Money & Banking

Demonetisation is the ‘fintech moment for India’

K Giriprakash Bengaluru | Updated on January 16, 2018


Digitisation helps improve transparency, ability to tackle money laundering, says central bank of Singapore’s Sopnendu Mohanty

The the Monetary Authority of Singapore, the central bank of the city-state, recently created a fintech and innovation group and roped in Sopnendu Mohanty from Citibank to head the group. In an interview with BusinessLine, Mohanty shares his views about the demonetisation process in India and believes that the country should make use of the opportunity that this move has opened up. Excerpts:

How does the Monetary Authority of Singapore view India’s demonetisation exercise?

I can’t say much about the noises on the ground but from where I stand, I definitely see that it is one of the boldest moves from the Indian government.

Purely from a philosophical viewpoint, India is aspiring to become a cashless society. I do admit that being such a large country, implementation is a challenge. In the long run, moving to a digital currency or cashless operations is an answer to the growing need of the digital economy.

We see it as a very positive move. Demonetisation has set the ball rolling for India. I think things will start getting better for India. This is the fintech moment for India. If India can capitalise on this fintech moment, there is a huge opportunity for the country on how they play a role in the digital economy.

Apart from the implementation part of it, do you foresee any other challenges?

I don’t think there is a big challenge because once you move to a digital currency, transparency increases, and the ability to tackle money laundering and money flow will become easier. I do hear on the ground there are short-term challenges which can be overcome. But then this is the right thing to do.

Even though the US as well as Europe and even India earlier have gone through the demonetisation process, there is no precedent here because of the speed with which it got ushered in…

In hindsight, every one will have an opinion. I am sure political leadership and policy-makers took everything into consideration before taking a decision. It is hard to imagine for a country of 1.3 billion people able to do something differently.

The timing is perfect because the whole world has shifted to digital economy now and with Aadhaar and UPI (unified payment interface) in place, I don’t think the Indian government can find a better time than now.

Technology companies here are concerned about whether a country like the US under the new President will take a re-look at outsourcing. Do you see that happening?

From a fintech perspective, we are immune to the political narrative. But having said that, the world is far more connected when it comes to technology. When it comes to a good idea, there are no boundaries.

I am sure in the US, India, Singapore and the Asean, good ideas and good technology will be the most connected piece of asset people would always like to have.

I don’t see geographical barriers or any other differences coming in the way of the need to foster a much more global impact on moving good ideas and technology for the greater good. I do agree there will be some anxiety.

If, for example, fintech has to grow, the story has to shift from the West to the East. Instead of worrying about all the opportunities in the world, the opportunity lies here. There are about two billion people in this part of the world, including India and the Asean, which needs a lot of automation, digitisation and a lot of good technology. And if Indian companies can focus on that and solve that, there is a huge opportunity.

Is your institution looking at associating itself with any of the projects here?

We have an agreement on fintech with the Andhra Pradesh government. We are looking to partner with the Indian ecosystem next year. My biggest bet will be that both India and the Asean will be a big market for us to work with closely.

The talent is fabulous in this part of this world. With the kind of ideas that get generated, and the start-ups here, we can all build a far better ecosystem and India, by far, has the huge potential to take it forward.

Published on December 06, 2016

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