National Payments Corporation of India: Cutting-Edge Fintech Ecosystem Innovation in India
(9 pages of text)
In recent years, India had experienced a digital revolution, emerging as a forerunner in cashless payments and, in the process, dramatically raising the level of financial inclusion in the country. The National Payments Corporation of India (NPCI), established in 2008 with the mandate to improve national payment systems, became a global gold standard for facilitating innovative financial technology (fintech) solutions. NPCI was created as a not-for-profit “coopetitive” organization, initiated by India’s central bank, the Reserve Bank of India, but owned by a consortium of India’s leading banks and largely run independently. While NPCI’s success in devising an open innovation platform had led to a new competitive playing field, it had also raised the question of whether or not its original coopetitive organizational design was still suitable for sustaining the flow of fintech innovations.
The case is best suited for undergraduate- and graduate-level students in courses on general management or strategy, international business, and economics and public policy. This case explores how a private not-for-profit co-opetitive firm was able to drive innovations in the fintech infrastructure sector. It discusses the various components of the organization design that were instrumental in its success, as well as environmental factors. The case also discusses how a maturing market can pose challenges that might require the firm to alter the organization structure. After working through the case and assignment questions, students will be able to understand the following:
- How the government can act as a catalyst for market infrastructure creation through innovative public/private arrangements.
- What type of organizational design can provide the right incentives for competitors to jointly build an underlying infrastructure that can benefit all.
- When a co-opetitive organization may need to redefine itself as players and rules evolve.
- How fintech solutions can improve financial inclusion in emerging markets.
- How the cashless payment revolution in emerging markets can democratize financial services.
- How an emerging market can become a global benchmark for digital payment.
Economics & Public Policy
Finance and Insurance
India, Large, 2020
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