Influence of Fintech industry on Sports Industry
- 17 July 2020 | 662 Views | By Abhinav Mishra
Financial Technology (FinTech) generally refers to a business that uses technology to enhance user experience with their financial transactions. Fintech has made inroads to the number of industries including financial and banking. In the last few years, the fintech has made inroads in the sports industry as well.
The rapid growth of the online sports industry is majorly driven by the vast availability of internet connectivity and the penetration of mobile gaming devices. Innovations in the fintech space also help improve the sector for game developers and players.
Global Mobile Gaming Statistics
The global mobile app sports market grew more than any other gaming type with an expected value of $72.3 billion in 2020. Tablets and mobiles have influenced the structure of many industries, from hospitality to retail, and gaming technology is no different.
In India as well in other parts of the world, a lot of sports are using fintech to provide better customer experience. All thanks to technology. As technology has advanced, the thrill and allure of playing games have only increased, with a more visual stimulus, satisfaction, and creativity.
What is Sport-Tech?
Sports tech is the intersection of sports and technology. When technology is used to create a solution to the realm of sports, it falls under sports tech. Let us take some examples to understand it better – the solutions that have changed the way athletes compete, solutions that help them improve their performance, or new ways of engaging sports, it is all sports tech. The sports tech has been around for years however, the term is new. Technology is the future of sports and hence sports tech is going to continue to grow and will become more relevant. As technology is evolving with time it is fuelling more solutions in sports.
Rise of Online games
According to a report by KPMG and India Federation of Sports Gaming (IFSG), there are about 20 million gamers in India right now, a gigantic jump from two million users of such games in 2016. With mass internet penetration fuelled by telecom companies offering data services at cheap rates, this number is expected to go up to 120 million by the end of 2020, as per the report.
Online games are now associated with almost all games starting from very popular cricket to kabaddi to poker. The frontrunner in the online fantasy sports is Dream11 which has over 51 million user base. Other than Dream 11, there are almost 70 fantasy sports operators at present. There were less than 10, three years ago.
Poker is yet another very popular sport in this space. The online poker industry has a lot to offer to the Indian ecosystem in the long term. There are several platforms offering poker games in India. There are at least 50 of them fully operational now.
How technology is changing in sports?
Before fintech got associated with sports, online games were entirely dependent on major payment systems, bank accounts, and credit cards. End users were never comfortable sharing the bank/card details on a gaming platform. Along with security concerns, it was relatively inconvenient and complex. With the introduction of payment services like Amazon Pay, G-Pay, PayTm, and many others, it has become easy to make purchases associated with games. The development of online wallets that can be linked to bank accounts has been the game-changer.
How has technology made sports safer?
As of 2017, there are approximately 2 billion people playing games online of which 27 percent were under the age of 18. Needless to say, teens are not completely aware of the issues online gaming brings with it. When it comes to online gaming there are a lot of risks involved like privacy and safety risks as well as a financial risk. Though a lot of frauds are still happening around the online sports industry, the numbers have reduced a lot because of the advancement of technology. The accounts are more secure now and hacking an account is not an easy task now. With the coming of fintech companies in the sports, the platform ensures more safety since safety is one of the primary parameters for fintech.
What is the future of sports?
With little to no actual sports due to the global pandemic, online gaming is thriving as we get into the second half of 2020.
Just watching the game is an old story now. Viewers like to get more involved with the game now. The best way to go is to play it. The smartphone users are increasing every year along with internet users, this ensures the gaming industry is not going anywhere shortly.
It is not only a source of entertainment and thrill but also provides a platform to make money. Fantasy sports are a great example of it. They engage the users, give them the excitement of feeling the critical moments, and the well-researched ones make money in the end. The fintech has ensured the transactions are a lot faster and secure. All the factors combined, online games are here to stay.
If you look at previous years’ stats, the gaming sphere will grow. And we mean dramatically grow! Despite being one of the largest countries in the world, India has a lot of room for growth in the gaming field. And as we welcome more and more technological advancements, digitalized gaming will become more pronounced in the local market.
What will be the most popular sport in the future?
Cricket has been the most popular sport in India for ages now. Any online game around it will always have an advantage. However, the choices that Indian users have now is an essential aspect of gaming in India. A growing number of game developers across the world from various fields are now developing games keeping Indian users in mind.
This means a plethora of genres for Indian gamers – from action games and VR to online casino games. That means Indian players will have a wide choice of games to pick online in the future.
The gaming choice expansion has already affected the traditional gaming activity of the local players. For instance, more and more Teen Patti and Rummy titles are emerging on the market, which is essential for gamers. Indians are passionate about both these games. When it comes to Teen Patti, Indian players can now play this extremely popular game even across numerous online casinos that have live dealers. Based on the numbers of growth and popularity in recent times, this could be the most popular game in India in the future.
What is the purpose of technology in sport?
Compared to the old video games people played 15, or even more years ago, modern games are quite different and a lot advanced. The gaming industry has improved thanks to the new technology, making more people involved in playing. It is only because of the advancement in technology the user experience and graphics are getting better every year. Secondly, the ease of playing games has also increased with technology joining hands with the gaming world. If the industry has to grow, more technology and fintech companies need to join hands with the gaming industry.
In the current scenario, a lot of people are spending increased time on online gaming. TV audience measurement body, Broadcast Audience Research Council (BARC), in its weekly report on April 16 highlighted that gaming had witnessed a 39% increase in the fourth week since lockdown as compared to the pre-COVID-19 period.
As a result, a lot of fintech companies are getting into this space like Paytm. Paytm First Games which was started to cash in on the gaming industry claims to be experiencing a surge in daily active users. The platform has claimed that over 1 lakh people are joining it every day. Platforms such as Paytm has the advantage of the existing user base and secondly, being fintech makes users experience seamless.
“There is a huge potential for gaming to grow in India”, Mukesh Ambani, chairman of Reliance Industries Ltd., said while speaking with Microsoft Chief Executive Officer Satya Nadella in Mumbai in their recent conversation. “Gaming will be bigger than music, movies, and television shows put together.”