Nirmala Sitharaman urges fintechs to tap rural markets, strengthen cybersecurity

Finance Minister Nirmala Sitharaman on Wednesday urged the fintech industry to shift its focus beyond urban markets and lead the next wave of innovation in rural and agricultural sectors, calling it both a business opportunity and a developmental imperative.

Speaking at the Digital Payments Awards 2025, Sitharaman called for a sharper push to integrate micro, small, and medium enterprises (MSMEs) with account aggregator framework and emphasized the need for tailored financial products for farmers and rural consumers.

“Every fintech firm should view rural India as a fertile ground, not just as a social responsibility, but as an opportunity to create new markets,” she said, adding that consumer demand in rural areas has shown strong and sustained revival.

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Drawing parallels with the fast-moving consumer goods sector, the minister highlighted how deep rural penetration has become a core growth strategy for many leading brands, a model she said fintech should replicate.

Sitharaman also flagged key risks looming over India’s expanding digital economy, urging startups and payment firms to invest more aggressively in digital literacy and cybersecurity.

“Literacy has to be improved upon. Cybersecurity is a case in which I had interaction with a few startups and fintech companies,” she said, warning against growing threats such as deepfakes and digital fraud.

“We need a set of fintech companies which are constantly working on giving solutions for the newer challenges which are arising,” she added.

The minister recounted recent discussions with startups and fintech leaders, underlining the importance of ensuring that ordinary users are not “digitally arrested at home” by malicious actors or deceptive platforms.

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Next phase

Financial services secretary M. Nagaraju outlined the next phase of India’s digital payments journey, stressing the need to deepen adoption across sectors and geographies, particularly in underserved regions.

“Our priorities must include deepening digital payment adoption across sectors and geographies,” Nagaraj said at the event.

At the same time, we must strengthen cybersecurity and fraud prevention framework, and promote digital and financial literacy at the grassroots, he added.

The remarks come as India’s UPI-led digital payments infrastructure, hailed globally for its scale and efficiency, enters a new chapter of expansion, pushing beyond urban centres and into rural economies.

In March 2024, the Union cabinet approved a ₹1,500 crore incentive scheme to promote small-ticket transactions on the BHIM-UPI platform, particularly among small merchants to spur usage in semi-urban and rural India, by expanding infrastructure through tools such as UPI 123PAY for feature phones.

It has also rolled out newer solutions like UPI Lite and LiteX for faster and more reliable payments in low-connectivity environments.

Lauding the role of digital companies in the cashless transition, Nagaraj said their contributions were about more than just facilitating transactions.

“Your work is not just about enabling payments, it is about enabling possibilities,” he said.

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“You are helping build a financial system that is more modern, inclusive, and globally admired," he added.

In recent years, India has emerged as a global leader in digital payments, with monthly UPI transactions crossing 14 billion in 2025.

However, challenges remain, particularly around digital literacy, user safety, and ecosystem resilience.