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PAGE 1 | GRACE HOPPER CELEBRATION INDIA (GHCI) 19 Presented by AnitaB.org and Association for Computing Machinery India (ACM) India #GHCI19
India StackImpact of Population Scale Digital Infrastructure
Dr. Vivek Raghavan, Volunteer ISpirt
Back in 2008…
Diversion and leakage was common
~$50 Bwas spent on direct subsidy
Source : A Demirgüç-Kunt, L Klapper, D Singer, S Ansar, and J Hess, “The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution”, World Bank, 2017 2
Back in 2008…
Financial exclusion was common
17%had bank accounts
Source : A Demirgüç-Kunt, L Klapper, D Singer, S Ansar, and J Hess, “The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution”, World Bank, 2017 3
No Credible Data
Servicing Cost
Sales CostCustomers with
the lowest default rates
have the highest interest rates
For the poor, getting a loan is impossible
4
0.5% commission & Rs.1500 KYC
cost makes investment to
Rs.3L minimum!
Same goes for access to banking and mutual funds
Lack of Papers
KYC Cost
Sales Cost
5
Affects access to skilling and differentiated wages
Lack of portability
Low trust
Expensive ₹Lack of
verifiability and portability of job
credentials makes it a low
performing ecosystem
6
India now runs the world's largest direct cash transfer program
Savings to the tune of $5 Billion as per Govt estimates
>$32 Bnow directly being sent to bank account of the beneficiary
Source: https://www.thehindubusinessline.com/economy/dbt-in-9-months-of-fy19-exceeds-total-of-last-fiscal/article25883568.ece
430+ schemes
647 MillionUnique Aadhaar holders have linked their bank accounts
8
India would have taken 46 years to achieve financial inclusion
2011 fitted line
Source : A Demirgüç-Kunt, L Klapper, D Singer, S Ansar, and J Hess, “The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution”, World Bank, 2017 9
46 years
Source : BIS Analysis
India, 2011
But India only took 6 years!!!
2011 fitted line
Source : A Demirgüç-Kunt, L Klapper, D Singer, S Ansar, and J Hess, “The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution”, World Bank, 2017 10
46 years
Source : BIS Analysis
India, 2018
6 years
India, 2011
This acceleration was due to 3 things
11
World's largest financial inclusion and Digital India
program driven by PM
Innovation friendly regulators and Govt departments
supporting market making
A set of foundational public digital
infrastructure services
Political Will
Proactive Govt and
Regulators
India's Digital Infra
Open Digital Infrastructureas a means to build
decentralized, interoperable, building blocksto unleash inclusive innovation
12
Build Platforms not Pipes
The old way of innovating was to build end-to-end solutions
In the digital world, the method of innovation are through open protocols and platforms.
13
India's Public Digital InfrastructureA set of foundational digital infrastructure services
14
ENABLE
ENGAGE
EMPOWER
Identity Infrastructure
Transaction infrastructure
Data infrastructure
3 Biometric Data Points
1234 5678 9012Aadhaar number
4 Demographic Data Points
Aadhaar - A unique identity for every resident1 Billion digital IDs in 5.5 yrs
15
FoundationalMinimalUnique
Lifetime
Innovation through Open APIs
ELIMINATESPHYSICAL PRESENCE
Are you who you claim to be?
ONLY a yes/no answer
Anytime anywhere
ELIMINATES PAPER BASED KYC
ONLY done with authentication
No more fake documents
Anytime anywhere
Authentication API
Electronic KYC API
16
17
ENABLE
ENGAGE
EMPOWER
Aadhaar, Auth, & eKYC
1.3 BnAadhaar IDs issued
58 BnAadhaar authentications
9+ Bn e-KYC transactions
647 M Aadhaar enabled accounts
PMJDY: Bank account for allNo frill savings account
1 in 25 had ID in 2008$1 per ID, 1 Bn in <7 years
Paperless and instantUsed beyond banking
Inclusive, multi-channelAbout 1 Bn a month
2010
Identity Infrastructure
Aadhaar adoption paves way for the largest increase in financial accounts across 140 countries
20172011Income gap
14 5
Education gap 29 10
Closing the gaps on marginalized groups
35 % with account 80
Gender gap17
6
Employment gap 18 9
Source : A Demirgüç-Kunt, L Klapper, D Singer, S Ansar, and J Hess, “The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution”, World Bank, 2017 18
Application Service Provider (ASP)
One time KYC
eSign Service Providers (ESP)
AadhaarPAN
...
Residents needing to sign a document
Source: http://cca.gov.in/esign
eSignOpen protocol for digital signature
19
UPI: Any stored value, any app, any device, any currencyAn open protocol for instant money movement
Virtual Addressing layer @ No need to disclose account information.
Allows account portability, enhances privacy
Mobile First 2FATo leverage the increasing proliferation of mobile phones for low cost, onboardingat scale and secure authentication
Push & Pull PaymentsAnyone can send or request money
from any user
Universally InteroperableAnyone with a bank or mobile money account can send money to any other account in India!
Source: https://npci.org.in 20
UPI transactions have overtaken credit and debit card payments
Source : Retail Payment Statistics on NPCI Platformshttps://www.npci.org.in/statistics 21
1.3 Bn
Transaction Infrastructure
ENABLE
ENGAGE
EMPOWER
Aadhaar, PAN,& eKYC
eSign, APB, AEPS, UPI, BBPS, GST
1 Bne-Invoices in GST system
1.3 BnUPI Transactions a month
$32.4 BnDirect Benefit Transfer
$20 Bn transacted per monthCards are at 250 Mn
G2P payment$15 Bn in savings
10M tax payersLargest unified tax reform
200 mn Micro-ATM transactions
Inclusive banking at doorstepInteroperable, ecosystem driven
2010
2015
22
Machine-readable documents
Digitally protected
2.3 Bn documentsissued
Source: https://digilocker.gov.in
DigilockerIssuer Requestor
Users
Issues Documents
Digitally
Accesses Documents
Online
Approves Access
No Physical Papers No Fake Documents
Digital LockerOpen protocol for distributed credential sharing
23
A byproduct of these platforms is the creation of public as well as private data
Digital Identity
Paperless Process
Commerce
Payment
Social
Machine Learning & Algorithms
We need to think about how this data wealth will translate to real wealth for users
24
0 0
0 1 0
1
0 0
0 1 0
1
0 0 0
1 0 1
Data Empowerment and Protection Architecture (DEPA)
India is implementing DEPA across
multiple domains through
interoperable protocols,
digital infrastructure,
& and electronic consent managers
25
The Account Aggregator will facilitate consented sharing of financial information in real-time
Bank
Mutual Fund House
Insurance Provider
Tax / GST Platform
Flow-Based Credit
Personal Finance Management
Wealth Management
Robo Advisors
Financial Information Providers Financial Information Users
Financial Data Access
Fiduciary(NBFC Account
Aggregator)
Request for Data
Consent to Share
Encrypted Data Flow
E2E Encrypted Data Flowbased on User Consent
Data Access Notifications
Consent to share data
Request for Data
Electronic Consent Artefact
Source: https://api.rebit.org.in/ 26
Health Data Fiduciary
Hospital
Lab
Health Apps
Hospital
Hospital
Doctor / Specialist
Insurance Provider
Personal Health Apps
Health Information Providers Health Information Users
PHR Network is Soon Becoming a Reality
Request for Data
Consent to Share
Encrypted Data Flow
27
28
ENABLE
ENGAGE
EMPOWER
Aadhaar, PAN,& eKYC
eSign, APB, AEPS, UPI, BBPS, GST
e-Documents, e-credentials, DEPA, AA
?New Innovation
15 MnDigital Locker Users
3 BnMachine verifiable Docs
Active online locker usersSchool certificates, Driver Licenses, and other credentials
1000's of contextualizedData driven innovation
400+ Fintech Startups
Thriving innovation ecosystem
2010
2015
2018
Data Infrastructure
Architectural PrinciplesKey Principles while building nation scale systems
29
● Build platforms not monolithic applications● Unbundle applications into many micro services● Adopt open standards and open source● Use commodity and heterogeneous computing● Interoperability through open specifications● Privacy and Security by Design● Trust by design through registries, signatures and attestations● Scalability by design● Observability through telemetry● Failure resilience and isolation by design
Cloud Computing, Smartphones
Internet, GPS, Maps Open Protocols
Information Discovery
Knowledge Democratization
Government Services
Social Networking
e-Commerce
e-Learning
UrbanMobility
One Internet, many applications
Internet Infrastructure30
One INDIA STACK, many innovative & inclusive solutions
DEPA, AADigital Locker UPI, AEPS, APB
Aadhaar, eKYC, eSignDirect Benefit Transfer
Jan DhanFinancial inclusion
Health Insurance
FasterPayments
Skilling & Education
Digital Lending
Tax Reform
India Stack Infrastructure31
India is laying digital infrastructure across domains with individuals and small businesses at the center
Bharat Bill Payment System
Goods & Services Tax Network
DIKSHA
National Health Stack
Digital Sky
Electronic Toll Collection - FasTag
Aadhaar, JAM, India Stack 32
Friction ReductionReduces cost of doing
business, and expands markets
Access to learning
Access to healthcare
Access to products & services
Increased TrustDigital & portable
attestations, verifiable claims
ComplianceMake it easier to comply
through automation
… and thus, accelerating formalization
33
34
The old way of innovating was to build end-to-end solutions
In the digital world, the method of innovation is via shared infrastructure
India's technology advancement has left even Silicon Valley standing. India has built the world's first national digital infrastructure, leaping at least two generations of financial technologies and has built something at least as important as the railroad was to the UK or the interstate highways was to the US.
Distributing the ability to solve!
- Leading Macro Investor
34