Advantage India
Growing
Demand
*India’s accounting and professional services market is expanding steadily, reflecting strong demand in the financial services sector. As per a Mordor Intelligence report (January 28, 2026), the market is estimated at Rs. 1.47 lakh crore (US$ 15.97 billion) in 2026 and projected to reach Rs. 1.82 lakh crore (US$ 19.66 billion) by 2031 (CAGR 4.25%), driven by stricter compliance norms and rising adoption of technology-led financial and advisory services.
*Rising income is driving the demand for financial services across income brackets.
*India’s financial services sector is projected to nearly double profits by FY30, led by NBFCs growing at 16% annually. Growth drivers include retail credit, wealth management, payments, and insurance.
Innovation
*On January 27, 2026, India’s financial services sector is witnessing strong innovation-led growth, driven by rapid digital adoption, AI, and fintech expansion. With over 14,500 fintech firms and robust digital infrastructure, the sector is becoming increasingly digital-first across banking, insurance, and wealth management, supporting higher efficiency and profitability outlook towards FY30.
*Government highlighted UPI-led digital payments revolution, advancing financial inclusion and digital banking.
Policy
Support
*On January 21, 2026, the Union Cabinet approved Rs. 5,000 crore (US$ 553.6 million) equity support to SIDBI to strengthen MSME financing. The move will enhance lending capacity, support around 102 lakh MSMEs by FY28, and expand access to affordable credit reinforcing policy support and growth in India’s financial services sector.
*FDI sectoral cap in the insurance sector has been revised from 49% to 74% under the automatic route. The Union Budget 2025-26 also announced the further increase of FDI sectoral cap for the insurance sector from 74% to 100%. This enhanced limit will be available for those companies, which invest the entire premium in India.
*Government highlights AI-driven financial policy support, strengthening inclusive, secure ecosystem.
Growing
Penetration
*India’s BFSI sector has expanded significantly, with market capitalisation rising 50-fold from Rs. 1.8 trillion (US$ 40.82 billion) in 2005 to Rs. 91 trillion (US$ 1.05 trillion) in 2025, as per a November 2025 report. Its GDP share increased from 6% to 27%, driven by growing financialisation and deeper penetration across retail investors, NBFCs, fintech, insurance, and mutual funds, particularly in smaller cities.
*Credit, insurance and investment penetration is rising in rural areas.
*HNWI participation is growing in the wealth management segment.
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