The Exchanges

Q A couple of important points here. So do our regulators, you know, have built a playbook on their learnings from Aadhaar, UPI, that how does the regulator have to work?

A So in FinTech, the, the, the, if I take you back to, uh, Mr. Aguram Rajin's time, there was a regulatory approach that had, uh, been worked out, which was that we'll have a three lane system, right? Uh, there'll be digital public infrastructure, which is things like India stack was, uh, the name that we use then, uh, then there'll be regulated entities and there'll be unregulated entities and UPI, for example, you have had Um, Google Pay, Phone Pay and others in the unregulated lane. And then you have banks in the regulated lane. And then of course there is the protocol and the switch, which is part of DPI. Now that system was supposed to be applied to everything else. Uh, in fact, there's a beautiful, uh, BIS Bank of International Settlements paper, uh, which kind of captures this thinking very cohesively. But it has not been followed. And part of our pain in the, in the fintech system is that neither the fintechs nor the banks, unregulated, regulated, and the regulator have remained true to this three lane model while everybody says this is the right model. So either we should come out and say, this is not the right model. And we're going to have an alternative. Or, you know, we must follow it diligently. And we haven't done that. And we have not done that partly because as things change, on the regulatory side, the institutional memory is not kept up as much as it should. It…

AI assessment note: “there was a regulatory approach that had, uh, been worked out”

Q Can you explain the full form of MOSIP, DEPA, and a few other terms?

A So MOSIP is modular. Uh, so MOSIP actually is an effort to take Foundational ID. So the, so the ID idea here is that there is almost like an ID chain, right? And the ID chain is that if I go to IRCTC site or I go to Digi Yatra, I originally identify myself with an identification that already exists. So we call that the foundational ID in India. That's the best way to do that is through Aadhaar. But subsequently, once you've identified me as Sharad, then the, ID system that, that Digiatra has or a bank has or IRCTC has can be their own. That's called federated ID, right? So, so I can have many, many IDs in the system. Each one of it authenticated with a foundational ID. So that's like a chain that we are talking about. So MOSIP is a foundational ID system for the rest of the world. Uh, and why does it exist is because One of the promises that we make in MOSIP is that it is non-weaponizable. So if you implement the MOSIP system in your country, there is no backdoor that India will have that will allow India to control that system as you go forward. And, and since identity is so mission critical, people demand that, right? And, uh, and since we address that very carefully, uh, in MOSIP, it travels. So when you do UPI, they want the same approach. Right. And so they say, okay, we'll use your payment system, but we don't want that you have some backdoor kind of strings that you can …

AI assessment note: “So MOSIP is modular. Uh, so MOSIP actually is an effort to take Foundational ID.”

Q Last time we discussed the India stack is power. So in the last one and a half year, how has India stack gone global? You know, some of the ideas like digital primitive for flow of people, money, information is now better recognized outside India in low income, middle income, and high income countries.

A Right. So if you take us, you know, if I take you back to, uh, you know, at that time, uh, the thinking was that we need to introduce three more Primitives, uh, in this world of digital, the three primitives that existed, uh, which is, uh, really flow of packets, which is TCP IP flow of messages, which is SMTP. That's how our email systems are based and flow of content, which is HTTP. Uh, then that's how web content is shared. You know, uh, they were very useful, but they are not central to a digital transaction. So for example, let's say, you know, I have to go to Chennai, uh, and I want to go by train, uh, then I would need to identify to whichever booking application I'm using. Who am I?

AI assessment note: “the thinking was that we need to introduce three more Primitives”

Q So, you know, want to discuss a few things, right? Why China is so better than us in doing the Darwinian ecosystem, right?

A Even before that, let me pick something else before that. I think, you know, as we, you know, one of the things that I like to talk about is that, uh, is about ease of doing business because we have to fix it. It's a basic, it's table stakes. You know, I know, uh, I was in Vietnam, January ended up being a very busy travel month for me, but I was there for a few days. Uh, and we are actually going to do a citizens stack conference in Vietnam on May ninth and 10th. And, uh, and you know, while I was there, there was all this buzz that was taking place about, uh, uh, this Elon Musk department, Dodge that is there. And, uh, And I came back and next week they announced a 20% cut in the number of people involved in regulation so that they can be competitive, you know, with the rest of the world. Now, the point is that in ease of doing business, if anything is relative in nature, it is that, right? And in today's world, if we don't fix this, uh, you know, We will lose talent, uh, and companies to outside. You know, you know this even better than I do. Probably 50 of our 120 unicorns are technically not Indian, right? And, uh, now the reason is that there's been an effort to fix them, fix the problems in something called stay in India checklist. For, for the past so many years, you know, the stay in India checklist came to being in October of 2015. Few months before the startup policy…

AI assessment note: “Even before that, let me pick something else before that.”