Indian fintech startups are leveraging generative AI to reduce costs and enhance efficiency. The results speak for themselves.
“Stock-broking platform Dhan reduced customer support costs by almost 30% using generative AI.” “Payments company Easebuzz reduced average merchant query response time from around 20 minutes to a few seconds by deploying its AI assistant ERA. “Banking technology firm Zeta now reconciles transactions for 208 million credit card accounts in about 40 minutes, down from several hours earlier.”
These aren’t isolated wins. They represent a broader shift across India’s fintech sector.
Why It Matters Now
Tiffany Bloomquist runs AWS’s startup business across Asia-Pacific. She visits India almost every quarter now. The reason is apparent: generative AI has become the fastest route to better customer experience.
Three factors drive this surge in Indian fintech. First, the government’s India Stack provides ready-made digital infrastructure. Second, “India now has more than 240 generative AI startups, compared to about 65 in mid-2024”. Third, AWS offers startups cloud credits of up to $1 million through its generative AI accelerator program.
“Seven Indian startups have joined the current AWS Generative AI Accelerator cohort.”
How It Solves Key Problems
Dhan serves three million traders. The company was drowning in know-your-customer checks. They trained a language model on their own policy documents. Now it answers 25% of queries automatically. Average wait times dropped by half.
Easebuzz faced constant calls from merchants about integration problems. Their new assistant ERA reads messages and compares them with technical manuals. It provides step-by-step fixes in real-time. Redundant tickets dropped 80% thanks to startup automation.
Zeta handles millions of daily transactions. Every night, merchants queue transactions for processing. Their AI-powered engine predicts heavy bursts. It reconciles accounts in 40 minutes versus hours before.
Yubi uses large language models for credit scoring. The system feeds on public filings and bank statements. Risk models update in hours instead of days. Borrowers wait one-third less time for funding offers.
Strategic Advantage for Indian Businesses
The standard approach is simple. Companies distil their knowledge into AI models. They surface it through chat interfaces. They run it on servers that scale only when needed.
“We used to automate servers,” Bloomquist said. “Now we’re automating compliance, advice, and trust. Founders who seize that shift will shape the next decade of finance.”
This creates real competitive advantages. Companies reduce operational costs. They improve response times. They handle larger volumes without proportional staff increases.
What Business Leaders Should Know
Nandan Nilekani, Co-Founder and Chairman of Infosys, offers a unique perspective on the challenges of implementing AI. “People are excited about AI, but the challenges of using it are similar to those in other areas. We need to change habits. It’s important to adjust the workflows in businesses and government so that AI is included in their processes.”
He emphasises the effort required: “AI doesn’t mean it’s going to be easier to do. It’s going to take the same effort, if not more effort. Because you’re trusting the machine to make more decisions to ensure that it works.”
Market Impact in India
Investors are taking notice. Significant funding flows into AI-driven fintech ventures. The ability to harness AI effectively determines future success in Indian fintech.
Competition in fintech will intensify. Companies must refine their AI adoption strategies to ensure effective implementation. Those who integrate AI into core operations gain sustainable advantages.
Nilekani also notes the opportunities and risks: “While embracing AI will bring a goldmine of opportunities, it will not be entirely without some foreseeable risks. Regulatory variances across regions will need to be incorporated into one’s strategy.”
Risks and Considerations
Implementing generative AI requires workflow changes. Companies must train staff on new systems. They need to ensure AI decisions remain trustworthy.
Regulatory compliance across different regions adds complexity. Early adopters face integration challenges. Success requires sustained effort and strategic thinking.
However, the evidence from Indian fintech demonstrates its potential. Companies that act now position themselves for the next decade of growth.
