Blockchain in India Opportunities and Challenges: The Vowel Model

By Shwetal Gajbhiye, FinTech Consultant

In spite of being the buzzword across the globe, blockchain continues to remain one of the unexploited sectors in India. With traditional pillars of FinTech continuing to dominate the industry; it is imperative to look at it as one of the important pillars of the Indian landscape. With hardly 4-5 start ups currently operating in India (such as Unocoin, Zebpay etc.), there are lot of opportunities for startups to exploit in this sector. The year 2015 saw a boost in the investment in blockchain from companies like TCS and Infosys. This move indicates a strong demand in this sector.

If one can think of contribution from blockchain in India, financial inclusion is the very first name that comes forward. Financial inclusion has been one of the priority sectors in India where blockchain can play a significant role. ICICI (Industrial Credit Investment Corporation of India) one of the largest private sector banks in India has already seen success in their financial inclusion program by having 1.8 million accounts opened with the help of this program. However, we are still yet to reach the customer to the last mile.

Blockchain can play an important role as one of the most secured online ledger not only for accounting but also for creating a legal transparency in trading high value goods such as gold or diamonds. In addition it also creates a secure framework for governance. In past, we have seen regulators in India seeking help for creating a secured framework.

It is also important to understand the cryptocurrency model to ensure a continuous innovation in banking and financial services industry. Hence, one of the important objectives for the major firms in India such as Cognizant, TCS and Infosys etc. is to educate their resources on this technology. Infosys has already made a move by having its principle architect attend a 2 week program to understand this technology, at Palo Alto based Blockchain University.

With these opportunities come challenges in this sector, a majority of the underbanked population in India belongs to the rural sector. Hence, the adoption of technology and creating a user awareness is very slow. Convincing an individual to adopt to the technology takes a lot of time.

Another important challenge that is faced is the way one looks at blockchain. It should be looked at as a technology rather than an unsecure framework. Also, currently there is no effective evaluation model available in India for blockchain.

To address these challenges I propose a vowel model: A E I O U
1. Aware
2. Educate
3. Innovate
4. Optimize
5. Untangle

Each step of the model is connected to the other and can be explained. Once you have created awareness this needs to be followed by educating people and resources on the technology which will eventually lead to innovation and optimized solution and this will finally untangle the complex underbanked market in India.


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