New Delhi, July 7 (IANS) India’s fintech sector is shifting focus from growth to trust, governance and resilience as nearly 59 per cent of firms rank reputation and brand risk as a high‑severity concern or the highest risk facing them, a report said on Tuesday.

The report from Fintech Association for Consumer Empowerment (FACE) and Grant Thornton Bharat said reputation risk was followed by interoperability and infrastructure risk at 51 per cent.

The report noted that customer trust can be affected by issues ranging from data breaches and cybersecurity incidents to misconduct by unauthorised entities, making reputation an outcome of governance, compliance, customer experience and data protection.

The findings reflected fintechs’ growing dependence on digital public infrastructure such as UPI and Aadhaar, along with confidence in the continued evolution and resilience of India’s digital infrastructure ecosystem.

India’s fintech ecosystem has become a critical pillar of the country’s digital economy, powered by digital public infrastructure such as UPI, Aadhaar, e-KYC and Account Aggregators.

Market competition and conduct risk ranked third in terms of risks and carried an average severity score of 6.9, while data access, privacy and protection scored 6.6 and cybersecurity, technology and business continuity scored 6.5, the report added.

Risk rankings are based on weighted average severity scores assigned by respondents on a scale of 1 to 10.

The report highlighted growing emphasis on consent management, customer transparency and enterprise-wide data governance, making effective data stewardship a strategic business priority.

“Balancing profitability, growth and trust has become one of the key drivers for the fintech ecosystem, which is the key message that the Fintech Barometer report reinforces. The fintech ecosystem across the domains of payment, investment, credit and insurance has stronger revenue and governance models than a decade ago, helping them walk the path of growth,” said Vivek Iyer, Partner& Financial Services Risk Advisory Leader, Grant Thornton Bharat.

Around 46 per cent respondents rated cyber and continuity risks as high severity, reflecting continued investment in cyber resilience, fraud prevention and operational continuity.

Meanwhile, fraud, AML/CFT and financial crime, along with macroeconomic and funding risk, were viewed as comparatively manageable within the current operating environment, supported by regulatory interventions, improving fraud controls and continued investor confidence in India’s fintech sector.

The report is based on a survey of 39 FACE member fintechs across lending, payments, regtech, collection-tech and techfins.

—IANS

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