The COVID-19 pandemic has forced governments across the world to lockdown their nations in order to contain the spread of virus and control the increasing numbers of infected people and the surging death tolls. With people from around the world practicing physical distancing by staying inside their homes, the industries and businesses across the globe are experiencing crippling effect of the COVID-19. As day-to-day needs of the people have shrunk down to only essential commodities, many industries are struggling to survive.

Considering the FinTech industry amid the COVID-19 crisis, companies are leaving no stones unturned while working on introducing new products to cope up with the impact of the pandemic. With businesses leaving the brick and mortar venues due to the lockdown, they are now leveraging technology on all fronts. Thus, the FinTech industry is the need of the hour bearing in mind that several businesses will now have to resort to taking their businesses online.

Due to the COVID-19 pandemic, the FinTech industry is most likely to witness an emergence of new sectors in the digital payments, while the sectors that used digital payments rigorously see a downside due to the lockdown.

4 Ways COVID-19 has Impacted the FinTech Industry:
Increased Demand for Contactless Payments
The fear of the COVID-19 spread has led to increase in demand for contactless payments in every industry. In the times of COVID-19 crisis, people across the globe are seeking contactless payment methods and mobile financial solutions. Even while buying essentials from a nearby grocery store, people insist on making contactless payments. According to Mastercard in which 17,000 people from 19 countries were interviewed, 74% said that they will continue using contactless payment even after the COVID-19 pandemic is over. Further, 82% respondents claimed that they view contactless as the cleaner way to pay.

Impact on Capital Funding in the FinTech Industry
With markets are being incredibly volatile due to the impact of the outbreak of COVID-19 and the consecutive lockdowns across the globe, investors of FinTech industry too have become cautious in lending their money to startups. As per a report by CB insights, the total funding to FinTech companies for Q1’20 would settle at around USD 6B —a level not seen since 2017.