Book Review: Fintech for Billions - Simple, Human, Ubiquitous
Authors: Bhagwan Chowdhry & Anas Ahmed
Publisher: Penguin Random House India
In this chapter of TypeRight Osama Manzar brings out all his experience with communities through hundreds of projects under Digital Empowerment Foundation, and relates them to social and behavioural norms of the people as necessary ecosystem to make a tech intervention ubiquitous.
I beg to disagree with the title of this book by Bhagwan Chowdhry and Anas Ahmed. The name of the book Fintech for Billions should have been “Fintech is not for Billions” or “Tech is not for Billions”. Let me explain why-
In the late 1990s, I used to buy a magazine called Wired. It was a fascinating magazine that used to talk about how tech is used, adapted, and how it impacts various aspects of human lives. The design and layout of the magazine were masterclasses in the visual display of words, concepts, stories, and graphics.
I gathered the courage to write to its founding editor, Kevin Kelly, for an interview and got a positive reply. One of my questions was, “What is the future of technology?” He replied, “The future of technology is biology.” This actually means that if the technology has to become functional, adaptive and ubiquitous, it should become immersive with socio-behavioural norms, so much so that it starts becoming reflective of the human-machine and its biological system.
For the past decade, in particular, we expected digital and technological solutions to be adopted by the masses for doing their day-to-day financial work through mobiles, apps, calls, internet, messages, IVR, touch screens, machine voices, and the likes. But we were disappointed that people were not adopting them. Why are people not doing online transactions? Why are people not paying online? Why are people not selling online? Why are people not receiving and sending money among their peers and trusted relationships? Why are people not managing their money online? Why do people not trust digital and online systems for their money? -among other questions.
As per one statistic, in early 2024, 350 million people in India were recorded to have done online payments or transactions, out of the total Internet users of 840 million. However, only 122 million of those who transacted online were from rural India, where the total population of the residents s over 908 million. While 99% of all transactions were recorded on UPI, 45% of the recorded transactions were conducted by only 6% of the people. This means only 21 million people in India are using online mode of transactions in a ubiquitous manner.
And that is the reason why we all must read this book “Fintech for Billions” by Bhagwan and Anas. It is meticulously researched, almost to the level of an anthropological study; it describes socio-behavioural reasons for being unable to adopt various online methods of our financial practices. The book explains, with examples, how people deal with money and how people have traditionally been earning and saving. Where they save, and how they spend. What the priorities for spending for the rural masses are, and what the major reasons for people to take loans are. It explains why people take loans from money lenders and not from the well-trusted banks and financial institutions. It addresses the role of trust in financial practices and behaviours. It analyses the role of literacy, language, and education in financial practices.
For example, close to 200 million people above 15 years of age in India still do not have bank accounts. It could be because of the paperwork required and digital literacy required. With the success of UPI and the fact that 99% of all online transactions in India are conducted through the UPI platform, we see that it is not used by all 425 million smartphone users in rural India. Considering the ubiquity of UPI, which provides several oral and visual means of transactions like QR codes or voice confirmation, in many of the localised languages, only a partial number of 122 million people from rural India have used occasional means of UPI-based transactions. Incidentally, more than 300 million people from rural India who own and use smartphones have still not used UPI or any method of fintech platforms. We all know that owning and using a smartphone makes one highly capable of frequently using digital means to do their daily work, including securely making online transactions. Additionally, the use of smartphones for rural citizens helps their adaptability because smartphones are visually operable and also enable voice and symbols that come more naturally.
Digital is still not ubiquitous. “Cash is still king” is one of the sub-heads in the book, and I analyse that “India’s banking system is costly, exclusionary, patriarchal, bureaucratic, classist, and analogous in daily operation and in dealing with bottom-of-the-pyramid.” And my reply to the digital enablers, on behalf of those millions of unconnected non-digital users: “Why should I have a bank account if it is not available to me when I want it; when it is not functionally close to my doorsteps; when it is most construed to handle my own money; when it is not functional in my language and in the medium that I want? It actually makes it costlier and unmanageable by making it only digital.”
The authors have tried to explain why fintech, or rather the financial digital inclusion, is not happening as successfully as it should have. They explained that the digital technology as a medium must be Simple, Human and Ubiquitous. “Simple” is actually an effort to make the technology developed and it must work as per the socio behavioural norms. If the financial digital product is simple, it would be easy to educate, adapt and practice.
If the fintech solution has to be human and touch the hearts and minds at a mass scale, then it should be introduced to the masses with empathy, a human gesture of services, in a manner of counselling, with a complete understanding of the targeted communities culture, language, practices, health, financial practices and challenges, and it should be created such that it builds trust. A digital financial product cannot enter into the mass market by means of fear and greed; and certainly not with the approach of platformisation.
The ubiquity of any digital product and solution is based on the adoption by choice and not by force. The real test of ubiquity for financial inclusion is to first make the digital infrastructure availability ubiquitous. If we don’t have the required and necessary meaningful digital access and infrastructure available to the masses, we cannot expect the digital solutions riding on the digital infrastructure to be adopted by the people.
Bhagwan and Anas beautifully describe how the use of smartphones, unique mobile numbers, and various digital authentication methods like OTP amidst affordability issues are significant barriers while they are equally promising. Another significant insight that comes out is: financial behaviour is centred around a domestic ecosystem where the role of a woman is central, however, the digital divide among women is paramount.
“Fintech for Billions” is a must-read book for policymakers, ministries, especially the Ministry of Finance, Ministry of Rural Development and Panchayati Raj, Ministry of HR and Education, Ministry of Telecom and IT, Ministry of Women and Social Welfare and PMO. This book should also be read and referred by tech policy advisors to know what not to push, as well as all financial institutions. And my final recommendation is that each and every elected MLA, MP, District Collectors and District Commissioners must read this book.
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DEF Updates --- From #DCS 2024 - Digital Citizen Summit 2024
This week, we look at some images from DCS 2024, in t-hub, Hyderabad.
The response was so overwhelming that all 1600 passes sold out, and people were attending the sessions in parallel spaces:
Imagining a Just Future: Intersections of Access, Rights and #AI
From the panel on Internet Shutdowns:
Global Digital Inclusion Partnership at DCS:
Women in the Digital Economy Fund at DCS:
Also at T-Hub last weekend:
Delegates from Nepal, Philippines, Malaysia and Araku Valley sharing their last mile access issues and how various frugal digital tech help in connecting communities
We'll be back next week with more updates from DCS!
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