The Indian economy was cash driven economy till demonetization happened. Demonetization created a desperate need for digitization of financial transactions. Startups have been dabbling in the fintech space; but this acted as a trigger for the rise of fintech startups in India.
At the time of demonetization, most fintech startups dealt mainly with digitization of primary financial transactions. But the situation has changed now. The focus of fintech startups shifted to digitizing secondary transactions such as lending. Fintech startups like Earlysalary, Moneytap and Kissht are working in consumer lending business and have started expanding their presence in tier 2 and tier 3 Indian cities.
According to Indian tech startup funding report for Q1 2018 by inc42.com, Fintech sector got 21.4% of total funding in Q1 2018. Startups working in consumer lending stole the limelight. Startups working in the areas of business lending and providing capital to SMEs have also digitized their processes. Artificial Intelligence backed by digitized platforms have helped the startups make the process easy for the users.
Technology penetration has been low in Agricultural segment since independence. Agri-tech startups are working on IoT based solutions for farmers to increase their productivity and creating feasible solutions for fighting natural calamities. Some startups are researching and developing systems for weather prediction. Startups like Agstack, Agnext and Aarav Unmanned Systems are working on technologies solutions to provide Analytics as a Service (AAAS). This will help farmers achieve better crop nutrition and crop protection.
Farmers are receiving positive inputs about crop advisory and weather information coupled with the best crops to grow. This will improve the productivity as well as the sustainability of the crops. Indian startups working in crop insurance sector have uncertain future as farmers are not willing to pay the required premium. Most of the Indian farmers who own small piece of land (of about 2-4 acres) are the biggest challenges for Agri-tech startups.
Electric Vehicle Mobility
Fuel prices in India are on a constant rise. Also, with the commitment made by the government of India to take all vehicles electric by 2030; Electric vehicles are beginning to look interesting. Startups like Ather Energy and Menza are venturing into research and development of electric vehicles. Ather Energy is set to launch its first electric bike in June 2018. Ather Energy has started installing charging units in Bangalore.
Designed by Menza Motors Pvt. Ltd, electric Motorcycle, ‘Menza Lucat’ was unveiled in Noida Auto Expo in February 2018. Ahmedabad based startup ‘Menza Motors’ is developing a battery charging infrastructure along Delhi-Agra highway. The EV Company has set up several charging stations along the Delhi-Agra highway and plans to electrify nine other national highways as well.
Development of charging infrastructure will help in better acceptance and management of electric vehicles in India. Tremendous amount of money is invested in the research and development of these electric vehicles resulting in exorbitant prices. The competitive and affordable pricing strategy is going to be the game changer for these EV startups.
With startups working for comfort and convenience of common man, it will be interesting to watch out their evolution in near future.