, India
Photo courtesy of David Dvoracek.

India crackdown on non-bank lending to hit fintech investments

Deal activity in Q2 was 25% lower than the previous quarter.

Things are not boding well for fintech investment in India amidst the local regulator’s continuing crackdown on fintech startups and implementation of stricter lending rules.

Investments in fintech startups in India plummeted 42% in the second quarter of the year compared to Q1, reaching only US$1.8b, according to data compiled by Fintech Global. 

India’s deal activity in Q2 was also 25% lower than Q1, with 96 deals in total.

READ MORE: E-payments poised to replace credit cards in China, Indonesia: Experian

Fintech Global warned that India may have yet another troubling quarter in Q3 following the Reserve Bank of India’s decision to bar the practice of loading non-bank prepaid payment instruments (PPIs). Dozens of fintechs have reportedly been informed of this change.

Non-bank PPIs is a primary way that Indian start-ups facilitate lending. With the RBI’s ban, non-banking financial companies (NFBCs) cannot give credit lines to merchants, whose money can now only be routed to regulated bank accounts of customers.

READ MORE: India’s mobile wallet payments market to hit $4.1t in 2025

Fintech start-ups are reportedly speculating that banks have lobbied the RBI to reach this decision, Fintech Global added.

Follow the links for more news on

Join Asian Banking & Finance community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Event News

Event News

BDO Capital Named as PH’s Corporate and Investment Bank of the Year for 5 Consecutive Years Co-Written / Partner
BDO Capital & Investment Corporation (BDO Capital) has been recognized as the country’s Corporate and Investment Bank of the year for the 5th straight year at the Asian Banking & Finance Awards. BDO Capital’s remarkable achievement is a testament to its consistent excellence in delivering best-in-class investment banking services across various product lines in the Philippine capital markets.