Maharashtra Minister for Industries, Uday Samant, has pledged to extend full support to small and medium-sized enterprises (SMEs) and startups, offering them the same level of attention and assistance typically reserved for ultra-mega projects. This commitment comes as part of the state’s broader strategy to establish Mumbai as a leading global fintech hub.
Samant made this announcement while inaugurating an exhibition at the 9th Global Economic Summit on ‘Fintech: Accelerating the Digital Revolution,’ hosted by the World Trade Center Mumbai and the All-India Association of Industries (AIAI) from August 8-10, 2024, at WTC Mumbai.
Speaking at the event, Samant emphasized the transformative impact of fintech on the financial services industry, highlighting its potential to significantly benefit MSMEs and startups. He reiterated the Maharashtra government’s dedication to realizing the Prime Minister’s vision of making Mumbai a global fintech center. “Our government is committed to giving SMEs and startups the same priority as ultra-mega projects, recognizing that these enterprises are the backbone of our economy.
As India strives to become a $5 trillion economy in the coming years, Maharashtra is poised to contribute significantly to this goal, with its own $1 trillion economy target,” Samant stated. He also expressed the government’s intent to revitalize struggling industries, particularly MSME units within Maharashtra, and called for the support of WTC Mumbai and AIAI in this effort.
V. Anantha Nageswaran, Chief Economic Advisor to the Government of India, underscored the rapid growth of the fintech sector in India over the past five years, noting that the country now ranks as the third-largest fintech service provider globally, with a fintech adoption rate of 87%, compared to the global average of 64%. He further highlighted that India attracted 15% of global fintech investment.
Nageswaran pointed out that the digital lending market, valued at $270 billion in 2022, was projected to reach $350 billion by 2023. In her address, Nidhi Choudhari, CEO and Nodal Officer of the Maharashtra State Innovation Society, highlighted that Maharashtra, particularly Mumbai, is home to the highest number of fintech startups in India, creating a conducive environment for their growth.
She elaborated on the support provided by the Innovation Society, including assistance with national and international patents, quality certifications, and the operation of over 28 incubation centers, many of which are supported by government grants of up to ₹5 crore. These incubation facilities offer seed capital and accelerator support to startups.
Choudhari also mentioned two dedicated funds for startups: the Maharashtra Innovation and Transformation Capital, supported by IDBI Capital, and a ₹100 crore fund backed by SIDBI with World Bank support. Additionally, she noted that winners of the state’s startup competition receive work orders from the Maharashtra government, with the 2016 public procurement policy allowing startups to secure up to 10% of government department work orders, exempt from Earnest Money Deposit (EMD) requirements.
Ashish Shah, Director of the Division of Country Programmes (DCP) at the International Trade Centre in Geneva, expressed confidence in Mumbai’s potential to become a global fintech hub, noting that it currently boasts the second-fastest-growing fintech ecosystem in the world. He predicted that the city would produce more fintech unicorns in the near future.
Shah also emphasized the opportunities for Indian fintech companies in Africa, where a significant portion of the population remains unbanked. He encouraged Indian firms to seize the opportunity to provide fintech solutions in Africa, particularly with the advent of the Africa Continental Free Trade Agreement (AfCFTA), which offers a unified market.
Vijay Kalantri, Chairman of WTC Mumbai and President of AIAI, suggested that the state government should consider reviving SICOM and the Maharashtra State Finance Corporation to enhance funding for MSMEs in the state. Rupa Naik, Executive Director of WTC Mumbai, highlighted the potential of fintech solutions to address the ₹19 lakh crore credit gap faced by MSMEs in India, noting that improved access to credit could enable these enterprises to expand, create jobs, and contribute more to the GDP.
Somesh Batra, Vice Chairman of WTC Mumbai, emphasized the need for continuous innovation in fintech, given its role as both an enabler and disruptor in the business world. He also called for careful implementation of fintech solutions to minimize disruption to existing businesses.
Carolina Quintana, Director for the Asia Pacific Region at the World Trade Point Federation, pointed out that as technology advances, financial services such as savings and insurance will continue to evolve. She mentioned her role in a Swiss association that enhances organizational trust through certification, which in turn helps certified companies access financial services and global markets.
Jayakumar S. Pillai, Deputy Managing Director of IDBI Bank, highlighted the role of the RBI’s technology sandbox, innovation hubs, artificial intelligence, machine learning, and blockchain in driving fintech evolution. Anindya Sunder Paul, Chief General Manager of SMEBU at State Bank of India, discussed how fintech could be instrumental in achieving the Government’s vision of a digitally empowered ‘Viksit Bharat.’
Paul noted that 97% of SBI’s transactions are conducted on digital platforms, with 63% of savings accounts being opened digitally via the Yono App. He also mentioned the bank’s adoption of digital technologies across various credit segments, including agriculture, MSME, housing, and car loans, with pre-approved business loans for MSMEs now fully digitized.
