Takeaways from a Singapore-India FinTech event at Bangalore
I have to start with a disclaimer that I'm no expert in the area of FinTech. What I'm going to share here are some things I picked up at an event today where experts discussed FinTech in very specific terms. The event brought together the Monetary Authority of Singapore (MAS) and FinTech Valley Vizag, along with Bangalore start-ups and corporate delegates. MAS is partnering with the Andhra Pradesh government on a number of tech initiatives and FinTech is one of them. While Singapore is becoming the FinTech hub in Asia, Vizag is making bold moves to become the FinTech hub of India.
Three things stood out for me at the event:
- Beyond Payments
- Government Policy
- Skilled Manpower
Image source: Kumar, M., 2013, ‘Digital Privacy, Internet Surveillance, and The PRISM – Enemies of the Internet’, The Hacker News; Security in a Serious Way.
The world we have built around us is due to human ingenuity as well as engineering skills. Tools play an important role in this. It's not an exaggeration to say that most engineers think about the tools at their disposal before starting to give form to their ideas. To sculpt something, you need first good chisel and hammer. To build a bridge, you need precision measuring instruments. To dig a tunnel, you need a boring machine. In today's digital economy, you need connected servers, software platforms and algorithms.
Tools improve both efficiency and effectiveness. The problem with the use of tools is the intent. A knife can be used to cut fruit or to kill your neighbour. A cook and an arsonist use fire in very different ways. Now imagine what will happen when a powerful tool is created with bad intent but the public is told that it is for their good. Aadhaar seems to be in this category.
Payments made easy
It was in December 2016 that the BHIM app was launched by our Prime Minister. BHIM couldn't have asked for better timing. It came at the heels of demonetization when all of India was focusing on cashless payments. Cash was in short supply and alternative means of payments were in demand. About two months later, YourStory carried a story about 27-year old Nikhil Kumar who had apparently built the BHIM app in just three weeks. A few days ago Nikhil Kumar spoke at a small gathering of enthusiasts at Thought Factory, Bangalore. I attended mostly to know about UPI and BHIM but also partly out of curiosity to see the man behind the app.
I am yet to install the BHIM app on my smartphone. While I'm not a Luddite who stands against the advance and adoption of technology, I'm certainly not an early adopter. Since I know the engineering side of things, experience tells me that early releases are prone to contain bugs. Particularly in today's world of MVP releases and lean/agile processes, no one waits for a well-tested product. First releases will certainly contain problems when test-driven methodologies are not followed; or test automation has been sidelined due to more pressing delivery deadlines. So I haven't been using BHIM but I certainly wanted to know what it was.
An introduction and an opinion
Governments are typically not recognized as enablers of software creation. If at all e-governance is embraced, it's through tenders for which private entities will bid, deliver and maintain. Government departments are also notorious for being isolated from one another, which means that there's no possibility of sharing information, reusing code or coordinating actions. Systems operate in silos and often use different technologies. There's lack of standardization or guidelines for best practices. To solve some of these, the government has released OpenForge, a platform for developers to collaborate on open source software. The platform received coverage on news websites this week but it has been going through internal testing since last year.
Open source means that source code is open. Anyone can view the source code, file bug reports, improve the code and redistribute it. Of course, there are variations of this depending on the exact license that's used by the development team. For the moment, OpenForge does not seem to provide much information about what sort of license should be used.
JAM, UPI and related developments
Yesterday I had the chance to attend an event that focused on issues of demonetization, FinTech (Financial Technology) and digital payments. Held at Thought Factory, Bangalore, it featured speakers from Byte Academy and Nidhin George, a writer passionate about FinTech. While FinTech as a domain is well defined in the West, it's still nascent and evolving in India. There's been a lot of focus on payments but FinTech is much more: investment, lending, insurance, digital currency, and so on. This obviously means that opportunities for innovation are plenty and as yet untapped. Perhaps 2017 will be the year when FinTech really takes off in India, thanks in part to the recent demonetization that has given it a major push.
While the demonetization exercise of Nov-Dec 2016 is something that had high-profile coverage, the government has been building up the case for a digital and cashless economy more quietly for quite some time now. At least, the public and media ignore them because they didn't create an immediate impact like demonetization. In the Economic Survey of 2014-15, the government introduced JAM Trinity: Jan Dhan, Aadhaar and Mobile. Let's look at each of these briefly.
A personal wishlist for the unconnected Indians
The tussle between Facebook and the proponents of net neutrality has come to an end in favour of the latter but the debate will no doubt continue. We are also likely to see Facebook launch new initiatives. It's not going to give up so easily in a market that's young and growing. It's not my intention to repeat the two sides of the debate. I will merely point the reader to a couple of articles, which are listed at the end of this post.
But let's say that for argument's sake I'm a village guy who has never used the Internet. I just got hold of a Lava Iris X1 Atom S for about Rs. 3,500. It was hard-earned money but I have heard from friends that the investment is worth it. I take a pre-paid voice plan for occasional outgoing calls. I will use it mainly for incoming calls and missed calls. Indians are good at coming up with predefined protocols to know what each missed call means. If I can access data for free, what would I want? I have to make this choice because obviously not everything is going to be free all the time.
Event Highlights and Guidelines for Entrepreneurs
I was fortunate to be invited to the Start-up India, Stand-up India event last week at Delhi, where our Honourable Prime Minister Mr. Narendra Modi unveiled the government's action plan for India's start-ups. It was a fantastic event for young entrepreneurs and entrepreneurs like us, especially in terms of learning from other successful entrepreneurs who were present at the event. We listened to about 100 successful start-up founders and investors across the world. One complete day was filled with panel discussions and success stories from founders, investors and policy makers.
There were discussions on what qualities are required in entrepreneurs, what support is required from government, how to raise funds, what investors look for and how do we make India a global hub for developing entrepreneurs. The event was attended by Ministry of Commerce, Ministry of Finance, Secretaries of the Government, investors and entrepreneurs from Silicon Valley. Founders of successful Indian start-ups and about 2000 young entrepreneurs from many parts of India were present, making the event all the more exciting.
Revealing the Aesthetics of Data
What's the one thing that the world is producing more than anything else? Take a guess. No, it's not greenhouse gases even though they are up there as well. It's data. This is the Information Age where we are producing data in the order of exabytes and petabytes. If social networks are producing data on such scales, with the Internet of Things just around the corner, data generation is going to grow several orders of magnitude. It's so difficult to put a number in terms of bytes that sites often stop with content generated per minute: 4.2 million Facebook likes per minute, 110,000 Skype calls per minute, 600,000 Tinder swipes per minute ...
Data collection for its own end has no purpose. We need to process it, analyze it and derive insights from it. There's such a thing as being surrounded by too much data but that's only when you have no idea what to do with it. We are currently living in a situation where we have lots of data whose potential is as yet untapped. The time is therefore ripe for changes and innovation.