B2B infra: B2B infra, AI and DPI plans are brewing at 2025-ready fintech

Getting into 2025, the fintech sector could see founders focus on business-to-business infrastructure solutions, building secured credit products, second-order services on digital public infrastructure (DPI) and deployment of artificial intelligence in the areas of compliance and fraud detection.If 2024 saw financial regulators cracking down on fintech startups because of regulatory lapses, industry insiders said over the next few months they will focus on automating their compliance business. This is important for fintech startups at a time when compliance is becoming a major cost item for them.

“Leveraging AI-driven tools for real-time fraud detection and adaptive risk management will be key to preserving trust and strengthening the integrity of digital payments,” said Akash Sinha, cofounder of Cashfree, a Bengaluru-based online payment aggregator. AI will be increasingly used to speed up the delivery of products, said others. While team sizes might not go down drastically, efficiency will go up as generative AI will be used extensively in coding, marketing, building better sales pitches and such. “A lot of the drudgery work will go away and marketing executives will get more time to focus on personalised client pitches, undertake aggressive marketing campaigns and speed up product delivery,” said Harshil Mathur, cofounder, Razorpay. Venture investors who have reported a major slowdown in terms of fintech investments in the last two years are hopeful that they will get to see more early-stage startups solving for challenges around debt collections, underwriting and building innovative solutions on DPI.

Data from Venture Intelligence showed that in 2024, around $1.4 billion were invested in the fintech sector, almost the same as in 2023 but only around a fourth compared with 2022 when investments had totalled $5.5 billion. “I can see the space around DPI getting dense, more second-order plays will emerge there and I am hoping to see more folks looking at secondary stake sales in a more consolidated fashion,” said Varun Malhotra, partner at Quona Capital.

While the slowdown in consumer lending has resulted in many investors staying away from the space, industry insiders said credit will be the cornerstone for the sector. Areas such as business lending, secured credit and supply chain finance are sectors which will be attracting venture dollars, they added.

“We are actively looking at the trade credit space, B2B lending and fintech infrastructure players, looking at the rapid digitisation of the economy; these sectors will see interesting credit disbursal models emerge in the coming years,” said Sahil Gupta, partner at Sprout Venture Partners.