NPCI’s first real alternate
The Batua Stack
NPCIs success has led to it becoming a monopoly. And that makes it a systemic risk, not just to the banking system but the whole economy. The RBI came up with tenders to appoint a rival way back in 2021 but changed its mind soon thereafter.
NPCI is built on a foundation of an ubiquitous internet. It connects both ways over the internet – upstream and downstream. It is govt supported but is relatively independent. It is a centralised trust based system. Crypto and distributed ledgers are alien to the NPCI foundation. As are secure hardware elements since they chose to operate in the software layer alone. This makes them vulnerable in more ways than they should be.
It is not if NPCI will get cyber attacked but when.
Even the technical resilience of any such high throughput platform cannot be foolproof. It may be 99.99% fault tolerant. But nothing is 100%. Not even NSE or BSE.
Way back in 2012, the IIT Alumni group conceived of an initiative called Batua. It was a short for “Bitcoin architecture & technology for unified payments and applications”. It used a very light cryptography scheme called ECC – which is also used for the ethereum.
Batua figured out rather well that there were a bunch of things that NpCI could not do because of the way they were architected.
The Batua platform has over twenty startups supported by the IIT Alumni Council who cover various aspects of the fintech platform which is trustless, offline, instant and private. This makes it particularly suited to applications like direct benefit transfer, transit payments and digital cash. Since the system is Internet compatible but doesn’t ride on the Internet – it will work even if the Internet is down. The CBDC is a shot in the arm for this platform.
Built frugally at a cost of less than usd 15 million over ten years – this platform will beat NPCI on most metrics other than number of hourly transactions. The overall ecosystem structure is simple. At the top is a umbrella entity called Batua below which resides a cybersecurity arm called Batua technologies. The platform only looks at cybersecurity and authentication. Everything else is done by partner organisations. The platform will let a user travel by public transport without needing a smartphone or access to the internet. It will also allow him to transfer digital cash from one person to another just like you would transfer paper currency. The transfer protocol has a built-in authenticity check for verifying genuineness of the digital currency.
Batua starts beta operations on August 15, 2025. It allows any featurephone or smartphone to act as a POS device securely. It can replace fast tag and the delhi metro card. Unlike all NPCI options, this is a secure chip based solution. It thus has a layer of safety that none of the NPCI solutions have. And most of all, it comes with the depth of expertise of the IIT Alumni community.