Infosys co-founder Nandan Nilekani on Wednesday discussed innovations in financial services around the world, in payments, in lending, in cross border transactions. Talking about the innovations, Nilekani underlined that the ‘Finternet’ would empower people to participate in the upside of the economy and control all kinds of assets from user controlled to regulated and registered assets.
He said tokenisation of real-world assets, smart contracts enabled by mainstream banks and regulated by the government are the next big thing in the India’s fintech landscape.
Speaking at he Global Fintech Fest (GFF) in Mumbai, Nilekani said: “Convergence of technology can unlock exponential value… The Finternet is a new approach to global finance which is defined by the three ‘U’s’ – it is user centric, unified, and universal – that is keeping the user at the centre and it has to be universal, that is it has to cut through asset classes of all types. The Finternet combines the best of the regulated world with the best that tokenization technology can offer us. It uses the basic construct of tokens and then enables universal interoperability and composability.”
Explaining the core concept, Nilekani emphasized the objective to amalgamate various asset classifications, such as registered lands, regulated financial products, bonds, deposits, equines, and artworks, enabling their tokenization. This will facilitate access to these assets via a secure and regulated universal infrastructure.
He added: “We want to have something which allows everyone to participate and control all kinds of assets. User-controlled assets, user content, NFTs (non-fungible tokens), adjusted assets which are certified by somebody, registered assets like land, or regulated assets like financial products. All of them should be able to participate in this economy. We need a good way of protecting them from the downsides.”
He further added the importance of a universal infrastructure for financial services and continued with a demo of this new visionary Finternet architecture that aims to unify financial services with the support of advanced cyptography and tokenisation.
“Here instead of a paper file, we have a token packet. Now, why is this possible? Because of advances in cryptography. Cryptography allows you immutability. It means you cannot change. You can make sure nobody can change that packet using a blockchain. It’s verifiable. It has security. And, it has privacy,” he said.