How this entrepreneur’s SIM overlay solution will help “Bharat” grow and mature to a digital economy

Taron Mohan- Co Founder NEXTGEN Telesolutions

Interview with Serial entrepreneur & Technology geek Taron Mohan, Co Founder NEXTGEN Telesolutions

The government’s recent 5G auction met with an unprecedented success with private telecom players setting aside massive war chests for the investments in the world’s most advanced data and voice services.

From online shopping to payments to online learning, every activity would be way faster than what we currently experience.

Around 700 million mobile phone users of our one billion plus mobile phone population will easily migrate from their current 4G to 5G band in one year, thanks to their smartphones.

The rest 300 mobile phone users who use feature phones due to many reasons such long battery life, affordability and security, among others will continue to be outliers in the 5G mega universe.

Experts have many a time cast aside this humble tribe as relics. But there are new age entrepreneurs like Taron Mohan, an IIT alumnus, who has

embraced the unlikely resilience of the humble feature phone. His company NextGen Telecom Solutions plans to enable a secure, simple, safe and a trusted digital financial inclusion ecosystem for these feature phone users who represent ‘Bharat’.

In an exclusive interview with Sugarmint, Taron Mohan explains how his SIM overlay solution will   help “Bharat” grow and mature to a digital economy and be a formidable contributor to country’s GDP.

When every start-up in the telecom or fin-tech space is dabbling in everything to do with smart phones , you have chosen to tread an uncharted path . You must have eyed opportunities. Please highlight them.

Taron Mohan: The opportunity in this untapped segment of the unbanked, underbanked user segment who have been left out of the mainstream “digital financial inclusion” is huge.

Its about 350+ million in India alone, another 350+ million in SE Asia including Pakistan, Sri Lanka, Bangladesh and Indonesia, over 1,200+ million in Africa and more in South and Central America.

What they lack is a basic daily access to a financial transaction platform, which is simple to use on a feature phone, secure and is in their local language.

The services they are looking for are access to banking / wallets, bill payments, merchant and individual money transfers, micro finance services for EMI payments and a ”pull payment” from the micro lenders.

This was the background to our unchartered path for development and the product build. The edge here was then a strong IP / tech protection on the product which limits competition and gives us the edge over the regular fintech players.

What challenges would you have to encounter to achieve the targets?

Taron Mohan: Well, those are numerous. Acceptability of the technology by the financial regulator, the handset vendors and the telecom network providers was the biggest challenge.

As this is a thin film secure element based chip, installed over an existing SIM card and both together inserted into the phone SIM slot, there was resistance from everyone.

We finally managed to get past them all. Building the technology on this “SIM overlay” with the data security protection, encryption and then doing it all over a single transaction SMS was a challenge.

The chip is very small and needed a lot of testing to build what we wanted and the way we wanted it to work. Building a financially workable model to accommodate the cost of this “SIM overlay” to a user segment where everything is “free” or the financial capability is limited.

The model needed to make it affordable for them. And building a physical distribution channel for customer on-boarding, education, training and helping them learn “transactions” and then use the services.

This involved partnerships across multiple partners and “stitching” it all together. And convincing a Payment Services Partner / Micro finance partner to actually do the pilot and experiences the on-ground results with their customers and helps us fine tune the services.

We did manage to resolve all the teething issues and are finally ready to take it on a large scale across the nation.

Our next step to overcome will be to convince the governments for the national ID / health certificate hosting on this chip and the financial regulator for extending this to the offline stored wallet transactions and Central Bank Digital Currencies ( CDBC).

Last year RBI announced UPI on feature phones. Will your business be different from that or dovetail with RBI ‘s measures.

Taron Mohan: Yes, this solution dovetails into the RBI/NPCI announced 123pay UPI services on feature phones and does take care of the full ecosystem of service offerings for financial inclusion / micro finance service verticals.

And we also incorporated a simple to use, secure and safe platform in the user local language, making it a preferred platform for the 123Pay services with UPI for a feature phone user.

In your business that deals with microfinance, government approvals are necessary. How has that support been ?

Taron Mohan: Yes, the support has been good, with the government / regulator realising that it is this user segment that needs to be digitalised, and is the next vacuum to be filled for the UPI growth.

And the approvals are in place from the multiple agencies to kickstart the first pilot project with a micro finance company in Tamil Nadu.

They are all looking forward to this pilot and its outcome. The next step would be to extend this payment facility the 70-80 million feature phone beneficiaries in the micro finance ecosystem.

We are at the cusp of big tectonic shift that will change the usability of the feature phones and digitally empower millions.

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