Revolutionizing mobility through blockchain

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As digital technology continues to transform and reshape the transportation industry over the last few years, blockchain as a decentralized distributed technology has been embraced by other fields through various applications. It has found varied applications across banking, financial services, healthcare, e-governance, and voting.

Blockchain has immense potential to solve the most pressing problems of mobility where it can be used by private & public sector to securely share and integrate data across modes of transport. It paves  the path for transforming Mobility as a Service (or MaaS), where a user may access different modes of transport (three-wheelers, bus, metro, train etc.) on a single platform with seamless connectivity. It makes a paradigm shift in redefining the customer needs in terms of service, rather than the mode of transport.

The applications of blockchain in reducing the cost of financial transactions have been implemented across sectors. In India, 80% of our travel is for distances less than 5 km and most of this is through non-motorized modes of transport which may largely be served by walking, bicycle, and cycle rickshaws. In these modes the, transaction size for every ride is small (or nil). Also, people in urban and semi-urban areas tend to use multiple modes of transport to reach their destinations. In this case, it makes sense for using digital payments that are integrated across all modes of transport. But the payment systems of today charge a transaction fee of between 0.5% to 5%. This hampers the faster uptake of digital payments, especially for smaller transactions. Blockchain greatly reduces the cost per transaction as there are no intermediaries involved in the payment system, thus making small transactions of even 1 or 2 Indian rupees ($0.014 to $0.028) digitally feasible.

The mobility revolution in India is spearheaded by the concept of shared mobility. It is slated to grow at much faster rate with the shared miles contributing 35% of total travel by 2030, as predicted by Morgan Stanley in a recent report. Car/Bike/Scooter sharing & leasing, car-pooling, and ride-sharing would be common expressions of MaaS in the coming years. This requires interaction of the multiple stakeholders: the customers, the drivers, the vehicle owners, transportation network companies, software vendors etc. It is essential to create trust among different stakeholders for the shared ecosystem to flourish. Blockchain essentially solves this problem by creating an immutable digital identity of every stakeholder, along with recording of every transaction in a distributed ledger which cannot be tampered with. This would make sharing of assets and rides much easier as the level of trust greatly increases among the stakeholders.

Another aspect of shared mobility which requires extensive attention is the aspect of safety, most importantly the safety of women, along with vehicle and ride safety. Blockchain can be used to create a framework for safety where the stakeholders can access and share relevant records at ease. Take a case of ride sharing, where one wants to know whether a driver has gone through police verification, has pending challans in his name or the vehicle has all necessary documents. Blockchain provides a framework where these can be accessed and updated at a single tap by different stakeholders.

Globally, countries are ambitious for electric mobility and India is envisaged to spearhead this revolution. Electric mobility would revolutionize the landscape of mobility that we see today. The paradigm shift of electric mobility hinges on the backbone of digital ecosystem. The recent progressive notification of Ministry of Power clarifying that sale of Electricity for EV would be treated as a sale of service, would pave the way for public & private service providers to set up charging stations network across the country. The digital payment systems powering these charging stations need to be integrated, secure and low-cost. Blockchain will help build these solutions which would allow users to make digital payments across different service providers seamlessly.

New technologies have always attracted the attention of entrepreneurs, investors, corporations, and government agencies. Any new technology must be able to make lives simpler and efficient. Blockchain has the potential to finally empower Mobility as a Service (MaaS) and bring it to reality. But today, it is in a similar stage where the internet was in the early 90s. India must give blockchain technology time to mature and utilize it to the fullest.

The views and analysis expressed in the paper/document are personally those of the author. They do not reflect the views of NITI Aayog. NITI Aayog does not guarantee the accuracy of data included in this post, nor does it accept any responsibility for consequences of its use.


Abhishek Saxena

Young Professional, National Institution for Transforming India (NITI Aayog)

Shikha Juyal

Economic Officer, National Institution for Transforming India (NITI Aayog)

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