During the month gone by, the coastal city of Vishakhapatnam was abuzz with various financial technology startups displaying their products and competing to grab the attention of their stakeholders. This was surely a step closer towards realizing CM Chandrababu Naidu’s dream of developing a FinTech hub in the country.
In a rather optimistic mood, the CM declared that Vizag will gain the recognition of being the Fintech hub of India by 2019 and will go on to become the hub of the world by 2023. The division of Andhra Pradesh into AP and Telangana has surely disrupted their economy, as in the aftermath they failed to reap the most of the boom of startups and innovation that was making the round of the country.
Professor K.Nageshwar, who is the editor of the newspaper named Hans India and also a political analyst said that when a state is divided, its economic advantages and disadvantages are also segregated between the resultant states. He further added that through Hyderabad, the booming IT sector went to Telangana.
According to him, the city of Vizag does not have the technological foundation that is possessed by Hyderabad. As the Chief Minister of the unified AP, CM Chandrababu Naidu had played a pivotal role in converting Hyderabad into a major IT hub. However, with the bifurcation of the state, he has to put in additional efforts to recreate the magic in the state.
Experts believe that though the city of Hyderabad has some advantages over Vizag, it has surely missed a number of great opportunities because of the political upheaval that that caused the division of the unified state.
With the pre established infrastructure and IT industry having fallen into its kitty, Hyderabad surely has an advantage over Vishakhapatnam which is now being developed one step at a time. Till date the city of Vizag has only 57 startup ventures. However, CM Naidu intends to change this pretty soon.
Can Vizag be the New Fintech Capital?
Post a number of experiments, the AP government has decided to focus on one thing at a time, thereby shifting its focus to the most important ambition, which is to convert Vizag into a fintech capital of the country. It should be noted that Mumbai holds this title presently.
J A Chowdary, the IT Advisor of CM Naidu said that with the financial technology across the world displaying a growth of 26%, it seemed liked the best choice to focus upon. The government aims at converting the business capital of Vizag into a fintech capital.
During the event held in Vizag last month, the convergence of fintech stakeholders was seen. The government aims to realize its ambition with a fool proof plan. It intends to begin by creating man power. With this idea in mind, the state has signed MoUs with Visa, Thomson Reuters and HSBC to establish their financial technology academies in the academic institutes across the city. According to Mr. Chowdary, getting experienced and senior people from the industry into the city is the only way the government can expect to attract investors and establish a fintech ecosystem.
The state government is busy inviting fintech companies as well as startups, Paytm being one of them to set up their centers in Vishakhapatnam. Amit Sinha, the senior VP in Paytm said that their company appreciates the CM’s efforts to develop Vizag as a fintech hub by extending great facilities, infrastructure at par with the world standards and guidance to the organizations that are willing to set their offices in the city. With such an attitude, the city is sure to an industrial friendly one, quite similar to the metropolitan cities.
In order to extend further support to startups, the government intends to offer them use cases which will help them survive.
A Fintech Valley Conference was organized in Vizag last month by KPMG’s Fintech. The partner and head of this establishment, Neha Punater said that unlike Australia and Israel, the fintech in India is not confined to a single hub but is rather scattered. She thinks that in case Vizag establishes itself as a fintech, it can get connected with Mumbai virtually. However, there are others who think that this idea may not work. An expert said that he does not see the reason that why fintech companies would come to a small city, accessing which in itself is an issue. He thinks that with the world being virtually connected, this idea definitely seems a tad far fetched.
Professor Nageshwar Rao also has such concerns too and feels that though Chandrababu Naidu is a great leader, economic development is not just about leadership and policies. He thinks that connectivity and weather conditions too, play a crucial role in the development of a city. He further added that though making Vizag a fintech is a great idea, it would be wiser if AP focused on food processing, agricultural processing and logistics.
According to investor Sateesh Andra, in spite of the fact that the cities are moving on the right path, the development will surely take at least 5 to 10 years. Though Hyderabad is home to companies like Facebook, Google etc, it too has its fair share of problems which is keeping it from achieving the tag of fintech.
Though the governments of AP and Telangana are working hard to become the leaders in startup ecosystems, it is still unclear as to who will be the winner. While Hyderabad has an established infrastructure, AP is just beginning its work in Vizag. However, the CM has the reputation of bringing on full scale development at the snap of a finger which makes the realization of his dream a possibility.