Driving Digital Transformation The Intertwined growth of IT and Fintech sectors in India

• The Indian economy has recorded immense growth in the past few years, and the contribution of the IT and BPM sector in this growth has been formidable. The IT industry accounted for 7.4% of India’s GDP in FY22, and it is expected to contribute to 10% of India’s GDP by 2025.
• With the advent of new technological innovations and digitization of many processes that were once manual, the Indian IT sector is prepared for the next step of its revolution.
• According to reports by IBEF (India Brand Equity Foundation), the market size of the IT and BPM industry in India touched $6.96 billion in FY2021 and is projected to reach $19.93 billion by FY2025.
• In the modern world economy, India is the largest exporter of IT services in the world, with a revenue of $193 billion in 2022-23 with a growth of 12.3%.
• The growth of various fintech solutions providing companies in India has been immense in the past 5 years. The primary contributing factor to the growth of fintech in India has been a dependable technological backbone owing to the growth of the IT sector.
• New and upcoming fintech startups depend greatly on the existing IT infrastructure and digital platforms to provide innovative and robust financial services to customers. For eg: 50Fin, Simpl etc.
• Even though the growth of the IT sector has slowed down, falling from 8.4% to 3.8% in the last year, the fintech sector continues to grow at a steady rate of 15% and is set to reach a valuation of ~$350 billion by 2027.
• Technological advancements, skilled workforce and positive ecosystems of the IT sector have driven growth in fintech, as it stabilises itself as a standalone powerful entity in the Indian economy.

Estimated market size of IT and BPM sector.

Blog By: Aditi Joshi, Assisted By: Megh Jadhav