London-based fintech firm Revolut has announced it will officially launch its services in India next year. The announcement comes a month after a shares sale process valued the firm at $45 billion.

As one of Europe’s top fintech firms, Revolut provides a number of services, such as allowing customers to “hold 150+ currencies on a debit card, and send or spend money in local currencies around the world,” the firm says on i’s website.

One of its most attractive products could be the Indian Rupee Card. With it, customers can spend money in local (Indian) currency, saving them huge fees on exchange rates, ATM withdrawals and general card payments.

Revolut is the latest brand in the global fintech industry to announce a near-future launch in India. It follows similar initiatives by many other big names from the financial technology industry in recent years. But the reasons why Revolut has decided to operate in India are slightly different.

The bank’s Chief Executive for India, Paroma Chatterjee, told the Financial Times: “India is being treated as a critical expansion market.” And that shows India’s changing status in the global financial industry.

in other words, this is not just another ‘operating from India’ kind of a project. Instead, it’s an ‘operate in India’ initiative aimed at business expansion and capital growth.

We have read and heard enough about industry giants moving to India for cost-cutting reasons such cheap labour, easily available talent pool, lower operational costs and lower taxes. But moving to India to make money is less heard of, and it’s bold.

Does the business plan make sense?

In the world of business, population matters. And that’s one of India’s strengths. Last year it knocked China off the top of the list of the world’s most populous countries. India’s current headcount is more than 1.4 billion. That number will continue to increase for the next few decades at least, according to the UN’s Department for Economic and Social Affairs.

But it’s not just about the overall number. There are more specific details of India’s population demographics that might be attracting foreign investment. For example, around 50% of India’s population is under the age of 25. And here is another crucial stat. India is home to a fifth of the world’s youth population, according to some studies.

Over the past couple of decades the global fintech industry looked at this portion of the Indian population as potential workforce. It not only provided comparatively cheaper labour for global businesses operating out of India, but also served as an attractive talent pool for firms based in the US, Europe and elsewhere.

But Revolut seems to be looking at India’s youth as a potential market for business growth. It’s no secret that this younger chunk of the population around the world is increasingly falling in love with digital finance. And that’s exactly what Revolut offers in the form of digital wallets, multi-currency debit cards and its mobile app.

The IMF has put India’s GDP per capita at $2,730, which is clearly lower in comparison to some of the other markets Revolut is currently operating in. But the firm seems to be targeting the top 10-15% of India’s financial pyramid. And that in itself is a huge number of people.

Chief Executive Chatterjee told the Financial Times: “That’s the segment that also consumes Netflix, that consumes your Apple products … that travels and travels internationally as well, what I term the global India.”

India’s fintech ambitions matter too

India’s economy is one of the world’s largest, with serious ambitions to become a $10 trillion economy in the near future. Technology, especially digital finance, is at the forefront of this national plan. Projects such as India Stack are matters of national importance, and something the rest of us can learn from.

The government is initiating and supporting many other projects to enable India to become the torch bearer in fintech. The long-term ambition is clear. India wants its own Silicon Valley, on its own soil.

And there are some early signs of success too. Just last month, Manhattan Associates, a global supply chain commerce business, announced that the Indian city of Bengaluru had become its largest headquarter for selling supply chain software, overtaking its headquarters in Atlanta.

“The world is headed for some serious technological disruption with the advent of Gen AI. This requires a new kind of programming and problem-solving skill base to be developed.”

Shailendra Katyal, Lenovo’s MD for India

The company’s president and chief executive, Eddie Capel, told The Economic Times: “India has become a critical differentiating weapon for us in terms of the talent pool, the sophistication of the talent, the experience of the talent.”

This is one of many similar stories. Global fintech is migrating to India not just because it costs less to operate from the country, but also because the Indian population, especially the youth, can meet the ever-increasing demand for a skilled workforce for the industry.

The government’s fintech ambitions may show some hints of a policy change too. Instead of just exporting talent to the rest of the world, India is now increasingly keen on creating talent bases within its shores.

The fintech landscape is developing and changing globally. The future holds a number of opportunities but also some potential risks. Lenovo’s managing director for India, Shailedra Katyal sums it up well in an article for The Economic Times. “The world is headed for some serious technological disruption with the advent of Gen AI. This requires a new kind of programming and problem-solving skill base to be developed. Robotics and industrial automation are headed for a new dimension and AI will impact all spheres of life and productivity significantly.”

India wants to, and evidence shows it can, be that skills base that can deal with global AI disruptions and other fintech demands. It’s only natural for industry firms to have a base in the country. It’s the kind of party you don’t want to arrive late at.