Note: As part of the Central Bank of the Future research project, we asked a few people to help us think big in reimagining the Central Bank of 2070. What underlying assumptions would have to change to foster economic inclusion? This post is the third article in our "What If...?" blog series.
Brad woke up with a feeling of foreboding on Saturday morning. The moment he checked his phone, it turned out to be justified. He had been laid-off.
He’d been expecting it for a while, truth be told. His specialty was more old-school full-stack coding, and his employer had been getting more “nocode” projects lately. With the economy slowing down, it was no great surprise that they’d let him go.
As he glanced through the termination notice, his mind wandered back to the first time he’d been laid-off, back during the great Coronavirus pandemic of 2020. As a young Gen Z engineer working at a U.S. startup, the whiplash from planning IPO parties to being unemployed was extremely disorienting. He didn’t have much in the way of savings back then, and filing for unemployment had felt so demeaning, especially as he had to don a mask and wait in line to hand in a paper form.
“Alexa, what was my gross pre-tax income in the last 6 months?” Brad muttered.
“Good morning Brad. Your income was 2,078,928 Rupees including this month’s paycheck,” Alexa responded in her ever-pleasant voice.
“I’ve been laid-off as of today,” Brad growled.
“I am sorry to hear that Brad. In that case, your gross pre-tax income for the last six months is 1,998,970 Rupees, including the severance payment you just received.”
For a second, Brad toyed with the idea of just having Alexa file his unemployment application. But he was old-fashioned, and still preferred to use mobile apps for complex things. He reached for his phone and started tapping.
As he got out of his shower later that morning, Alexa spoke up again.
“Hello Brad, your unemployment insurance claim has been processed, and your daily payment of 7,996 Rupees has been deposited into your WhatsApp managed wallet.”
The speed didn’t surprise him anymore, except when he stopped to think about it. Back in 2020, the world was very different. His first unemployment payment had taken 6+ weeks to show up. The whole U.S. financial system worked that way of course. He’d been using a bank account at a credit union, but he’d switched to Chime that year after struggling to electronically deposit his unemployment check.
Checks! Wow, now that was a blast from the past. He hadn’t even seen one for years. Not since his last trip to New York when his dad had given little Max a check as a birthday gift. The 3-year-old had been as excited by that as his visit to the Museum of Natural History. Thankfully Alexa had been able to find an app that would actually deposit the damn thing. Still took a couple of hours for the deposit to show up, but at least it got done. His dad told him that he still used checks regularly!! He’d been so shocked that he’d looked it up, and yes, there were still billions of dollars of checks being processed in the U.S., even in 2035. It had dropped off steeply after the Fed launched FedNow, but even 12 years later, it was still far from zero.
He’d gotten his dad on WePay after that, and now those little red envelopes showed up virtually every June, thank god. And Max could pop them into his favorite app and start playing immediately.
Things had changed so much in the 15 years since the Great Covid Crisis of 2020. Now that was a year for the history books. Every month that year had felt like one of those old Home Shopping Networks commercials: “But wait! There’s more!!” By the end of the year, he had been seriously wondering if the U.S. was going to collapse like a banana republic. It hadn’t of course, and 2021 had been almost as good as 2020 had been bad.
But in many ways it had marked the beginning of the end for the U.S. Oh sure, it still had a UN Security Council seat, and one of the most powerful militaries in the world. But the U.S. had completely missed the opportunity to re-make the global financial system in the 20s. And with Europe struggling with the great Sovereign Debt Crisis, maybe it was inevitable that Asia would become the center of the global financial system. If only the Fed had been forward-thinking like the Asian central banks in the AMF consortium, maybe the dollar would have remained the global currency, instead of being eclipsed by the Rupee.
Now that was a master-stroke by the Chinese government. It felt like a bolt from the blue, but the Chinese and the Indians quitting the IMF, and getting together to build a new global central bank had totally transformed the world. Nobody trusted the Chinese of course, especially after the COVID mess and the Second Sino-Indian war. But all the tech was Indian, and so was the currency. Once the Chinese combined “One Belt, One Road” with the Indian UPI system and put all their resources behind it, the rest of Asia quickly fell in line. And with the U.S. struggling with its crazy political gyrations and the aftermath of COVID, the IMF’s moves to make SDR a global currency had gone nowhere. Even Facebook’s Libra had gotten more traction than that. I mean, the IMF was still run by a European, although at least now it was a Turkish woman. Now, of course, the whole world was on the AMF platform, except for the U.S. and the UK.
Talking about the AMF platform, he really should switch to a better app to manage his newly-constrained finances. He’d been sticking with WhatsApp because he was comfortable. But it really was high-time he moved to a more modern app.
“Hey Alexa, what’s the best app for managing my money right now?”
“PhonePe is the highest rated money management app. Unfortunately, it cannot process U.S. dollar transactions directly, and you average 1.4 U.S. dollar transactions per year. Among apps that can handle US dollars, TransferWise is currently the highest-rated. You currently use TransferWise for all your U.S. dollar transactions.”
It was irritating that the U.S. still wasn’t part of the AMF network. He briefly toyed with the idea of switching everything to TransferWise, but he knew his wife was a PhonePe user. She was the main breadwinner now, so that probably made more sense.
“Alexa, switch my money from WhatsApp to PhonePe.”
“Brad, I am going to switch your core AMF account to PhonePe, move all your Rupees, Euros, Libra, and Yen, and switch in-coming and out-going payments. PhonePe does not support U.S. dollars, so should I leave that with WhatsApp or move it to TransferWise?”
He thought about that for a second, but it really didn’t make much sense to hold dollars given how little time he spent in the U.S. The U.S. would always be home for him of course. He missed it terribly, especially when he face-timed with his parents in the winter and they were up on the slopes. The West Missouri virus had prevented him from visiting his parents for a couple of years now. Still, walking around downtown NY with his dad in VR was a decent replacement.
“No, Alexa, go ahead and convert my U.S. dollars to Rupees.”
“Should I use TransferWise for that, Brad?”
“Well Brad, your core AMF account has been switched. You also qualify for a special PhonePe offer since Sudha is also on PhonePe. If you link your account with hers, PhonePe will reward you with 2,000 Rupees once you spend 10,000 Rupees.”
“Go ahead and link Sudha’s account.”
“Done. Sudha has pre-authorized you, so your accounts are now linked”
Had she known that he would eventually switch to PhonePe, and just been waiting all these years for him to get off WhatsApp? They had talked many times about moving from Malaysia back to India. Her job involved a fair amount of travel, and Max would love being closer to his grandparents in Bangalore. Max loved New York too of course, but realistically they could never move back and live in the US anymore. Even if his wife agreed to put up with the racism, the idea of having to open an account at a bank, wait hours at a time to transfer his relationship between providers, lose the ability to sync his data and his money all in one app, even just the instability of the dollar versus the Rupee - all of it made the idea of moving back to the U.S. impractical.
“Dadddddyyyyyyyyyy. कहा हो तुम”
The cry startled him out of his reverie, and he rushed to get his clothes on. The kids needed to be fed, the house wouldn’t clean itself, and as soon as his wife got back home he wanted to take her out to lunch.
He really needed to talk to his son in English more often, he thought as he popped his head into his son’s room. After all, large parts of the world still used it as a lingua franca.
“चलो बेटा, नाश्ते का समय हुआ”
- Shamir Karkal is the CEO and a co-founder of Sila, a payments fintech startup. He also co-founded Simple, and was the previous head of the Open Platform of BBVA.