Top 5 Challenges Creating Talent Crunch in India’s FinTech Industry
- Shailendra Marathe
- Oct 20
- 4 min read
India’s FinTech sector is surging. But here’s one problem that’s holding back the FinTechs: there simply aren’t enough skilled people to keep up with the growth possibilities.
India’s FinTech sector is surging. With over 10,200 startups, $28 billion in investments, and 26 unicorns powering everything from LendingTech and InsurTech to PayTech and WealthTech, India is undeniably a one of the global FinTech powerhouse.
The Talent Gap
Here’s one problem that’s holding back the FinTechs: there simply aren’t enough skilled people to keep up with the growth possibilities.
Despite the promise of disruption and innovation, many FinTechs are stuck in an all-too-familiar loop, across the talent management cycle, from hiring suitable talent, struggling to train it from scratch and retaining them once they are productive. Whether it’s about intensively training a management intern to become productive before the end of internship or ensuring that a backend developer does not turn into a “no show” case after offer, the gap between ambition and execution is widening.
Let’s Look at the top 5 challenges that are causing this talent crunch in Indian FinTech, and what founders and CHROs need to do about it.
1. The Specialized Skill Gap Is Getting Worse
India produces over a million engineers annually, yet FinTechs continue to complain that they can’t find the right people.
FinTechs don’t just need coders, they need full-stack engineers with FinTech-grade security knowledge, backend developers who understand API development and integration, data scientists who can also model credit risk and comply with regulation. These talents are hard to source.
65% of FinTechs say hiring for technical and product roles is their top talent hurdle.
AI/ML, blockchain, cybersecurity, and cloud-native developers are high in demand, but the supply is short.
As Subhash Menon, CHRO of Angel One, put it: “Domain expertise isn’t just a bonus anymore—it’s a necessity. We value people who can build at speed but also understand what’s at stake in financial services.”
FinTechs need talent which is skilled at both Finance and Technology.
2. Internships Are Misaligned and Unproductive
India’s student population is enormous, and the universities aim to provide millions of opportunities across sectors. FinTechs are eager to tap into this pool to manage costs and develop future talent pipeline, but the reality is far from expectations.
“Interns are unproductive. By the time they learn, they’re done. It slows us down.” Typical grouse of a FinTech founder in India.
On the other hand, interns also have their stories to share:
“They want 3 years’ experience in an internship. I was asked to manage DevOps pipelines on Day 2. Zero mentorship,” says a Computer Science student from Bengaluru.
The result? Internships become a burden for FinTechs and a disappointment for the students. Without structure, mentorship, and real-world exposure, the internship channel turns into a pain point for universities, students and FinTechs.
3. Attrition Is Breaking the Pipeline
According to Xpheno, India’s FinTech sector added 14,000 net new jobs in the past year alone but lost nearly 26% of its workforce due to attrition.
That’s one in four employees walking out, and most of them are early-career professionals in sales, customer service, and tech support. These are the very people FinTechs rely on to scale operations and deliver great customer experience.
38% of FinTechs report high churn among junior staff (Gitnux).
Replacements often lack training and take months to ramp up.
Hybrid work model helps hiring, but teamwork and cultural assimilation suffers. HR leaders admit it’s hard to build loyalty over Zoom.
4. Geographic Expansion Is Not Practiced Enough
FinTechs want to across the length and breadth of India with their products but are still hiring from metros.
While the Tier-2 and Tier-3 cities saw a 42% surge in IT/finance hiring in 2024—twice the rate of metros, most FinTechs continue to remain Bangalore-Mumbai-Delhi centric.
Only 24% of new jobs in tech last year were outside top-tier cities (as per LinkedIn India Trends).
Remote work opened doors, but few companies are ready with the strategy and support for this model. The universities are not able to ensure that the students have the professionalism to make the hybrid model work.
5. Uncertainties from AI and Automation Are Not Tackled Head-On
AI is the future, both an opportunity and a challenge in itself.
Founders in Indian FinTech predict 30–50% job loss in entry-level roles because of AI (Analytics India Magazine).
Even senior roles aren’t immune to redundancy, up to 30% may be automated in some companies.
This has created a paradox: teams are hiring AI skills while fearing AI layoffs.
“No one will lose their job due to technology alone. We'll retrain and redeploy,” said Nithin Kamath, Founder, Zerodha, who has a different take on the matter.
Most FinTechs haven’t articulated a clear plan to handle the AI storm. As a result, employees are wary, applicants are confused, and reskilling remains a buzzword rather than a reality.
What can the FinTechs do to resolve the challenges?
The challenges are real and growing in severity. So, what can be done to handle these?
Here are five moves FinTech leaders can consider, implement, calibrate and improvise:
1. Design real internships: Structured, mentored and project-based
2. Expand hiring zones: Hire from Tier-2/3 cities that are talent-rich and cost-effective
3. Upskill fast: Run AI, cybersecurity, and domain bootcamps internally to upskill
4. Build retention-first cultures: Develop career pathways and hybrid models
5. Plan for AI: Build re-skilling tracks, and not merely cut headcount
The solution: Take Talent Pipeline Development in your hands
India’s FinTech story is just beginning. The market is massive.
Look back to the 1990s and the beginning of the century, when ITS leaders like TCS and Infosys built partnerships to resolve talent shortages. Poaching talent will not be enough; it will drive up costs and reduce loyalty in general.
Get every step of your talent pipeline in order.
If you're a FinTech talent leader, university or a student, what challenges are you facing right now?
What specific skill are you planning to develop first to stay ahead of this transformation?
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