Embedded finance is expected to create $25 billion revenue opportunity for India’s digital and financial services platform by FY30 driven by three axes, according to a report.
Consumer platforms in e-commerce, travel and mobility space are projected to serve 400-450 million users by FY30 and embedding contextual financial services can unlock a $10-15 billion revenue opportunity, the report Elevation Capital in collaboration with McKinsey & Company as a knowledge partner.
India’s unique open digital networks, such as ONDC, are designed to embed financial services. The rise of It is estimated that, collectively, financial services via these networks could generate a potential annual revenue of more than $5 billion by FY30.
The third opportunity lies in embedding lending and insurance for MSMEs via rapidly digitising supply chains.
Supply chain finance and supply chain insurance now represent a compelling $10-12 billion opportunity by FY30, said the report.
Mridul Arora and Vaas Bhaskar, Partners, Elevation Capital, in a joint statement said, “This transformation has been a decade in the making, fueled by the creation of public rails and DPI (such as UPI, KYC, GST), the establishment of large digital channels (spanning both consumer and supply chains), the widespread adoption of new-age core software and middleware, and the acceleration of manufacturing innovation. In this context, embedding financial products is the most effective way to drive product/ market penetration. We don’t see this as just a topline opportunity but as a potential to improve retention, increase affordability and more. We see considerable new value creation in in distribution, manufacturing and software”