Deciphering bankruptcy risk in fintech firms: exploring key factors and implications

India is a credit-hungry country. Indian financial technology (fintech) companies have recently moved from offering only payment services into the lending space. They provide loans with fewer formalities and less paperwork, which attracts customers that have poor credit history, no income source, low credit scores, absent collateral security, etc. As digital lending has increased in recent years, so too has the risk of insolvency. Finding the variables that influence bankruptcy risk has become crucial for fintech companies to thrive in this cutthroat environment. This study investigates the variables influencing fintech companies’ bankruptcy risk using data gathered from the 2022 annual reports of 29 fintech companies in India, which is evaluated using a classical assumption test, a goodness-of-fit test and a multiple regression analysis. The findings indicate that business size is the factor that most influences bankruptcy risk, followed by the frequency of board meetings and the presence of a risk management committee.