A lot of interesting concepts were discussed at the Global Technology Summit held recently in December 2016. It had been organised by the Indian Chapter of Carnegie Endowment for International Peace which is Carnegie India.
The Global Technology Summit is particularly important at this point of time as it holds relevance while we strive to move towards a cashless economy particularly: digital currency.
The topic of a Digital Currency Regulator (“DCR”) came up for discussion, and therefore we need to know more about the roles and regulations such a regulator would be involved in.
The Monetary Authority of Singapore (“MAS”) is a model to be learned from, specifically in this context.
What is the typical role of a DCR? What does it do differently?
Around the world it has been a convention to put out white papers inviting suggestions, advice and criticism from the general public and all stakeholders. While the needs and pace of the technology industry is quite different, traditional or conventional model of public participation do not serve to create efficient outputs.
MAS innovatively puts entrepreneurs, MNCs, Governmental Authorities and Regulators together in touch through different events and programmes. MAS organises safe virtual environments where softwares are allowed to run and mimic real life interactions. In a nutshell, MAS helps entrepreneurs test their ideas in a sandbox and makes it easier for regulators to approve or deny technology innovations when it comes to Digital Currency.
Here Banks and other big corporates regularly share the bottlenecks they want to overcome in their businesses and Developers and Entrepreneurs have ready access to an ecosystem where they can constantly solve problems.
The best part of such collaborations is that regulations can be effected instantly and before any new technological standard hits the market. The Government can keep a tab on all latest inventions and discoveries without investing a tonne of sweat.
MAS has effected a lot of changes recently, particularly on the rules of outsourcing, cloud hosting, Applications Programming Interface and Open Source Programming.
While developing new technologies startups have to face lack of incentives in terms of finance, growth prospect, regulatory interference, etc. While some technologies take governments by storm, some very innovative ideas are never heard of.
For e.g. no country still perfectly knows how to handle Uber, while alternative technologies for e-signatures like Blockchain could not find adoption in India yet.
Recently National Payment Corporation of India released advisory instructions to banks for enabling the Universal Payment Interface. Such recourse would not have been necessary if Banks and Regulators were kept in constant touch with Entrepreneurs and Developers.
The platform created by MAS invests in learning of disruptive technologies and constantly creates challenges and incentives for developers to explore more. But unlike Singapore, India does not have a regulator like MAS.