Sumandro Chattapadhyay (The Centre for Internet and Society)

At an event organized by The IndUS Entrepreneurs in August 2015, Nandan Nilekani offered this provocation: ‘are we at a WhatsApp Moment in finance?’ In this paper, I explore the meaning and significance of the notion of ‘WhatsApp moment’ in Indian banking, and document how the conditions of actualization of this moment have been produced through a series of policy-legislative changes on one hand, and introduction of enabling software infrastructure for digital payments on the other.

I argue that the ‘WhatsApp moment’ refers to the _unbundling_ of an industry. Here, unbundling indicates at breaking up of an industry into separate constituting parts that can then be turned into independent, and often differently regulated, sub-industries of their own. In the Indian banking context, I study how (digital) payments as a service formerly offered by established banks and some telecommunication companies got separated out from the larger industry of banking and financial services to become an industry in itself, which saw rapid entry of various new payments processing companies – from Alibaba-linked PayTM, to payments apps from e-commerce giants (Amazon Pay and Walmart-owned PhonePe), to payments apps from mobile device/OS companies (Samsung Pay and Google Pay).

I trace how specific changes in policy design (for digital financial inclusion) and technological design (of national payments systems) came together to reconfigure the digital payments market in India and to produce a newly regulated marketplace of competing digital payments players. This techno-legal redesigning of the market for digital payments services has led to general deregulation but not without introducing various regulatory controls(-by-design). I will conclude the paper with a discussion of these controls and their implementation through technical/legal design decisions, and contradictions thereof.”