Digital revolution, financial infrastructure and entrepreneurship: The case of India

Abstract

This paper examines two aspects of the digitalization of finance in India, which has been surprisingly robust and fast growing. Much of this success is due to the government's introduction of a biometric identity known as Aadhaar. Because financial transactions require definitive proof of identity of the transacting parties, Aadhaar provides this proof without any document via biometric verification, thus greatly facilitating electronic transactions. The paper also documents the impact of digital financialization by showing examples of entrepreneurship, both directly in the fintech space through the creation of new web-based services as well as the rise of new businesses that make use of the fintech infrastructure that has been created.