View: India’s tech hub Bengaluru can’t deal with SVB if it’s stuck in traffic

India’s software powerhouse earned its spurs by managing tech for global multinationals. Now it’s even shielding local startups from the falling debris in US banking. The city of 13 million people punches above its weight for India and the world.

But while success in solving technical problems has brought prosperity to coders, inadequate infrastructure, particularly transport, is detracting from the quality of life of professionals who call the fast-growing Indian metropolis home.

Once known as India’s garden city, Bengaluru is choking on toxic fumes from cars, buses, two-wheelers and auto-rickshaws stuck in bumper-to-bumper traffic. After London, the city is the second-slowest in the world to drive in, according to a TomTom report. But while the UK’s capital boasts of a massive and well-used underground rapid transit network, Bengaluru’s subway project, which got under way after decades of delay, has suffered from 12 years of stunted growth under various state governments.

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When it comes to the information superhighway, there are no speed limits in the Indian city. Razorpay, a new-age payment gateway, is the fifth-largest economy’s answer to Stripe. It helps businesses receive money online from customers. Last month, the Bengaluru-based firm started getting an unusual query from its startup clients: Can it move their funds in Silicon Valley Bank, or SVB, to dollar accounts in Gift City, the offshore financial center India is promoting in Prime Minister Narendra Modi’s home state of Gujarat?

Indian startups, many of which are funded by US investors, began to worry about the safety of their deposits when SVB announced a desperate fund-raising plan on March 8, triggering a rout in its shares. The bank shut down on March 10, a Friday. That gave intermediaries a rather narrow window of time to find a new home for clients’ cash. “We facilitated $50 million, and roughly the same amount is in the pipeline,” Razorpay Chief Executive Harshil Mathur told me. “We weren’t the only player. Overall, I estimate transfers of $200 million to $300 million.” For customers who failed to act in time, the nine-year-old fintech set up $250,000 credit lines, helping them stay afloat when they opened for business on Monday.

The residents of Bengaluru are also using tech to overcome the onerous burden placed on them by creaky infrastructure, but they’re far less successful in the physical world where they live than in the digital universe where they make a living. Sharing your live location on WhatsApp with the person you’re going to meet is just a fancy excuse for arriving late because of snarled-up traffic. During busy parts of the day, it takes an hour to cover a distance of 20 kilometers (12 miles). And this is when the roads are dry. Last year’s rainy season saw tech-industry workers hitching rides on tractors. With elections around the corner, filling the infrastructure gaps has acquired a welcome urgency. Modi’s party will make an all-out attempt to hold on to power in next month’s polls in Karnataka, the southern Indian state of which Bengaluru is the capital. By all reckoning, it will be a tough contest against Rahul Gandhi’s Congress Party, the main opposition.

Modi recently inaugurated a crucial, 14-kilometer stretch of the Bengaluru metro, one that seeks to connect the suburbs of Whitefield, the city’s first IT hub, with the central business district around Church Street. The only catch is that a small section in the middle is missing. Coming from her home in Whitefield, Nandita Iyer, a doctor and food writer, had to interrupt her journey midway, take a feeder bus and join the same traffic she wanted to avoid. Twenty minutes later, she got off the bus, crossed the road, entered another subway station and finally reached Church Street.

Naturally, the unfinished line is inspiring delightful memes. A particularly clever one has superimposed the schema on Michelangelo’s Creation of Adam. The two unconnected stations appear on the outstretched fingers of God and man. Authorities say the link will be in place by June. People have left it to divine intervention.

At present, Bengaluru, known for its all-year-round temperate climate, is experiencing a strange mix of hot and cold. Political temperatures are rising because of the impending polls, but an icy startup-funding winter is making founders shiver. Tiny ventures are getting money from domestic angel investors, while more mature firms like Razorpay have cash in the bank and a visible path to profitability. It’s the ones in between — those yet to go through their Series A, B, and C — that are in trouble. Blockchain-oriented businesses are in a funk because authorities have turned increasingly wary of cryptocurrencies. With jittery global banks as some of their biggest clients, Bengaluru’s established, publicly traded outsourcing firms are also bracing themselves for a sharp slowdown.

Unlike the perennial shortage of infrastructure, inclement business and financing conditions are a temporary blip. Bengaluru’s economic proposition will keep getting stronger. India’s software hub was never a go-to destination for financial intermediation. But technology — especially the wildly successful payments utility that was conceived as a public good at iSpirt, an influential think tank based in the city — has blurred the boundaries. The $172 billion-a-month online payments industry that has gotten built on top of it is a powerful innovation. Indeed, it may be the only reason why Bengaluru-based companies like Razorpay and Walmart Inc.’s PhonePe have emerged as alternatives to traditional banking, which is still concentrated in India’s financial capital of Mumbai.

For new cohorts of youngsters to keep solving problems both at home and around the world, someone has to make their nine-mile commute a little easier. Otherwise, India’s best-known global success might get crushed by its own growth.