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Finternet
Context:
Nandan Nilekani, Infosys co-founder and chairman, has coined the term ‘Finternet’ to describe the future of financial systems, offering a vision of how India’s fintech landscape will evolve.
About Finternet:
- Finternet is defined by three key principles: it is user-centric, unified, and universal.
- This approach keeps the user at the centre, integrates various asset classes, and combines the strengths of regulated financial systems with the potential of tokenisation technology.
- The concept of Finternet leverages tokens to enable universal interoperability and composability.
- The new financial system will bring together diverse assets—such as land, property, bonds, financial investments, art, and paintings—under a single infrastructure where they can be tokenised.
- This system will allow everyone to participate and control various types of assets, including user-controlled assets, NFTs (non-fungible tokens), certified adjusted assets, registered assets like land, and regulated financial products.
- A non-fungible token (NFT) is a digital certificate of ownership that signifies a specific digital or physical asset.
- Unlike fungible assets, which are interchangeable—such as dollar bills or cryptocurrency units—an NFT is unique and cannot be replaced with another. Each NFT, akin to an original painting, possesses its own distinct value.
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India’s Digital Financial Revolution: A Prelude to the Finternet India’s digital public infrastructure has set the stage for a more inclusive, efficient, and innovative financial ecosystem. Its key elements of it include Aadhaar (a biometric-based digital identity system), Unified Payments Interface (UPI) (a real-time payment platform), Account Aggregator Framework (a consent-based data-sharing system) and Direct Benefit Transfer (DBT) (a system for directly delivering government subsidies to beneficiaries). |