In an interaction with Adlin Pertishya Jebaraj, correspondent at Finance Outlook, Arpit Jain, Joint Managing Director, Arihant Capital Markets, shares that the Indian economy is transforming into fintech due to the robust digital infrastructure and mobile-first audience and systems such as Account Aggregator that allow people to access finances smoothly based on the data. He notes that despite the increased market engagement by fintech platforms, retail investors still encounter barriers of overload of information, insufficient availability to sophisticated analytics, and biased behaviour based on social media trends.
Arpit Jain is a finance expert who has a decade of experience in capital market, investment banking, institutional broking, and fintech. His leadership can be characterized by progressive vision aimed at using technology to make investing more democratic and scalable and client-oriented in delivering financial solutions.
What structural changes in India’s financial ecosystem have accelerated the adoption of fintech driven investment platforms?
It is largely driven by three structural tailwinds. India’s digital public infrastructure like the UPI, Aadhar and interoperable data rails has significantly reduced onboarding friction. With Aadhar covering almost the entire population and enabling instant eKYC, fintech platforms are able to onboard users quicker, at low costs and w/o much paperwork.
Secondly, India’s young smartphone-first generation has expanded the addressable market for these fintech firms. A young population that already uses UPI and mobile apps for payments is naturally comfortable using app-based platforms for investing.
Thirdly, the Account Aggregator framework, it helps to expand fintech lending and investment ecosystems by enabling consent based financial data sharing. Through standardized APIs, fintech platforms are able to access verified financial information in real time, helping them assess risk faster and design products for customers who previously lacked formal credit histories, such as gig workers and small entrepreneurs.
The influx of education through social media on how to invest has accelerated the adoption of investment platforms for novice and beginners.
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What are the major challenges investors face today in identifying undervalued assets in an increasingly data driven market?
One major challenge that immediately comes to my mind is information asymmetry and advanced tools that remain inaccessible to retail clients. Modern asset pricing increasingly relies on advanced analytics such as machine learning, large datasets, and quantitative models.
These models allow institutions and investors with sophisticated tools to analyze massive datasets like financial statements, price movements, macro indicators, and alternative data simultaneously. It can detect subtle pricing patterns or anomalies much faster than traditional methods such as simple ratio analysis (P/E, P/B). The retail investors relying on manual screening or basic tools hence miss early signals of undervaluation and cannot exploit the opportunities like large institutions.
Additionally, information is overload and limited analytical capacity. Investors today have access to massive amounts of data like earnings reports, macro indicators, social media analysis, heat maps and news but more often than not they lack the financial acumen to interpret all that information. That’s when FOMO driven or sentiment driven trading happens. They end up buying assets when prices have already peaked which undermines the proposition of value investing.
Behavioral biases have always been one of the biggest obstacles for retail investors, and the rise of social media has further amplified it. Investors often fall trap to herd mentality - investing in companies that have already priced in growth and are already overvalued and participate in momentum-driven rallies.
In what ways are fintech platforms helping retail investors move away from short-term speculation toward long-term value based investing?
Many wealthtech apps now nudge users toward systematic or goal-based investing, encouraging regular contributions instead of trying to time the market. Platforms are moving beyond basic SIP offerings. Features like portfolio analytics, AI-driven rebalancing, and return optimization tools help investors manage diversified portfolios and stay invested through market cycles rather than making frequent speculative trades. AI is evolving from simple chatbots to personalised advisory tools, guiding portfolio decisions and helping investors make more informed, long-term investment choices. Investing products such as PMS, AIFs, structured products, and risk-hedging instruments, are gaining traction too.
A lot of young investors jumped into options trading and day trading to make quick buck post-Covid bull run. They are now realising that making money in the markets requires skill and understanding, which most of the platforms don't provide. Gamifying trading and simplifying complicated products like options trading resulted in influx of lot of new investors, but now they are feeling the heat. At ArihantPlus, we are building AI-driven portfolio analysis tool to help investors make better investing decisions for creating long-term wealth.
It is important to offer responsible solutions and educate investors about the risk associated with investing and trading.
What financial risks should investors be aware of when relying heavily on automated investment tools and fintech platforms?
Most of the fintech platforms do not offer research tools, or guidance on stock picking. This gap exists because building meaningful research tools is expensive. Regulation also plays a role here. You require advisory licensing. At the same time, their business models are typically tied to transaction volume and not quality of investment decisions.
Now, since 2020 we’ve witnessed a sharp jump in retail participation in the stock market. Fintech platforms have made it easier than ever to participate in the markets with their low cost, frictionless, gamified interfaces. The problem is, when investing feels effortless, many new investors tend to underestimate the skill involved in making the right investments.
During the bull run, the rising market can create the illusion that making money in the market is easy. But markets do not move in one direction forever. This is why it's important for investors to assess their knowledge and skill before picking individual stocks. If someone doesn’t have the required expertise, it is best to invest through diversified products like the ETF or mutual funds. These vehicles are professionally managed and best suited for investors who want the market exposure without the responsibility of selecting individual stocks.
To solve this problem, at ArihantPlus, we are building tools like have curated stock baskets, ‘Themes’ and actionable research from SEBI-registered analysts, designed to support such retail investors looking for a more structured investment approach. AI-backed research tools are next in-line. But an investor needs to know what the AI-backed is by to ensure they are getting the right analysis and advice.
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Looking ahead, how will the convergence of fintech innovation and value investing reshape India’s wealth management landscape?
Looking ahead, the convergence of fintech innovation and value investing is set to reshape India’s wealth management landscape by democratizing both access to data and investment strategies. Fintech tools have significantly lowered the cost of research, giving retail investors access to analytics, screening tools, and alternative data that were once limited to institutional investors. This shifts the edge in value investing from information access to behavioural discipline and interpretation of data.
At the same time, platforms such as curated portfolios and model strategies are creating a new middle layer between passive mutual funds and high-ticket PMS/AIF products, allowing mass affluent investors to adopt structured, value oriented strategies at lower entry thresholds. As digital platforms scale distribution, the traditional wealth pyramid is compressing, bringing institutional-style investing frameworks closer to retail investors.
