By-Bipin Preet Singh
The year is too short a period in the history of a nation. But there are moments that become historic. One such was November 8, 2016, when the government announced withdrawal of Rs 500 and Rs 1,000 currency notes for waging a war against black money and ushering in greater deal of accountability and transparency in the financial transactions in the country. Demonetisation also proved to be momentous for the digital economy that ushered in a change in thinking and habits of people. The decision, irrespective of political debate, has brought in a digital revolution in the country, providing unheard of opportunities to fintech players and digital wallet entities. Apart from making wallet payments ubiquitous and offering convenience, digital economy offers opportunity to create jobs—the need of the hour to gain from the demographic dividend. Job creation is the standard on which the government would be judged on, if a policy is benefiting the economy. If the current economic performance is based on contributions from consumption—boosted by normal monsoon and government pay revisions—it is estimated the next wave would be backed by the young and educated workforce.
About half of India’s 1.3 billion people are under the age of 26, and by 2020 we would be the youngest country in the world, with a median age of 29. That means a growing pool of buyers for goods and services. On the other hand, India is a global leader in software solutions, which means we already have the necessary infrastructure to support a digital economy.
The probabilities are huge if this socio-economic phenomena gets wedded to the emerging opportunities that are on offer in a digital economy. Demonetisation unleashed the wallet industry—it grew at 55% in the last one year and created 2.5 lakh additional jobs. India needs to leverage this opportunity for job creation and demonetisation has provided the perfect pitch to build a bright future.
India offers a large pool of talent for fintech companies from engineering background that has an estimated average of 9 lakh graduate and post-graduate students from various engineering disciplines. IITs and other world-class institutes constitute 3.8% of the total engineering graduates that are available for fintech companies to hire. India also has a sizeable population, next to the US, who understand English, thus giving the Indian fintech space a commendable edge over other emerging Asian markets.
Evidently, the e-commerce sector, which has seen a steady flow of investment post demonetisation, promises enough job opening in the months to come. In comparison, areas such as infrastructure and FMCG space are not witnessing any major movement in opportunity creation. The government’s push for a cashless economy would only expand the job market. As it is, new avenues have opened up following RBI’s guidelines on interoperability as scores of people are being hired by wallet players to create resources for complying with KYC norms.
As more consumers and merchants warm up to the benefits of digitisation, there would be a growing requirement for service providers, data analysts, and consumer protection and grievance redressal experts. Specialised and innovative service providers have emerged to provide services such as aggregators, payment gateways and customer management.
There is a need to expose traditional sectors like agriculture that could draw immense benefits from Internet of Things. This would require significant efforts in terms of investment in research and the development of technology through a bottom-up approach. Service providers would also need to customise themselves for different consumer segments.
We need to think afresh about digital security for protection of sensitive customer data. Notwithstanding a significant impact on the existing jobs, demonetisation is a disruptive event that offers an important opportunity to create jobs. After all, good politics will only be remembered if it makes good economic sense.
The author is Founder, MobiKwik