Role of ease of business, VUCA as the future of fintech unfolds

At the second event at Razorpay FTX 2020 on Friday, which the company uses to announce new product launches and facilitate discussions among key stakeholders in the fintech space on an annual basis, the company’s chief innovation officer Amitabh Tewary moderated a panel discussion to discuss the future of fintech.

If there is one thing that the panelists -- Mastercard Asia Pacific co-president Ari Sarker, Salesforce India chairman and CEO Arundhati Bhattacharya, Coinbase chief product officer Surojit Chatterjee, and NPCI managing director and CEO Dilip Asbe -- agreed on, it is that the future of fintech in India will truly show change of magnitude in over 20 to 30 years as opposed to just 10.

The panelists discussed various factors that will help India accelerate to such a future.

“Whatever is the GDP of a country, you multiply that by four to five times because remember, cash has velocity -- that is the volume of payment throughput which that market will generate. There might be a reset after Covid. But let's assume India is a $8 trillion economy by 2030. At 8 trillion, the opportunity for payments for full digitization should be flows of 40 trillion… I don't believe we are solving that in 10 years,” Sarker said.

Sarker added that ease of business in the country in terms of financial fluidity are yet to arrive at complete fruition. “We’ve got a really vibrant ecosystem of companies, but we really have to unleash the potential of these players, because the rest of the world and rest of Asia is also catching up, and they're gonna move faster, they'll make rules simpler, I think we need to make sure our entrepreneurs are able to focus on clients and customers, and rules cannot be developed for that 1% that is going to be the crooks in the system, and therefore everybody else pays the price for a convoluted system,” he said.

Bhattacharya, the former chairperson of the State Bank of India, said that traditional banks and new-age fintech providers are ideal partners since each makes for what another lacks. “On the one hand, fintechs have the agility to innovate very quickly and put products out in the market. What they don't have is customer connect, which again, the banks have. Banks bring their customer base, and the associated trust,” he added.

In a reference to a VUCA world, Bhattacharya added that there are uncertainties beyond the current pandemic that could hamper the current growth mechanism in the fintech industry.

“It's not only a question of connectivity, we are looking at a world that's very, very uncertain. We will be looking at very many scenarios as to how you build in redundancies so that we reach things that are totally central to a person's being, such as non-interrupted connectivity. Big use of data, both on the personal and on the corporate front,  hyper personalization, work on security, both cyber and physical security is important for a changing world,” she said.

VUCA is an acronym -- first used in 1987, drawing on the leadership theories of Warren Bennis and Burt Nanus -- to describe or to reflect on the volatility, uncertainty, complexity and ambiguity of existence, or any general situations.