Nikhil Kamath x Nandan Nilekani | People by WTF | Ep #3

1. 0:00 – 2:40

   Introduction

   1. SPSpeaker0:00

      [upbeat music]

   2. NNNandan Nilekani0:31

      Are we good?

   3. NKNikhil Kamath0:32

      Ready, guys? Should we start? [laughing] You've done so many interviews now.

   4. NNNandan Nilekani0:39

      Never felt so intimidated.

   5. NKNikhil Kamath0:41

      [laughing] There is so much information around the India Stack, uh, that is so relevant to a young person who wants to be an entrepreneur in India. Hopefully, by the end of it, we can learn from you what should be built on top of the India Stack, and what is the opportunity today from the lens of capitalism? [upbeat music] Hi, Nandan.

   6. NNNandan Nilekani1:10

      Hi.

   7. NKNikhil Kamath1:10

      Thank you for doing this.

   8. NNNandan Nilekani1:12

      My pleasure, Nikhil.

   9. NKNikhil Kamath1:14

      Uh, I don't think many people know, but I end up meeting Nandan most often in his house or when he's traveling to one of hundred different countries that he goes to every year.

   10. NNNandan Nilekani1:26

       That's right.

   11. NKNikhil Kamath1:26

       Uh, so where are you going next, Nandan?

   12. NNNandan Nilekani1:29

       Uh-

   13. NKNikhil Kamath1:29

       In your travels, where are you heading?

   14. NNNandan Nilekani1:30

       ... I'd say th- this month is a slow month, in the sense I'm going to be right here in, uh, uh, uh, Bangalore and in India. But I'm going next month, uh, I'm going to Basel, I'm going to London.

   15. NKNikhil Kamath1:43

       All around this technology broadly that you're involved with, most of these places?

   16. NNNandan Nilekani1:49

       Yeah, I, I basically have two hats.

   17. NKNikhil Kamath1:50

       Mm-hmm.

   18. NNNandan Nilekani1:50

       I have a, a public hat-

   19. NKNikhil Kamath1:53

       Mm

   20. NNNandan Nilekani1:53

       ... which is really the bulk of what I do-

   21. NKNikhil Kamath1:54

       Mm

   22. NNNandan Nilekani1:55

       ... which is enabling digital public infrastructure.

   23. NKNikhil Kamath1:57

       Mm-hmm.

   24. NNNandan Nilekani1:58

       You know, Aadhaar, UPI, that kind of stuff. And now we are trying to make that go global. So part of this is globalization of this DPI concept. And then I have a private sector hat as the chairman of Infosys and a few investments, so some of my travel is that, or if I go on a vacation, I just work for a couple of days, so.

   25. NKNikhil Kamath2:21

       I watched a bunch of your interviews-

   26. NNNandan Nilekani2:23

       Why would you do that? [laughing]

   27. NKNikhil Kamath2:24

       [laughing] ... over the last 48 hours.

   28. NNNandan Nilekani2:26

       Seem to be a sucker for punishment.

   29. NKNikhil Kamath2:28

       [chuckles] I feel like I know Nandan, the person in private. I, I have never heard you speak at length publicly in that way. I've heard you speak

2. 2:40 – 3:25

   India Stack

   1. NKNikhil Kamath2:40

      at your house when you host dinners and all of that. So it was actually intriguing, and there is so much information around the India Stack, uh, that is so relevant to a young person who wants to be an entrepreneur in India. So we thought we'd focus today on that.

   2. NNNandan Nilekani2:57

      Sure.

   3. NKNikhil Kamath2:57

      Uh, so I'm going to play the part of a twenty-year-old who knows nothing about the India Stack. I'll start the journey from the very beginning, and hopefully, by the end of it, we can learn from you what should be built on top of the India Stack, and what is the opportunity today from the lens of capitalism? What can me, a twenty-year-old, start to make money out of it, on top of the India Stack in any way?

3. 3:25 – 6:24

   Journey of Infosys

   1. NKNikhil Kamath3:25

      If we were to begin with Infosys, uh, is that where you would say the, the journey began in that manner, where you saw scale incrementally?

   2. NNNandan Nilekani3:36

      Yeah, I think Infosys was a great, uh, learning journey in scale.

   3. NKNikhil Kamath3:41

      Mm-hmm.

   4. NNNandan Nilekani3:42

      Uh, you know, Infosys was founded in 1981 under the leadership of, uh, Mr. Narayana Murthy, and I was one of the co-founders.

   5. NKNikhil Kamath3:50

      Mm-hmm. You're my favorite co-founder. I know a bunch of them.

   6. NNNandan Nilekani3:53

      Okay. I mean... [chuckles] Well, anyway, so I, uh, so I was part of that journey for a long time, and I learned a little bit about scale. Now, that's enterprise scale, and population scale is a completely different ballgame. So enterprise scale, how to think, uh, how to sort of look at what the future can be and sort of drive something towards that future. And then, uh, uh, that's how I... You know, I was, till 2009, I was very much in Infosys, and then I got this offer to join the government and lead the Aadhaar project.

   7. NKNikhil Kamath4:31

      Infosys was the start of the IT boom in India, right? And also Bangalore became what it is today.

   8. NNNandan Nilekani4:36

      Yeah, I think you can think of Infosys as the original, uh, start-up.

   9. NKNikhil Kamath4:39

      Right.

   10. NNNandan Nilekani4:40

       Uh, you know, we, we came- we moved to Bangalore in 1983.

   11. NKNikhil Kamath4:45

       From?

   12. NNNandan Nilekani4:45

       From Bombay. Uh, initially, we were in Bombay, Pune-

   13. NKNikhil Kamath4:48

       Mm-hmm

   14. NNNandan Nilekani4:48

       ... in that belt, and, uh, we've been there ever since, and I think, yeah, we... I mean, Bangalore has had a series of technology curves, the hardware, software, internet, you know, so many things have happened. But yeah, we were part of that wave, and I think, uh, we played a big role in establishing, uh, Bangalore as, you know, a tech city. Uh, and also, I think, even today, I meet so many people who are entrepreneurs-

   15. NKNikhil Kamath5:15

       Mm-hmm

   16. NNNandan Nilekani5:15

       ... who said they were at Infosys.

   17. NKNikhil Kamath5:17

       Right.

   18. NNNandan Nilekani5:18

       So I think it also created, spawned so many other people.

   19. NKNikhil Kamath5:22

       What worked for Ins- Infosys in a world where the incumbent large business houses were typically family businesses or, uh, I wouldn't like to say crony capitalism, but-

   20. NNNandan Nilekani5:35

       Mm

   21. NKNikhil Kamath5:35

       ... some kind of a political element involved in a business that scaled? What set Infosys apart at that point of time?

   22. NNNandan Nilekani5:42

       I think the group of founders were very, uh, uh, synergistic. We all had different strengths. Murthy was our leader. Uh, we had common values. We wanted to build for the long term. We were marathon runners-

   23. NKNikhil Kamath5:59

       Mm

   24. NNNandan Nilekani5:59

       ... we were not sprinters. We built for the long term.

   25. NKNikhil Kamath6:01

       Mm-hmm.

   26. NNNandan Nilekani6:02

       We had a vision of creating a globally respected company of having very high standards of, uh-... corporate governance. So there are a whole set of values, Infosys values, which are deep in everyone. And that, I think, uh, sort of gave the fuel to make it happen. You have to have a vision, you have to have passion about something, you know, we had all that.

   27. NKNikhil Kamath6:23

       Mm.

4. 6:24 – 8:15

   Imagining India - Digitising the Future

   1. NKNikhil Kamath6:24

      And you moved from Infosys, you retired first, and then Aadhaar came your way?

   2. NNNandan Nilekani6:29

      No, what happened was in 2009, in 2008-

   3. NKNikhil Kamath6:33

      Mm

   4. NNNandan Nilekani6:34

      ... I wrote a book called Imagining India.

   5. NKNikhil Kamath6:36

      Mm.

   6. NNNandan Nilekani6:37

      So sort of projecting how India could be-

   7. NKNikhil Kamath6:40

      Mm-hmm

   8. NNNandan Nilekani6:40

      ... in, in the framework of ideas.

   9. NKNikhil Kamath6:42

      Mm-hmm.

   10. NNNandan Nilekani6:43

       Why ideas matter and stuff like that. And w- a- among the ideas in that book was, you know, digital ID and so on.

   11. NKNikhil Kamath6:48

       Mm-hmm.

   12. NNNandan Nilekani6:50

       So, at the same time, the government was planning a digital ID program.

   13. NKNikhil Kamath6:54

       Mm-hmm.

   14. NNNandan Nilekani6:55

       And, uh, they had got cabinet approval for that project.

   15. NKNikhil Kamath7:00

       Mm-hmm.

   16. NNNandan Nilekani7:00

       And, uh, I was, uh, I had a chance to take up that role. So... And then my Infosys co-founders were very kind and said, "Yeah, you can go and do some national service." So that's how I ended up in Delhi in July of 2009, to build India's digital program, ID program.

   17. NKNikhil Kamath7:20

       And before Infosys, Nandan, you were in, uh, Bombay before that?

   18. NNNandan Nilekani7:25

       Yeah, I, I'm- I was born in Bangalore.

   19. NKNikhil Kamath7:27

       Mm.

   20. NNNandan Nilekani7:27

       In that sense, I'm an original Bangalorean.

   21. NKNikhil Kamath7:29

       Mm. Mm.

   22. NNNandan Nilekani7:30

       I was born in Manivilas Hospital-

   23. NKNikhil Kamath7:32

       Mm

   24. NNNandan Nilekani7:32

       ... in Bangalore.

   25. NKNikhil Kamath7:33

       Mm.

   26. NNNandan Nilekani7:34

       And my father worked in a m- textile mill in, uh, Magadi Road.

   27. NKNikhil Kamath7:38

       Right.

   28. NNNandan Nilekani7:38

       Ma- in, uh, Magadi Road.

   29. NKNikhil Kamath7:40

       Industrial area now.

   30. NNNandan Nilekani7:40

       Yeah. And, uh, then the, the, you know, the mill sector got into difficulties, so-
5. 8:15 – 9:40

   Nandan on meeting Rohini

   1. NKNikhil Kamath8:15

      in college? I re- I remember you guys mentioning this story.

   2. NNNandan Nilekani8:18

      Yeah, I met Rohini because she was in, uh, Elphinstone College.

   3. NKNikhil Kamath8:21

      Right.

   4. NNNandan Nilekani8:22

      I was in IIT.

   5. NKNikhil Kamath8:23

      Yeah.

   6. NNNandan Nilekani8:23

      And-

   7. NKNikhil Kamath8:23

      And she described you as this badass person who did something when she narrated this story.

   8. NNNandan Nilekani8:28

      No, no, what happened was, uh, uh, we had a quiz competition.

   9. NKNikhil Kamath8:32

      Mm.

   10. NNNandan Nilekani8:32

       So I was representing IIT in the quiz, and the quiz was in Elphinstone College-

   11. NKNikhil Kamath8:36

       Mm

   12. NNNandan Nilekani8:36

       ... and obviously, we won the quiz.

   13. NKNikhil Kamath8:38

       Mm.

   14. NNNandan Nilekani8:39

       So I think she was-

   15. NKNikhil Kamath8:39

       Why obviously you won?

   16. NNNandan Nilekani8:41

       I mean, we had that, uh-

   17. NKNikhil Kamath8:42

       Mm

   18. NNNandan Nilekani8:43

       ... belief that [chuckles] we could, we're good at this stuff. So, uh, that's how I met her.

   19. NKNikhil Kamath8:48

       Mm.

   20. NNNandan Nilekani8:49

       That's way back in '77.

   21. NKNikhil Kamath8:52

       She's the more outspoken of the two of you, right?

   22. NNNandan Nilekani8:55

       No, she's, uh, more spontaneous.

   23. NKNikhil Kamath8:57

       Mm.

   24. NNNandan Nilekani8:57

       She's more, uh, uh... I would say more, uh, emotional or mercurial-

   25. NKNikhil Kamath9:03

       Mm

   26. NNNandan Nilekani9:03

       ... or whatever.

   27. NKNikhil Kamath9:04

       Mm.

   28. NNNandan Nilekani9:05

       I'm more sedate. I'm, I'm the boring type.

   29. NKNikhil Kamath9:08

       [chuckles] And she says what she's thinking, right away-

   30. NNNandan Nilekani9:11

       Correct
6. 9:40 – 13:11

   Journey of India Stack: Aadhar

   1. NKNikhil Kamath9:40

      I'm gonna write it down because I'm learning with everybody who's going to watch this. Uh, so Aadhaar, first thing first. So the government asked you to build a digital ID?

   2. NNNandan Nilekani9:51

      No, the government asked me to build a unique ID.

   3. NKNikhil Kamath9:54

      A unique ID.

   4. NNNandan Nilekani9:54

      There was no digital in it.

   5. NKNikhil Kamath9:56

      Right.

   6. NNNandan Nilekani9:56

      I made it digital-

   7. NKNikhil Kamath9:57

      Right

   8. NNNandan Nilekani9:58

      ... because I said, in 2009, "If you're going to build an ID, it has to be a digital ID."

   9. NKNikhil Kamath10:02

      Okay.

   10. NNNandan Nilekani10:02

       "It has to be online. It has to be verifiable online with real time and all that stuff."

   11. NKNikhil Kamath10:07

       Mm.

   12. NNNandan Nilekani10:07

       So those were the value add that my team and I did, was how do we execute this using a digital-first way?

   13. NKNikhil Kamath10:15

       Mm. So in 2009, what was the benchmark you set for yourself while starting the Aadhaar project? Who were you looking at? Who had done well with a unique ID? Who had not-

   14. NNNandan Nilekani10:26

       Nobody had done it, so it was a-

   15. NKNikhil Kamath10:27

       Mm

   16. NNNandan Nilekani10:27

       ... it was a brand-new idea.

   17. NKNikhil Kamath10:29

       Is Social Security in America a similar concept? The number-

   18. NNNandan Nilekani10:32

       No, Social Security in, in America came in 1936-

   19. NKNikhil Kamath10:35

       Right

   20. NNNandan Nilekani10:35

       ... before technology.

   21. NKNikhil Kamath10:37

       Mm-hmm.

   22. NNNandan Nilekani10:38

       And, uh, in fact, the first use of mainframes was that. So mainframes were used because there was SSN. So SSN was a number, but it was a paper-based number.

   23. NKNikhil Kamath10:47

       Mm. Just tell us full forms of all of this, because-

   24. NNNandan Nilekani10:50

       Yeah, so SSN is Social Security number.

   25. NKNikhil Kamath10:53

       Mm.

   26. NNNandan Nilekani10:54

       Which, uh, which the US did, because what happened that- what happened then was that, uh, Franklin Roosevelt-

   27. NKNikhil Kamath11:00

       Mm

   28. NNNandan Nilekani11:00

       ... uh, during the, uh, you know, the, the '30s, after the whole, uh, re, economic crisis in the US, they came out with a scheme where people could get benefits in their old age-

   29. NKNikhil Kamath11:13

       Mm-hmm

   30. NNNandan Nilekani11:14

       ... if they worked.
7. 13:11 – 15:07

   DPI - Digital Public Infrastructure

   1. NKNikhil Kamath13:11

      And did the market play a large role in this process?

   2. NNNandan Nilekani13:15

      No, what we... We were looking at how do you create digital infrastructure on which market or private innovation could be done?

   3. NKNikhil Kamath13:25

      Right.

   4. NNNandan Nilekani13:25

      So, and we call this as public rails and private innovation.

   5. NKNikhil Kamath13:31

      This is broadly DPI, area?

   6. NNNandan Nilekani13:33

      DPI. So the, but, I mean, the idea has evolved, but it was actually, uh, you know, constructed on concepts like, I'm not wrong, on the internet.

   7. NKNikhil Kamath13:41

      Mm-hmm.

   8. NNNandan Nilekani13:41

      If you look at the internet, internet was funded by the US government.

   9. NKNikhil Kamath13:44

      Right.

   10. NNNandan Nilekani13:45

       But on top of that, you had all these startup, uh, companies that came up-

   11. NKNikhil Kamath13:48

       Right

   12. NNNandan Nilekani13:48

       ... right? Similarly, GPS-

   13. NKNikhil Kamath13:49

       Right

   14. NNNandan Nilekani13:50

       ... was again created by the US Department of Defense, but, uh, on top of that, we had, you know, Uber and all these things-

   15. NKNikhil Kamath13:57

       Mm-hmm

   16. NNNandan Nilekani13:57

       ... Ola, and so on, Maps.

   17. NKNikhil Kamath13:59

       Mm-hmm.

   18. NNNandan Nilekani14:00

       So the notion that if you create a digital public infrastructure at population scale-

   19. NKNikhil Kamath14:05

       Mm-hmm

   20. NNNandan Nilekani14:05

       -and open it up with application programming interfaces, so anybody can build application, then it'll unleash innovation.

   21. NKNikhil Kamath14:13

       Right.

   22. NNNandan Nilekani14:14

       So that was the philosophy of the design of Aadhaar, and subsequently UPI, as a API-led architecture, which everybody could use.

   23. NKNikhil Kamath14:24

       Mm-hmm.

   24. NNNandan Nilekani14:25

       And then, whether it's a startup or a large company, they could then build, you know, useful applications on top of it.

   25. NKNikhil Kamath14:32

       Right. And when you started on the Aadhaar project, this was 2009?

   26. NNNandan Nilekani14:36

       Yeah.

   27. NKNikhil Kamath14:37

       How long did it take?

   28. NNNandan Nilekani14:39

       Well, I, I was in the government for about four and a half years.

   29. NKNikhil Kamath14:42

       Right.

   30. NNNandan Nilekani14:42

       And I had made a commitment that I would deliver six hundred million people with Aadhaar by the time I-
8. 15:07 – 17:15

   Online Authentication & KYC

   1. NKNikhil Kamath15:08

      eKYC and eSign on top of it?

   2. NNNandan Nilekani15:10

      Yeah, no, Aadhaar was an ID that just said, Nikhil is Nikhil.

   3. NKNikhil Kamath15:14

      Right.

   4. NNNandan Nilekani15:14

      And it-

   5. NKNikhil Kamath15:14

      And this happened between 2009 and '13?

   6. NNNandan Nilekani15:17

      Yeah.

   7. NKNikhil Kamath15:17

      Okay.

   8. NNNandan Nilekani15:18

      And scaled up to six hundred million.

   9. NKNikhil Kamath15:20

      Okay.

   10. NNNandan Nilekani15:20

       And with an online authentication. So you could go somewhere, put your finger, and verify that Nikhil is Nikhil. You say, "My number is one, two, three," and the system would confirm that it is that. So we call that an online authentication.

   11. NKNikhil Kamath15:31

       Okay.

   12. NNNandan Nilekani15:32

       And then everyone's ID had a KY- uh, had the name, and address, and date of birth, and all that.

   13. NKNikhil Kamath15:37

       Mm-hmm.

   14. NNNandan Nilekani15:38

       That was considered sufficient KYC to open a bank account, get a mobile connection, or buy a-

   15. NKNikhil Kamath15:45

       What does Aadhaar have? Name, date of birth, mobile number, address.

   16. NNNandan Nilekani15:48

       Sex, email ID, and phone number. It's quite simple, but-

   17. NKNikhil Kamath15:53

       Right

   18. NNNandan Nilekani15:53

       ... it was, it was unique. A person could have only one number, which was the design was how to make it unique.

   19. NKNikhil Kamath15:58

       Right.

   20. NNNandan Nilekani15:59

       So then, using the additional information in Aadhaar, you could do a KYC.

   21. NKNikhil Kamath16:03

       Mm.

   22. NNNandan Nilekani16:04

       And then the regulators agreed that this KYC was adequate to b- get a bank account, or a mobile connection-

   23. NKNikhil Kamath16:10

       Mm

   24. NNNandan Nilekani16:10

       ... or buy a mutual fund, or whatever.

   25. NKNikhil Kamath16:13

       How did that work? How did you convince the regulator to accept Aadhaar as a-

   26. NNNandan Nilekani16:18

       Yeah, so we had to first work with the government of India under the, you know, many acts.

   27. NKNikhil Kamath16:26

       Mm-hmm.

   28. NNNandan Nilekani16:27

       Uh, because at that time, uh, you know, Prevention of Money Laundering Act-

   29. NKNikhil Kamath16:30

       Mm

   30. NNNandan Nilekani16:30

       ... and there was lot, lots of things happening. So we had to get it approved as a KYC in general, then we had to work with each regulator.
9. 17:15 – 19:00

   Jan Dhan Program

   1. NKNikhil Kamath17:15

      Mm

   2. NNNandan Nilekani17:15

      ... uh, Jan Dhan Yojana program, which was to give bank accounts to everybody.

   3. NKNikhil Kamath17:19

      Right.

   4. NNNandan Nilekani17:20

      And that was a big push from the government to issue bank accounts to everyone, and Aadhaar KYC accelerated that, because you could do a KYC-

   5. NKNikhil Kamath17:28

      Mm-hmm

   6. NNNandan Nilekani17:29

      ... uh, immediately and get a bank account.

   7. NKNikhil Kamath17:31

      You mentioned somewhere that it brought down the time taken to give people bank accounts by, from forty-seven years to nine years.

   8. NNNandan Nilekani17:38

      Yeah. So on the normal GDP, if you had looked at it-

   9. NKNikhil Kamath17:41

      Mm

   10. NNNandan Nilekani17:41

       ... it will take you forty-six years to get to the level of banking penetration that we did in nine years, because you accelerated with-

   11. NKNikhil Kamath17:47

       Mm

   12. NNNandan Nilekani17:47

       ... digital technology. And then-

   13. NKNikhil Kamath17:49

       eKYC was the reason for that?

   14. NNNandan Nilekani17:51

       Huh?

   15. NKNikhil Kamath17:51

       eKYC was the main reason for that?

   16. NNNandan Nilekani17:52

       Yeah. I mean, no, no, I mean, the, there was political push-

   17. NKNikhil Kamath17:55

       Mm

   18. NNNandan Nilekani17:55

       ... government pr, uh, push, customer demand.

   19. NKNikhil Kamath17:58

       Mm-hmm.

   20. NNNandan Nilekani17:59

       You know, banks had to execute, so a lot of things went into it.

   21. NKNikhil Kamath18:01

       Mm-hmm.

   22. NNNandan Nilekani18:02

       Uh, but the techni- technological capability of doing a KYC, you know, online, on the fly, within two minutes-

   23. NKNikhil Kamath18:10

       Mm-hmm

   24. NNNandan Nilekani18:10

       ... reduced your transaction time and cost.

   25. NKNikhil Kamath18:12

       Right.

   26. NNNandan Nilekani18:13

       So it was an enabler. Same thing happened with mobile connections.

   27. NKNikhil Kamath18:16

       Mm-hmm.

   28. NNNandan Nilekani18:16

       So we launched Aadhaar KYC in, say, 2012, '13-

   29. NKNikhil Kamath18:19

       Mm-hmm

   30. NNNandan Nilekani18:20

       ... It's only when Jio got launched in 2016-
10. 19:00 – 20:40

    E- sign/ Digilocker

    1. NKNikhil Kamath19:00

       time?

    2. NNNandan Nilekani19:00

       Yeah, eSign happened in 2015 when, uh, Ram Sewak Sharma, who was my DG at when I was the chairman of UIDAI, he became the IT secretary.

    3. NKNikhil Kamath19:09

       Mm-hmm.

    4. NNNandan Nilekani19:09

       So he launched, uh, eSign and DigiLocker-

    5. NKNikhil Kamath19:12

       Mm

    6. NNNandan Nilekani19:12

       -and all these other capabilities.

    7. NKNikhil Kamath19:13

       They came together, eSign and DigiLocker?

    8. NNNandan Nilekani19:15

       Yeah, they ca- ... No, they came ... Yeah, around 2015 they were launched. At different times, they became- Yeah.

    9. NKNikhil Kamath19:22

       Mm-hmm.

    10. NNNandan Nilekani19:22

        But I would say they were launched at the same time.

    11. NKNikhil Kamath19:24

        So let's say DigiLocker is a wallet for government IDs?

    12. NNNandan Nilekani19:29

        No. It's a, it's a general purpose omnibus wallet for all documents, in a secure way.

    13. NKNikhil Kamath19:34

        Right.

    14. NNNandan Nilekani19:34

        Which you can keep on your phone or on the cloud.

    15. NKNikhil Kamath19:36

        Mm-hmm.

    16. NNNandan Nilekani19:37

        And you can keep your driver's license, your Aadhaar card, your drive- uh, you know, your, your PAN card, but it can be used by private guys, too.

    17. NKNikhil Kamath19:45

        How did you describe that, general purpose?

    18. NNNandan Nilekani19:47

        It's a general purpose document wallet, secure document wallet-

    19. NKNikhil Kamath19:50

        Mm

    20. NNNandan Nilekani19:50

        ... which can be in the phone or on the cloud.

    21. NKNikhil Kamath19:52

        Mm-hmm.

    22. NNNandan Nilekani19:53

        Which then you can keep all kinds of doc- you can keep your high school graduation, uh, details, you can keep your marks card. It's not ... It can be any document.

    23. NKNikhil Kamath20:02

        Mm.

    24. NNNandan Nilekani20:03

        So now there are billions of documents in, I think, more than, uh, uh-

    25. NKNikhil Kamath20:07

        And what did people use eSign for?

    26. NNNandan Nilekani20:10

        eSign was to do digital signatures.

    27. NKNikhil Kamath20:12

        Mm.

    28. NNNandan Nilekani20:12

        So, you know, to- to, for example, if you buy a property and you have to sign thing, you can do a digital signature, or if you si- signing a contract, you can use digital signature. So this-

    29. NKNikhil Kamath20:23

        And you couldn't do this up until now because you didn't have a unique ID, and you could not authorize the unique ID to sign, but now you could?

    30. NNNandan Nilekani20:29

        Yeah, yeah. A number of things, yeah-
11. 20:40 – 22:36

    2016 - a big digital transformation for India

    1. NNNandan Nilekani20:40

       both came in 2015.

    2. NKNikhil Kamath20:41

       2015.

    3. NNNandan Nilekani20:43

       But the big year was 2016.

    4. NKNikhil Kamath20:45

       Hmm. What, uh, what happened in 2016?

    5. NNNandan Nilekani20:48

       It was a remarkable year-

    6. NKNikhil Kamath20:49

       Mm

    7. NNNandan Nilekani20:49

       ... for our digital transformation. First, on April 4th, 2016, India reached one billion Aadhaars. That was a landmark achievement. April 11, 2016, India launched UPI.

    8. NKNikhil Kamath21:08

       Mm-hmm.

    9. NNNandan Nilekani21:09

       Completely independent, uh, coincidence.

    10. NKNikhil Kamath21:12

        Mm-hmm.

    11. NNNandan Nilekani21:14

        September 5th, 2016, Reliance Jio was launched.

    12. NKNikhil Kamath21:19

        Mm-hmm.

    13. NNNandan Nilekani21:22

        November 8th, 2016, demonetization happened.

    14. NKNikhil Kamath21:28

        Mm-hmm.

    15. NNNandan Nilekani21:30

        And December 29, 2016, the Prime Minister launched the BHIM application.

    16. NKNikhil Kamath21:35

        Mm-hmm.

    17. NNNandan Nilekani21:35

        So in one year, everything changed.

    18. NKNikhil Kamath21:39

        Why do you add Reliance Jio to this list as a-

    19. NNNandan Nilekani21:42

        Because it transformed India's mobile industry. They launched-

    20. NKNikhil Kamath21:46

        Mm-hmm

    21. NNNandan Nilekani21:46

        ... a very low-cost, uh, low- lowest di- data rates in the world.

    22. NKNikhil Kamath21:51

        Mm-hmm.

    23. NNNandan Nilekani21:52

        Voice was free. That created huge demand for, uh, smartphones, so smartphone prices fell.

    24. NKNikhil Kamath21:58

        Mm-hmm.

    25. NNNandan Nilekani21:58

        The, you can see the data, they're very clear.

    26. NKNikhil Kamath22:01

        Mm-hmm.

    27. NNNandan Nilekani22:02

        In 2016 onwards, we saw the boom in data. Now, before that, we had a voice economy.

    28. NKNikhil Kamath22:07

        Mm-hmm.

    29. NNNandan Nilekani22:08

        Pre-Jio, we had a what are called as minute factories.

    30. NKNikhil Kamath22:12

        Right.
12. 22:36 – 26:49

    BHIM - Ease of Payments

    1. NNNandan Nilekani22:36

       BHIM essentially popularized online payments, because BHIM was a app launched by NPCI-

    2. NKNikhil Kamath22:45

       Mm-hmm

    3. NNNandan Nilekani22:45

       ... launched by the Prime Minister, built by NPCI.

    4. NKNikhil Kamath22:47

       Mm-hmm.

    5. NNNandan Nilekani22:48

       And it, for the first time-

    6. NKNikhil Kamath22:49

       NPCI is?

    7. NNNandan Nilekani22:50

       NPCI is the National Payment Corporation of India, which runs India's payment systems.

    8. NKNikhil Kamath22:55

       Mm-hmm.

    9. NNNandan Nilekani22:55

       It's a, it's a amazing organization.

    10. NKNikhil Kamath22:57

        Mm-hmm.

    11. NNNandan Nilekani22:58

        So NPCI launched BHIM, and BHIM was the first exposure people got to a mobile payment app.

    12. NKNikhil Kamath23:05

        Mm-hmm.

    13. NNNandan Nilekani23:06

        And then, of course, everybody well, came in. You had Google Pay, PhonePe, Paytm-

    14. NKNikhil Kamath23:11

        Mm-hmm

    15. NNNandan Nilekani23:11

        ... all that. And then, of course, today, UPI does 14.4 billion transactions-

    16. NKNikhil Kamath23:17

        Mm-hmm

    17. NNNandan Nilekani23:18

        ... in a month.

    18. NKNikhil Kamath23:19

        Can you explain the difference between a BHIM kind of transaction and a UPI transaction?

    19. NNNandan Nilekani23:25

        A BHIM wa- is a particular app.

    20. NKNikhil Kamath23:28

        Hmm.

    21. NNNandan Nilekani23:29

        So I- it's a cons- consumer app on my phone on which I can initiate a payment.

    22. NKNikhil Kamath23:34

        Mm-hmm.

    23. NNNandan Nilekani23:34

        UPI is Unified Payment Interface, which is a underlying protocol-

    24. NKNikhil Kamath23:38

        Mm-hmm

    25. NNNandan Nilekani23:39

        ... which makes the payment happen between two apps and two different bank accounts.

    26. NKNikhil Kamath23:44

        Can you, like, break that down for me? What do you mean by protocol? I heard a bunch of- I read a bunch of the stuff you've written as well, where you use the word protocol a lot.

    27. NNNandan Nilekani23:53

        Yeah.

    28. NKNikhil Kamath23:54

        What is a protocol?

    29. NNNandan Nilekani23:55

        Protocol is just a way of describing the packet of exchange of a transaction.

    30. NKNikhil Kamath24:03

        Mm-hmm.
13. 26:49 – 30:00

    How has UPI changed India’s ecosystem?

    1. NKNikhil Kamath26:49

       more about UPI, because it seems like it's this thing which changed the entire ecosystem. So you said it's a protocol, INR representation, store was one bank account to another bank account. Why did it scale in the manner that it did? What did it provide that a traditional bank account to bank account transfer did not?

    2. NNNandan Nilekani27:09

       Well, at that time, there was, before UPI, there was no way for two people to make a payment to each other.

    3. NKNikhil Kamath27:15

       Mm.

    4. NNNandan Nilekani27:15

       I mean, if I sit with you, how do I send you money? There was, there was no, there was no way to do it.

    5. NKNikhil Kamath27:20

       What if I go to my bank and do... They used to have that net transfer and all.

    6. NNNandan Nilekani27:24

       Yeah, you can do net banking and all-

    7. NKNikhil Kamath27:25

       Mm

    8. NNNandan Nilekani27:25

       ... that's already, you know, you go there, do something.

    9. NKNikhil Kamath27:28

       Mm.

    10. NNNandan Nilekani27:28

        It's... Here, I can just tap on my phone and send you money. Uh, the convenience, real time, ease of use, and convenience was a different league. Now, UPI was conceived in 2013.

    11. NKNikhil Kamath27:37

        Mm.

    12. NNNandan Nilekani27:38

        And, uh, in 2015, I became an advisor to NPCI on innovation and public policy.

    13. NKNikhil Kamath27:46

        Mm-hmm.

    14. NNNandan Nilekani27:46

        And NPCI built it. Uh, it took three years to build it, and launched it on, let's say, on May 11, 2016.

    15. NKNikhil Kamath27:53

        Mm.

    16. NNNandan Nilekani27:54

        And it was, you know, designed by NPCI, Dilip Asbe and others, and Pramod on the architecture side. Dr. Pramod Varma was also the Aadhaar architect. So all these people got together and designed this amazing, very high volume, very low cost, highly scalable payment infrastructure.

    17. NKNikhil Kamath28:11

        Mm.

    18. NNNandan Nilekani28:11

        So it made s- sending money as easy as sending an email-

    19. NKNikhil Kamath28:15

        Mm-hmm

    20. NNNandan Nilekani28:16

        ... or sending a WhatsApp message.

    21. NKNikhil Kamath28:17

        Is that because now each person had a unique ID per se, or-

    22. NNNandan Nilekani28:21

        No, you could have multiple. The UPI was actually more sophisticated in the sense that you could have a UPI ID.

    23. NKNikhil Kamath28:28

        Mm-hmm.

    24. NNNandan Nilekani28:29

        So, uh, it could, it could connect to a, it's called a, you know, virtual ID. It can connect to a bank account, uh, you could use a account number, you could use a mobile number as the address, you could use a, a virtual name as the address. So Nikhil@ some Axis Bank or something. So we- all these possibilities are there. So it just made it easy to use-

    25. NKNikhil Kamath28:49

        Mm-hmm

    26. NNNandan Nilekani28:50

        ... and real time. So, and then two big things happened, right? So demonetization gave the first boost to digital payments, because people had to make payments and, you know, cash was not there. And then the pandemic also, people didn't want to, uh, hand over money. They would rather point to a QR code and send money. So both these two tailwinds actu- also drove the... And of course, the ease of use and the amazing benefits people got from it.

    27. NKNikhil Kamath29:18

        Right. So DPI journey, let's say, started in 2009, when you started building Aadhaar. By 2013, you had largely solved for online authentication.

    28. NNNandan Nilekani29:30

        Yeah, already up and running.

    29. NKNikhil Kamath29:32

        And benefit transfer via Aadhaar in a way.

    30. NNNandan Nilekani29:34

        Yeah.
14. 30:00 – 32:50

    Nandan on vision with Population Scale

    1. NKNikhil Kamath30:00

       you mention the word population scale a lot. Like, in every interview-

    2. NNNandan Nilekani30:04

       [chuckles]

    3. NKNikhil Kamath30:04

       ... I would have heard you say it two, three times.

    4. NNNandan Nilekani30:07

       That's why you shouldn't watch my interviews.

    5. NKNikhil Kamath30:08

       [chuckles] Why does that word matter so much to you? Why does everything you build need to scale?

    6. NNNandan Nilekani30:13

       Because if you want to move the needle-

    7. NKNikhil Kamath30:15

       Mm

    8. NNNandan Nilekani30:17

       ... and if you want to use digital technology to move the needle, you can only do it if you reach everyone.

    9. NKNikhil Kamath30:24

       Mm.

    10. NNNandan Nilekani30:25

        You know, when you build a private company, you build for-... five, ten million people, fifteen million people, the top people, rich people, whatever.

    11. NKNikhil Kamath30:36

        Mm-hmm.

    12. NNNandan Nilekani30:37

        But in building a society scale transformation, you reach everyone, and India has a billion-plus people. So you have to think, how do you do things in a way that everybody can participate? How does everybody participate? That's why we had to give Aadhaar to everyone. We had to make bank accounts for everyone, mobile connections for everyone, you know, DBT for everyone. So the moment you want to do it for everyone-

    13. NKNikhil Kamath31:03

        Mm-hmm

    14. NNNandan Nilekani31:04

        ... if you want inclusion to happen, you have to think at population scale.

    15. NKNikhil Kamath31:09

        They say when most people get very rich, very fast, they sometimes hate themself and think the world is a terrible place, and feel the world is unfair. Uh, you-

    16. NNNandan Nilekani31:23

        When they get rich?

    17. NKNikhil Kamath31:23

        When they get very rich, very quickly.

    18. NNNandan Nilekani31:25

        Why, why is that?

    19. NKNikhil Kamath31:25

        Psychology says that. I think it's a partly imposter complex, partly something... They feel that it's unfair that they got so much, whereas the rest of the world doesn't have.

    20. NNNandan Nilekani31:36

        Oh, okay.

    21. NKNikhil Kamath31:37

        Post the success of Infosys, what drove you on this journey? And is that why population scale matters?

    22. NNNandan Nilekani31:46

        No, because at Infosys, I'd done a set of things, but when I got a chance to do Aadhaar, I, I genuinely believed that digital technology used properly can make a big difference to lives of people. So I had that belief, and it's there in my book, two thousand and eight. So that- And then I got a chance to practice those beliefs, right? I mean, it's not as... Although you can have an idea-

    23. NKNikhil Kamath32:18

        Mm-hmm

    24. NNNandan Nilekani32:18

        ... but somebody say, "Okay, fine, great idea. Now go and do it," right? So it's a very different thing. So I got a chance to get it done, and then I realized that actually we have to do a number of things. So the last fifteen years, we have built different, uh, parts of this infrastructure, and I think it's made a difference because it's made it more inclusive. Everybody is in the system. It's helped to formalize, it's driving economic growth. You know, all the, all of that is happening because we have this way of thinking about digital infrastructure.

    25. NKNikhil Kamath32:49

        Right.

15. 32:50 – 37:40

    Account Aggregation

    1. NKNikhil Kamath32:50

       And beyond two thousand and sixteen, when these inflection points happened, what came in twenty seventeen, eighteen? When did account, when did account aggregation come about?

    2. NNNandan Nilekani33:00

       I say, interestingly-

    3. NKNikhil Kamath33:01

       Mm

    4. NNNandan Nilekani33:01

       ... account aggregation, the first conversation also happened in twenty sixteen.

    5. NKNikhil Kamath33:05

       Hmm.

    6. NNNandan Nilekani33:06

       Because we- if you look at the DigiLocker architecture-

    7. NKNikhil Kamath33:10

       Mm-hmm

    8. NNNandan Nilekani33:10

       ... it was all about how documents could be stored-

    9. NKNikhil Kamath33:14

       Mm-hmm

    10. NNNandan Nilekani33:14

        ... exchanged, and so on. So it was really a data exchange in, in some way, right? And then we wanted to implement that in, uh, different areas.

    11. NKNikhil Kamath33:25

        Hmm.

    12. NNNandan Nilekani33:26

        And we had a architecture defined for that. And it so happened that the Reserve Bank of India had come out with a idea of account aggregator to, for aggregating data.

    13. NKNikhil Kamath33:38

        Mm-hmm. Can you explain what is account aggregation?

    14. NNNandan Nilekani33:40

        So account aggregation is, I, as a consumer, let's say I'm a financial consumer.

    15. NKNikhil Kamath33:45

        Mm-hmm. Is it mainly for financial data?

    16. NNNandan Nilekani33:47

        No, it can be used for anything, but finance is the most obvious use case.

    17. NKNikhil Kamath33:50

        Right.

    18. NNNandan Nilekani33:50

        So if I want to create a bal- personal balance sheet of all my assets and liabilities-

    19. NKNikhil Kamath33:54

        Right

    20. NNNandan Nilekani33:56

        ... I have to get a bank statement from all my banks.

    21. NKNikhil Kamath33:58

        Mm-hmm.

    22. NNNandan Nilekani33:58

        I have to get, uh, detail of all my mutual fund assets-

    23. NKNikhil Kamath34:02

        Mm-hmm

    24. NNNandan Nilekani34:02

        ... my insurance policies-

    25. NKNikhil Kamath34:03

        Mm-hmm

    26. NNNandan Nilekani34:04

        ... my pension funds-

    27. NKNikhil Kamath34:05

        Mm-hmm

    28. NNNandan Nilekani34:05

        ... my, you know, NPA-

    29. NKNikhil Kamath34:06

        Mm-hmm

    30. NNNandan Nilekani34:06

        ... my EPO.
16. 37:40 – 40:10

    Fast TAG & broad benefits of UPI

    1. NNNandan Nilekani37:40

       a couple of other things which happened was the FastTag system-

    2. NKNikhil Kamath37:46

       Mm-hmm

    3. NNNandan Nilekani37:47

       ... which I had designed in 2010.

    4. NKNikhil Kamath37:49

       Mm-hmm.

    5. NNNandan Nilekani37:50

       And that was to give everybody a, every vehicle an ID. So just like Aadhaar gave every individual an ID, FastTag essentially gives every vehicle an ID, which is connected to a, a value instrument, a wallet or a bank account.

    6. NKNikhil Kamath38:06

       Mm-hmm.

    7. NNNandan Nilekani38:07

       And that streamlined the movement of vehicles on highways.

    8. NKNikhil Kamath38:11

       Mm-hmm.

    9. NNNandan Nilekani38:11

       And today that does two point five billion transactions a year.

    10. NKNikhil Kamath38:15

        Will it get to the point soon where you don't have to stop?

    11. NNNandan Nilekani38:19

        Y- yeah, I, I mean, you, you don't, you have to slow down-

    12. NKNikhil Kamath38:24

        Mm-hmm

    13. NNNandan Nilekani38:25

        ... because it takes time for the RFID tag to be read, but it's pretty efficient-

    14. NKNikhil Kamath38:29

        Mm

    15. NNNandan Nilekani38:29

        ... I mean, compared.

    16. NKNikhil Kamath38:30

        Mm.

    17. NNNandan Nilekani38:30

        If you want to make it completely without stopping, maybe you have to use a different, uh, technology.

    18. NKNikhil Kamath38:35

        Technology.

    19. NNNandan Nilekani38:35

        But this is good, and it, it reduced from people waiting for hours to, you know-

    20. NKNikhil Kamath38:39

        Correct

    21. NNNandan Nilekani38:39

        ... seconds, so it's not bad.

    22. NKNikhil Kamath38:40

        Correct. So FastTag happened-

    23. NNNandan Nilekani38:41

        So but FastTag also a platform.

    24. NKNikhil Kamath38:43

        Uh.

    25. NNNandan Nilekani38:43

        FastTag was a platform where a vehicle could make a digital payment on the fly.

    26. NKNikhil Kamath38:50

        Right.

    27. NNNandan Nilekani38:50

        So the first use case of that was electronic, uh, I mean, uh, toll- tolls.

    28. NKNikhil Kamath38:56

        Right.

    29. NNNandan Nilekani38:56

        But it can also be used for congestion charges-

    30. NKNikhil Kamath38:59

        Right
17. 40:10 – 42:50

    What should a 25 y/o build on top of India Stack?

    1. NKNikhil Kamath40:10

       Right. So now me, as a twenty-year-old or twenty-five-year-old, figured out the India Stack journey broadly. What do I build today?

    2. NNNandan Nilekani40:18

       That is your innovation.

    3. NKNikhil Kamath40:20

       Um, but give me some suggestions.

    4. NNNandan Nilekani40:22

       I mean, look-

    5. NKNikhil Kamath40:23

       Let's say I'm able to raise one crore rupees from somebody, and now-

    6. NNNandan Nilekani40:27

       You give, you give.

    7. NKNikhil Kamath40:28

       [chuckles] Yeah, and what do we build on top of any of this today, which is like low-hanging fruit, opportunities?

    8. NNNandan Nilekani40:35

       Well, you know, it's up to people. I mean, I look- I... When I see the companies that use this-

    9. NKNikhil Kamath40:42

       Mm

    10. NNNandan Nilekani40:43

        ... I, I see idea that I, I would never have thought of.

    11. NKNikhil Kamath40:47

        Mm.

    12. NNNandan Nilekani40:47

        You know, the other day, I, I met a company from Lucknow-

    13. NKNikhil Kamath40:50

        Mm

    14. NNNandan Nilekani40:51

        ... which is helping roads- roadside, you know, the street vendors to get supplies. So they're like a, a B2B company that provides all the supplies. For example, if I'm running a small stall, food stall, I make-

    15. NKNikhil Kamath41:08

        Mm

    16. NNNandan Nilekani41:09

        ... omelets or masala dosa, whatever.

    17. NKNikhil Kamath41:11

        Mm.

    18. NNNandan Nilekani41:11

        Earlier, the guy- And there many of them, right? All over. Earlier, those guys would get up at 3:00 in the morning and go to the market and buy eggs and bread and, you know, spend three, four hours buying stuff, vegetables, whatever. Now, these guys built a app for them to order, and it's delivered to the cart, and they pay with UPI.

    19. NKNikhil Kamath41:33

        Mm.

    20. NNNandan Nilekani41:33

        So this could not have been possible before that. Suddenly, that guy saves three or four hours a day, and then he can spend- he can have a longer day, and he can have higher production.

    21. NKNikhil Kamath41:42

        Mm-hmm.

    22. NNNandan Nilekani41:42

        And that's, that can... That, thousands of, uh, street vendors are using this. So just, I mean, who would have thought about this, right? Or, or this, like Jar, for example, which does daily savings.

    23. NKNikhil Kamath41:52

        Mm.

    24. NNNandan Nilekani41:53

        You know, every day-

    25. NKNikhil Kamath41:54

        Mm-hmm

    26. NNNandan Nilekani41:54

        ... it takes a little bit of money from your account.

    27. NKNikhil Kamath41:56

        Do you think that's a good idea?

    28. NNNandan Nilekani41:58

        Yeah, why not?

    29. NKNikhil Kamath41:59

        Mm.

    30. NNNandan Nilekani41:59

        It was invented by Syndicate Bank-
18. 42:50 – 46:00

    What is Fee Day & Beckn Protocol?

    1. NNNandan Nilekani42:50

       remarkable way to bring everybody in, no?

    2. NKNikhil Kamath42:53

       Hmm. What is FIDE and the Beckn Protocol?

    3. NNNandan Nilekani42:57

       Yeah, so what happened was we were, uh, thinking about how to-

    4. NKNikhil Kamath43:06

       Three of you, right?

    5. NNNandan Nilekani43:07

       Yeah. So, so we had worked on UPI, right?

    6. NKNikhil Kamath43:10

       Mm.

    7. NNNandan Nilekani43:10

       So Pramod, myself, we had all worked on UPI, and we saw how a well-designed UPI protocol-

    8. NKNikhil Kamath43:17

       Mm

    9. NNNandan Nilekani43:18

       ... could unbundle payments.

    10. NKNikhil Kamath43:20

        Mm.

    11. NNNandan Nilekani43:21

        And suddenly everything changed.

    12. NKNikhil Kamath43:22

        Mm.

    13. NNNandan Nilekani43:23

        So we said, "If you can unbundle transactions, then you can create new business models where different people can talk to each other."

    14. NKNikhil Kamath43:33

        Explain what you mean by un- unbundle.

    15. NNNandan Nilekani43:35

        See, let's take e-commerce.

    16. NKNikhil Kamath43:36

        Mm.

    17. NNNandan Nilekani43:37

        Right? How does e-commerce work today?

    18. NKNikhil Kamath43:38

        Mm.

    19. NNNandan Nilekani43:39

        I go to a, some platform, I get an app from that platform, I look up some product on that app-

    20. NKNikhil Kamath43:47

        Mm-hmm

    21. NNNandan Nilekani43:47

        ... from one of the suppliers listed on that platform, who has gone through the checks of that platform, then I order something.

    22. NKNikhil Kamath43:54

        Mm.

    23. NNNandan Nilekani43:55

        And then their delivery agent delivers it to my house.

    24. NKNikhil Kamath43:58

        Mm.

    25. NNNandan Nilekani43:58

        That's how, that's a integrated e-commerce the way it is. But suppose you take this e-commerce transaction and unbundle it, say... And this is like UPI thinking, right?

    26. NKNikhil Kamath44:10

        Mm.

    27. NNNandan Nilekani44:10

        UPI also, it's not everything, my account, your account, my... It's all different. So on my app, I can place an order from any supplier listed on the ONDC grid.

    28. NKNikhil Kamath44:20

        Mm-hmm.

    29. NNNandan Nilekani44:20

        And I can use any delivery agent to have it delivered home.

    30. NKNikhil Kamath44:24

        Would you say ONDC is something built... Is Beckn a protocol on which ONDC is built?
19. 46:00 – 49:10

    Namma Yatri - Something built on top of Beckn

    1. NNNandan Nilekani46:00

       are building something called Unified Energy Interface.

    2. NKNikhil Kamath46:02

       Mm-hmm.

    3. NNNandan Nilekani46:03

       People can buy and sell electricity.

    4. NKNikhil Kamath46:05

       Mm.

    5. NNNandan Nilekani46:05

       So any, anywhere that you have to buy and sell things between different people-

    6. NKNikhil Kamath46:09

       Mm-hmm

    7. NNNandan Nilekani46:09

       ... in a c- consistent way-

    8. NKNikhil Kamath46:11

       Mm-hmm

    9. NNNandan Nilekani46:12

       ... Beckn is the way to do it. Beckn is a way to do it.

    10. NKNikhil Kamath46:15

        So if I want to build something on top of Beckn, how do I go about it?

    11. NNNandan Nilekani46:19

        Well, you have to choose where you want to do it. Do you want to do it in commerce, mobility, financial services? You have to choose.

    12. NKNikhil Kamath46:25

        Let's say mobility. Let's say I want to build something using the transaction protocol, Beckn, a financial... uh, uh, something for, like, transport.

    13. NNNandan Nilekani46:34

        Now, this is what, um, Namma Yatri has done, right?

    14. NKNikhil Kamath46:36

        Mm.

    15. NNNandan Nilekani46:36

        Namma Yatri has built a platform where I can find an auto on Namma Yatri, exactly like I do it on my other platforms, but when that auto comes to me, I, I bilaterally make a transaction and pay the auto, auto rickshaw.

    16. NKNikhil Kamath46:53

        Mm.

    17. NNNandan Nilekani46:54

        And I pay 100%.

    18. NKNikhil Kamath46:55

        Mm.

    19. NNNandan Nilekani46:56

        And I pay immediately.

    20. NKNikhil Kamath46:57

        Mm.

    21. NNNandan Nilekani46:59

        And the... So this is a different from being an aggregator, which is sitting between you and the auto. It's, it's just a- it's more of a discovery place.

    22. NKNikhil Kamath47:07

        Mm.

    23. NNNandan Nilekani47:07

        And the way the platform makes money is that auto rickshaw driver pays a daily SaaS fee to use the platform.

    24. NKNikhil Kamath47:14

        Mm.

    25. NNNandan Nilekani47:14

        So it's a different business model.

    26. NKNikhil Kamath47:15

        When you say he pays a daily SaaS fee, what do you mean?

    27. NNNandan Nilekani47:18

        He pays the, uh, company ₹25 a day-

    28. NKNikhil Kamath47:22

        Mm

    29. NNNandan Nilekani47:22

        ... to use that platform to get, uh, customers, unlimited customers for the day. So unlike in the other previous model, if I pay ₹100, then maybe ₹30 goes to the platform in between.

    30. NKNikhil Kamath47:35

        Mm-hmm.
20. 49:10 – 55:40

    Nandan on Artificial Intelligence

    1. NKNikhil Kamath49:10

       do you think of AI? I've heard you speak of AI in a manner where, uh, you firmly believe that large language models and building a model is going to be commoditized and-

    2. NNNandan Nilekani49:21

       No, it's already commoditized.

    3. NKNikhil Kamath49:23

       Yeah, and nobody should spend energy on that. But you speak a lot for the Indian language and the nuance of it, and building wrappers on top of these models to cater to that. Uh, can you elaborate on that? What do you think?

    4. NNNandan Nilekani49:39

       Yeah. So there's a couple of, uh, two, two, three different points here. One is, large language models, in my view, will become a commodity. They are already becoming a commodity.

    5. NKNikhil Kamath49:49

       Mm.

    6. NNNandan Nilekani49:49

       The drivers for the Western guys to spend billions of dollars is essentially because they're in a competitive land grab situation.

    7. NKNikhil Kamath49:59

       Mm-hmm.

    8. NNNandan Nilekani49:59

       So they all have to invest because not to invest is dangerous for them. So they collectively are investing two hundred billion dollars a year, buying all, you know, chips, putting data centers, AI, all that. But they have to do it, because if they don't do it, they'll fall behind. So that's... They have a compulsion to do it. But the good news for us is, all that is going to lower the cost and access to AI over time. It's, it's already happening. And then open source AI is coming. People like Meta have just launched Llama 3 and, uh, uh, so... And they're going to give it away free. So I think this building a LLM is a mug's game for us.

    9. NKNikhil Kamath50:39

       Mm.

    10. NNNandan Nilekani50:39

        It's, it's great for somebody there, but not for us. Our job is to leverage all this technology in a very low-cost way to deliver value to our people.

    11. NKNikhil Kamath50:49

        Can you give us a couple of use cases?

    12. NNNandan Nilekani50:51

        Yeah, so an Indian language is the use case which we have taken as the, uh, one of the top priorities. Because India, there are twenty-two official languages. There are three hundred or four hundred, uh, many more, thousands of languages, dialects, this, that. And if you really go back to population scale, as we talked about it, how does everybody interact with a computer? To use a keyboard, you need to know English. Even to use a touch screen, you can do visually, but you can't read. But if you can speak to the computer, and if you can speak in your language of choice, your mother tongue, then suddenly you can access the entire knowledge in the system.

    13. NKNikhil Kamath51:36

        Mm.

    14. NNNandan Nilekani51:37

        So the-- It's a dramatic increase in access. So if a farmer in a village in, you know, UP, can speak in Hindi to the computer, and the computer can go and get some information on s- uh, planting techniques to him and tell him in real time back, suddenly we have made the world's knowledge accessible to that farmer in his or her language. So that's why AI is useful to bridge this gap of communication. So that's why language AI is important for India. I mean, AI is going to be like electricity, is everywhere, so everything will have some AI component in. And we are ja- and we are looking at how we can use this stuff to make people's lives better.

    15. NKNikhil Kamath52:20

        Right. Do you think voice will be big? I remember, like, when we were doing broking ten years ago or fifteen years ago, there were systems where you could say by voice: "Buy particular stock-

    16. NNNandan Nilekani52:31

        Yeah

    17. NKNikhil Kamath52:32

        ... X quantity, Y quantity," all of that. It never really took off. But do you think voice-controlled automation is a big use case in the near future?

    18. NNNandan Nilekani52:41

        Well, if you don't know how else to access... I mean-

    19. NKNikhil Kamath52:43

        Mm

    20. NNNandan Nilekani52:43

        ... you may have a choice-

    21. NKNikhil Kamath52:45

        Mm

    22. NNNandan Nilekani52:45

        ... by either saying, "Buy X stock for Y rupees," or by keying in, "Buy X stock for Y rupees." So you have a choice. But the guy who can't read or write, the only way is by talking, no?

    23. NKNikhil Kamath52:58

        Right. So, Nandan, growing up, whenever I thought of artificial intelligence, AI, per se, maybe I was wrong in thinking of AI as AGI, but I thought it's when somebody else can think for me. Whichever model I've kind of used a little bit of, it doesn't feel like somebody is thinking for me. It feels like somebody is executing better what I'm thinking. Do you think it's right to call what we have today AI?

    24. NNNandan Nilekani53:28

        Whatever. Those guys got together some sixty years back and called it AI.

    25. NKNikhil Kamath53:31

        Mm.

    26. NNNandan Nilekani53:31

        Now, we can debate whether the right name or wrong name.

    27. NKNikhil Kamath53:34

        Mm.

    28. NNNandan Nilekani53:34

        But I firmly believe what you said, which is this stuff is going to make our ability to do things better.

    29. NKNikhil Kamath53:38

        Mm.

    30. NNNandan Nilekani53:39

        Certainly not a replacement for what human beings can do.
21. 55:40 – 1:01:20

    What is Finternet?

    1. NNNandan Nilekani55:40

       or health or farming or whatever.

    2. NKNikhil Kamath55:43

       So what is the Finternet? Siddharth has been talking about this for years. I think he told me first about this two years ago or three years ago. What is the Finternet, and why is it so interesting as a evolution of whatever we have today?

    3. NNNandan Nilekani55:57

       Well, in some sense, Finternet brings together the, the traditional, the mainstream financial system that we have, and marries it to the possibilities that cryptographic techniques have taught us. You know, the concept of, uh, blockchains, the fact that everything is on one, you know, uh, chain, uh, immutability of data, and so on. So there, there, there are very some very powerful ideas that the cryptography has brought in.

    4. NKNikhil Kamath56:34

       What is Finternet? What is cryptography?

    5. NNNandan Nilekani56:36

       Cryptography is, you know, the, the fact that you used, uh, uh, all this, uh, technology to m- make things immutable. In the sense, you can ... I- if you create- if you look at a blockchain, everybody can see the same thing, and every change made is also visible to everybody. So it's, uh, it gives you the tools to create, instead of having a s- reconciliation, uh, between you, all of us, that act as a public reconciliation of whatever it is, some transactions. So that's what is used by the cryptocurrency guys. So let's separate cryptography or crypto technology from cryptocurrency.

    6. NKNikhil Kamath57:18

       Mm.

    7. NNNandan Nilekani57:19

       So that capability of immutability of creating chains was used to create Bitcoin and Ether and all these things.

    8. NKNikhil Kamath57:26

       Basically, everybody can see and verify the transactions that are-

    9. NNNandan Nilekani57:29

       Yeah, without any... In the old world or in the current traditional world, you know, there's a, there's a custodian, there's a settlement guy, there's a regulator, all they- they- the, the cryptogra- cryptocurrency guys came from this saying that we don't need authority. S- so when you- if you don't have authority, how do you resolve things? We'll use software to resolve it, and that's the bro- broad theory, right? So but there's a lot of good, very technology there, but that has gone to its own issues. Because when you start building financial system that are not part of authority-

    10. NKNikhil Kamath58:01

        Mm-hmm

    11. NNNandan Nilekani58:01

        ... then you end up with all the, uh, you know, costs of that, you know, money laundering and terrorist financing and all that stuff, and we saw what happened to many of these crypto guys.

    12. NKNikhil Kamath58:12

        Can't that be scammed? Like, whenever I looked at the crypto world, if I were to think regulation is everybody viewing transactions verified either by f- proof of work or proof of stake or even proof of time, uh, if the chain in itself is not large enough, can't it be easy- easily, uh, scammed or conned into going in a certain direction?

    13. NNNandan Nilekani58:36

        I, I don't know enough to answer that, but they took a technology, but on top of that, they layered currency, and they layered ideology.

    14. NKNikhil Kamath58:47

        Mm.

    15. NNNandan Nilekani58:48

        So they said, "We'll create our own currency."

    16. NKNikhil Kamath58:49

        Mm-hmm.

    17. NNNandan Nilekani58:51

        And they created some 15,000 cur- everybody created some coins-

    18. NKNikhil Kamath58:55

        Mm

    19. NNNandan Nilekani58:55

        ... ICOs and all that.

    20. NKNikhil Kamath58:56

        Mm-hmm.

    21. NNNandan Nilekani58:57

        And they said, "We don't want authority. We, we don't trust the state, so we'll do it through software." So that got them into all their own issues. So what we have done is we said, "Look, we should separate all this." There's some great technology here which we can use for high volume, low cost transactions, and if we can somehow bring that high volume, low cost transaction capability to the current world by a common way of doing it, then suddenly we can take our mainstream world and turbocharge it. That's exa- exact- exa- what Finternet does. So Finternet allows you to essentially airdrop like a modern engine into the existing system.

    22. NKNikhil Kamath59:43

        Mm. Which is interoperable in nature.

    23. NNNandan Nilekani59:45

        Which is interoperable. So if it's in the banking system, then I can take a bank deposit, and following certain rules, I can tokenize it.

    24. NKNikhil Kamath59:53

        Mm.

    25. NNNandan Nilekani59:54

        And then I can trade the tokens, like, very fast.

    26. NKNikhil Kamath59:57

        Mm.

    27. NNNandan Nilekani59:57

        And then when I want the deposit back, I can un- convert it back to a deposit.

    28. NKNikhil Kamath1:00:01

        Mm.

    29. NNNandan Nilekani1:00:02

        So the ability to take different kinds of assets-

    30. NKNikhil Kamath1:00:04

        Mm
22. 1:01:20 – 1:04:00

    Rapid Fire With Nandan

    1. NKNikhil Kamath1:01:20

       to ask you some questions, like, really fast answer questions. What do you think of CBDT? Where is it at? What is the future?

    2. NNNandan Nilekani1:01:26

       CBDCs is, uh, uh, is a s- central bank, uh, uh, you know, uh, sort of currency, but CBDC ultimately will be a, one more category in the Finternet.

    3. NKNikhil Kamath1:01:36

       Right.

    4. NNNandan Nilekani1:01:36

       So, uh, y- you need users. I think a big user of CBDC is actually in wholesale.

    5. NKNikhil Kamath1:01:41

       Mm.

    6. NNNandan Nilekani1:01:41

       So when you do cross-country transactions, you can do settlement much faster if you both use CBDCs. So then today's settlement complexities go away.

    7. NKNikhil Kamath1:01:50

       Capital account convertibility, do you think India will change? Is it good that we are in the, mm, like you mentioned, the LRS cap and all of that, will that go away?

    8. NNNandan Nilekani1:02:00

       I mean, again, uh, it's not my decision, but, but I, I believe the trend is it'll go away. In my view, it'll get more and more liberalized because India will get lots and lots of dollars. Already we get $108 billion of remittances that will go to, say, $200 billion.

    9. NKNikhil Kamath1:02:16

       Mm.

    10. NNNandan Nilekani1:02:16

        We'll get FDI, we'll get-

    11. NKNikhil Kamath1:02:17

        And LRS outflow is maybe $20 billion.

    12. NNNandan Nilekani1:02:19

        LRS $20 billion. In- inflow is, you know, $100 billion, just remittance, forget about other things.

    13. NKNikhil Kamath1:02:23

        Mm, mm.

    14. NNNandan Nilekani1:02:24

        So sooner or later, the system will have to liberalize. So... But the way they'll do it is they'll do it progressively.

    15. NKNikhil Kamath1:02:30

        Mm.

    16. NNNandan Nilekani1:02:30

        So they take the LRS cap up-

    17. NKNikhil Kamath1:02:32

        Mm

    18. NNNandan Nilekani1:02:33

        ... or NRIs per year, now they can take a million out. They'll ch- so they'll keep on the edges, liberalizing it, in my view, over the next twenty years. Whether it'll be full convertibility is, uh, is not my decision, it's a political decision.

    19. NKNikhil Kamath1:02:46

        But do you think more will come in and then go out if it were to be-

    20. NNNandan Nilekani1:02:49

        Yeah, because India high growth economy, the FDI will come, FII will come, remittances will come.

    21. NKNikhil Kamath1:02:53

        Mm.

    22. NNNandan Nilekani1:02:54

        So-

    23. NKNikhil Kamath1:02:55

        And crypto, what's your opinion on the crypto world?

    24. NNNandan Nilekani1:02:57

        I, I think, uh, crypto world is, has a lot of issues-

    25. NKNikhil Kamath1:03:02

        Mm

    26. NNNandan Nilekani1:03:02

        ... uh, and, uh, now we are seeing the cost of that. So I think that's where the Finternet is important, because Finternet essentially brings all the technology advantages of crypto world into the mainstream economy.

    27. NKNikhil Kamath1:03:15

        Mm. Over-regulation, under-regulation, what's happening in India today?

    28. NNNandan Nilekani1:03:21

        It depends. I mean, I think, uh, some markets are well-regulated, some maybe under, some over. I mean, it's- there's no, nowhere in the world there's one perfect answer for that.

    29. NKNikhil Kamath1:03:30

        Mm. Where do you think we're leaning on? Which side? Sum total.

    30. NNNandan Nilekani1:03:35

        Uh, I think we are on, on par with... I, I, I really don't know about overall regulation, but certainly on digital regulation, I think we are on par, um, uh, better than most people.
23. 1:04:00 – 1:06:04

    Advice to 20 y/o with funding

    1. NKNikhil Kamath1:04:00

       crore that I borrowed from someone, what do I do?

    2. NNNandan Nilekani1:04:03

       I think, uh, I've never seen so much opportunity.

    3. NKNikhil Kamath1:04:06

       Mm.

    4. NNNandan Nilekani1:04:06

       I think the ability for young people today to create successful companies has never been higher.

    5. NKNikhil Kamath1:04:12

       But I'm confused with too much opportunity. I want you to tell me one opportunity.

    6. NNNandan Nilekani1:04:15

       No, that is... You have to, I mean, you, you have to... There's something called the tyranny of choice.

    7. NKNikhil Kamath1:04:22

       Mm.

    8. NNNandan Nilekani1:04:23

       You know, there's so many things to choose from. You go to a supermarket, there's seventeen varieties of, you know-

    9. NKNikhil Kamath1:04:27

       Mm

    10. NNNandan Nilekani1:04:27

        ... cheese or something, uh, then you get lost.

    11. NKNikhil Kamath1:04:29

        Mm.

    12. NNNandan Nilekani1:04:30

        ... So half of life is doing- deciding what not to do.

    13. NKNikhil Kamath1:04:34

        Mm.

    14. NNNandan Nilekani1:04:35

        So you chip away and, uh, remove stuff from your-

    15. NKNikhil Kamath1:04:39

        Mm

    16. NNNandan Nilekani1:04:40

        ... thing, and focus on a few things. But the opportunity is huge.

    17. NKNikhil Kamath1:04:44

        Mm. Sector-wise, any particular opinion? Like right now, we're hearing a lot of defense is big, energy transition is big. Like, I personally have been researching what to do in energy transition for a year. Uh, any outlook on that sector or any insight that you-

    18. NNNandan Nilekani1:05:00

        No, energy transition is huge. It's going to involve trillions of dollars. But where do investors make money in the private markets is not clear, because energy transition is a big capital game, right?

    19. NKNikhil Kamath1:05:10

        Mm.

    20. NNNandan Nilekani1:05:10

        I mean, uh, building massive, uh, solar plants or stuff like...

    21. NKNikhil Kamath1:05:15

        Mm.

    22. NNNandan Nilekani1:05:15

        So we have to figure out... See, there's two, there's big energy and little energy.

    23. NKNikhil Kamath1:05:19

        Mm.

    24. NNNandan Nilekani1:05:20

        Big energy is the grid.

    25. NKNikhil Kamath1:05:21

        Mm.

    26. NNNandan Nilekani1:05:22

        Little energy is thousands of homes having batteries and-

    27. NKNikhil Kamath1:05:24

        Mm

    28. NNNandan Nilekani1:05:24

        ... rooftop solar. So the opportunity is actually in, in this little energy, where there's lots of players, and how do you make that efficient? How do you create markets there?

    29. NKNikhil Kamath1:05:33

        Right. Yeah, that's it. [upbeat music] Thank you, Nandan.

    30. NNNandan Nilekani1:05:36

        Thank you.

Episode duration: 1:06:04