Fintech 3.0? What 2026 Holds For India’s Digital Money Machine

by · Inc42

SUMMARY

  • Fintech sector had been evolving for a decade, but 2025 was the year when it demonstrated maturity in a visible and undeniable way
  • As India enters 2026, the sector stands more stable, more accountable and more focussed and the next phase will be shaped not by speed, but by precision and resilience
  • If 2025 was the year India led the world in real-time payments, 2026 will be the year we lead in intelligent payments where AI, biometric identity and global interoperability come together
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As 2025 heads into its final stretch, fintech in India finds itself at a defining moment, shaped by shifting regulations, sharper business models and a renewed push for sustainable growth.

Payments banks such as Airtel Payments Bank and Fino have begun moving toward the small finance bank pathway, signalling a shift from narrow digital rails to full-scale banking ambitions. Large payments players like Razorpay, Airpay and Cashfree Payments, having built depth across domestic payments, are widening their canvas — their move into cross-border remittances comes at a time when India’s outward remittance market reached more than $29 Bn annually in FY25.

Wealthtech and digital payments continued to deepen their presence in the everyday financial lives of millions — UPI alone processed more than 14 Bn monthly transactions by late 2025 — but capital flowed more selectively. Funding volumes dipped from the hypergrowth era, prompting fintechs to prioritise profitability, sharper unit economics and more durable revenue streams.

The IPOs of Groww and Pine Labs in 2025 have added further momentum, reflecting public-market confidence in scaled fintech models. Meanwhile, the steady performance of earlier listed players such as Policybazaar and Paytm has kept sentiment buoyant, reinforcing the view that fintech is a category where investors can take long-term positions with confidence. Their trajectory has signalled that the broader financial ecosystem now sees the sector as essential, not experimental.

The year also signalled a structural shift that had been taking shape for some time. New licensing paths, clearer digital lending norms and targeted permissions in payments collectively showed that fintech had moved into the financial mainstream. It was no longer operating at the margins but recognised as core infrastructure. The momentum from regulators, innovation bodies and emerging AI frameworks only underscored how deeply the sector had begun contributing to the economy.