Web3 Can Change The Way Financial Information Is Handled: FM Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman on Friday (November 18) said that Web3 will bring sweeping changes to the way financial information is handled.

“When we have to look at technology and adaptation of technology, Web3 is taking over our lives. I think the manner in which financial information is gathered, processed and also reported is going to see a big difference,” Sitharaman said while addressing the 21st World Congress of Accountants.

The 21st World Congress of Accountants is jointly organised by the International Federation of Accountants (IFCA) and the Institute of Chartered Accountants of India. It has been held every four years since 1904 and this is the first time the Congress is being organised in India.

Sitharaman said that Web3 utilities such as blockchain, artificial intelligence (AI), data analytics and cloud computing will give accountants an advantage.

“Machine learning is also going to assist us and improve the accounting process itself and therefore meaningful generation of information to aid decision making is going to be so much more machine-driven,” the finance minister said during her inaugural address.

She said that Web3 will help accountants and financial analysts find solutions to several problems currently plaguing the industry.

“At this time, when the Congress meets, I would think good analytics and talking and discussion on these points would help us find unprecedented opportunities for data analytics to provide us the solutions for some of the issues that dominate transparency and accountability as well,” Nirmala Sitharaman said.

This is not the first time that the finance minister has talked about the use of Web3 for various purposes, including handling finance and accounts. Speaking at the annual general meeting (AGM) of the Indian Banks’ Association (IBA) in September, Sitharaman suggested that banks should use AI and Web3 for fraud detection and other banking-related use cases.

“Use of Web3, data analysis, Artificial Intelligence, deep dive into data – all of these should have some coordination by the IBA. Leveraging AI should be an immediate priority for the banks, especially in fraud detection and generating early warning signs about something going wrong,” said Sitharaman.

She also said that banks can further leverage Web3 and AI for several use cases such as tracking wrong money and detecting unusual transactions within the banking ecosystem.

The Indian government is also trying to promote and use many of the Web3 technologies. Last month, Minister of State for Science and Technology Jitendra Singh said that over 30 Lakh government officials would be trained in the use of AI, machine learning, and blockchain for effective governance and delivery of government services at the doorstep.

While AI and machine learning can detect fraud in GST and income tax returns, blockchain can be used for securing records and certificates, Singh said.

India’s Web3 ecosystem is one of the fastest-growing across the world, with Indian Web3 startups having raised nearly $1.5 Bn between 2014 and Q3 2022. 

With blockchain, metaverse, cryptocurrency, digital currencies, NFTs and various other use cases gaining popularity in India, Web3 is set to be a major opportunity. India is ranked third among the countries with the highest Web3 workforce. Over 75,000 professionals in India are working across 450 Web3 startups and four unicorns, according to a report by Cointelegraph.