly in your inbox.




    © All Rights Reserved • Precisa • MADE WITH ❤️ & ⚡ IN INDIA.