View from India: Digital India for the common man
It is hoped that digitisation will bring India close to some form of operational utopia. In the coming months, when all verticals go digital, these operations will become pervasive. E-payments and paperless transactions will ensure last-mile connectivity. This will create an all-inclusive India, which is key to economic prosperity.
Digital India will reach out to people living in the fringe areas and bank-less individuals like the self-employed, street vendors and farmers. A holistic approach is required in order to make Digital India a reality. Operations should become digitally viable and this can happen if sound infrastructure is backed by smart applications.
“Uber and Ola Taxi are examples of companies that have used building blocks like smartphones, GPS and Google Maps for their back-end support. Likewise, India Stack is a set of building blocks whose functions rely on the Aadhaar Card, which is a unique identification 12-digit number for all residents of India,” said Sharad Sharma, iSpirit Foundation, India Angel Network, speaking at the fifth edition of the CII Yi National Entrepreneurship Summit 2017.
Aadhaar is a data-driven biometric and retina scan-based system and national governance project. India Stack and Aadhaar will make operations paperless, cost-effective and almost error free. One of the most awaited outcomes is that of e-signatures becoming available for use across all industries for everyone, regardless of social status. Given this vast application, India is slated to evolve as the world’s largest user of e-signatures by December 2018. Once the digital signature is done, it will lock in the identity of that user.
One immediate implication of e-signatures is the Goods and Services Tax (GST) which will come into effect in the coming months. A single digitised toll system will make the logistics of transport simpler and effective. Simply put, goods manufactured in Karnataka that are sent to other states need not carry a physical manifestation as a proof.
However, certain challenges need to be met. When you put private data in the hands of the user, the architecture used to build the public platform allows other platforms to be built on it. Hence, the digital consent of the user is an essential safety-security parameter. A techno-legal approach is required.
Moving beyond digital consent, payment transactions have been tweaked. Take the case of the Unique Payment Interface (UPI). This is a friction-free payment system, which gives users the option of making payments through mobile phones, apps or banks. This new-age payment system can be accessed by people across the economic pyramid and it gives users more options when it comes to making purchases. “When it comes to buying books, you can buy chapter by chapter and consume news article by article,” explained Sharma, shedding some light on forthcoming purchasing trends in India.
Fin-tech companies should build finance products and services through which the merchant can accept payments. This is necessary because looking ahead most purchases will happen in the e-commerce world.
“The annual growth rate of the Indian e-commerce industry is 30 per cent and the country is among the world’s fastest growing Internet markets. As of now, around 200 million e-transactions have happened in India, either through the Internet or mobile. We are moving in the right direction, though there’s still a huge mass of 900 million people who have not done e-commerce transactions,” said Kris Gopalakrishanan, co-founder, Infosys Technologies Pvt. Ltd.
Infrastructure needs to be scaled up to meet the emerging digital needs and apps - including regional ones - should be built to deliver services. It is critical to tie up the loose ends and ensure that proven, tested, certified mechanisms are in place to assure people about their online transactions across verticals. Complexities and procedures in the value chain need to be reduced.
In the coming months and years, everyone will be expected to exchange money in a digital fashion. Thus, the next big wave will be related to the amount of data collected and any information and value derived from that data. Certainly the digital world is heralding a paradigm shift. It would be nice if this new order also created new jobs, as India offers a greenfield opportunity.