Context :
Extract :
Ø The Reserve Bank of India (RBI) has prepared the ground for allowing competition to the National Payments Corporation of India ( NPCI )
Ø The new entity will set up, manage and operate NEW PAYMENT SYSTEMS, especially in retail space, comprising but not limited to ATMs, white-label point-of-sales ( POS ) machines, Aadhar based payments, and remittance services
Ø It will also develop NEW PAYMENT METHODS, STANDARDS and TECHNOLOGIES and spend on raising awareness of payment systems
Ø The NPCI operates the RuPay and the Unified Payments Interface ( UPI ) networks
Ø It links all the ATMs of different banks to ONE NETWORK and manages other forms of electronic payments
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Some 3 years ago, I wrote :
[ source : A Matter of Time / 03 Jan 2017 ]
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Today's Mantra : Competition is the Mother of Innovation
Just wait to find out which Mobile Wallet comes up with the following " innovations " first :
* All bank accounts of a person ( in different banks ) become inter- operable / fungible ,
through seamless interlinking , using Aadhar / UPI Interface in a Mobile Wallet
No need to " select " a particular bank name
* All transactions using a Mobile Wallet, automatically entered in BLOCK-CHAIN database
commonly shared by ALL banks
* Wallet based algorithm will move funds across different bank accounts for best yield ,
constantly searching for best interest rates offered by banks on Fixed Deposits
This will happen automatically , much like algorithm-based share trading , taking
advantage of price differences in two bourses located 300 km apart ( in one thousandths
of a second ! )
No rocket science here considering availability of " BEST PRICE " apps for thousands of
goods and services
And since computing power of mobiles are doubling every 18 months ( Moore's Law ),
nothing will stop algo-trading through a Mobile Wallet , as well ! ( Demat A/C on Wallet ? )
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It is very likely that the RBI-inspired COMPETITION ( to NPCI ) may come from technology companies like TCS – INFOSYS – WIPRO – L&T INFOTECH etc
And though the selected entity will set up a payment network ( similar to NPCI ), as mandated by RBI, it will not be just another “ also ran “ !
Directors of these companies would want to go from “ E – Pay “ to “ E – Play “ , described above
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