Reserve Bank of India (RBI) is faced with requests from large corporates—mostly corporates based in India, including fintechs—on how they could access the rich data of the Unified Payments Interface (UPI), the best performing real-time payment system in the world,Deputy Governor T Rabi Sankar said on Monday.
Such a request has come from both large fintechs and even non-fintechs, Sankar said on the sidelines of a NCAER event in the capital. Access to UPI data is expected to help large corporates, especially fintechs, structure products for specific target segments of the population. UPI, developed by NPCI in 2016, has been a runaway success, with the monthly value of transactions surpassing ₹ 10 lakh crore and merchants in over ten countries now accepting UPI payments.
Asked if the central bank will accept the large corporates’ request to access UPI data, Sankar said that one would have to wait for the law, but something like a data protection bill—which was recently withdrawn by the government—needs to be in place for large-scale usage of data.
“I don’t know …I have no idea. We have to check what the conditions are subject to which data will be shared. First of all, the data is not owned by RBI. How the data will be used, who will access it, whether it will be allowed.”
I am just saying requests have come and businesses are looking for data as data is important. If businesses had more data, they could design more products,“ Sankar said.
Earlier, in his remarks at the NCAER event on financial inclusion, Sankar highlighted that India is “extremely data-rich” as digitalisation is growing at a rapid pace and noted that corporates want to “access your data” because that will give them information which can be used to structure products that can be targeted at specific segments of the population.
“Data means money. Data can be monetised. Therefore, data has significant value to a business. But at the same time, we will have to have regulations in place…primarily have laws in place, followed by regulations which ensure that customer data is not only safe, that customer privacy is not only protected, but the monetisation of customer data is done in a responsible manner,” he said.
He added that it is to be done in a manner where the customer is aware that the customer has some level of consent, some level of comfort with the use of that customer’s data.
Being data rich is obviously a boon in the sense that new products can be developed, but at the same time, being data rich also increases the responsibility on the government and the regulator, Sankar added.
RBI Deputy Governor Sankar’s latest remarks assume significance as there is now a legal vacuum on data protection. It also comes on the heels of IRCTC scrapping its plans to monetise the data of its passengers. This had to be scrapped due to heavy public protest.
There are two types of data: personal data, which without user consent cannot be shared; The other is public data, for which there is a need for a community protection law.
What the corporates are mainly looking for is anonymised aggregated community data, which should be shared as it has great value in facilitating financial inclusion by fintechs, sources said.
Last month, the government withdrew the Personal Data Protection Bill from the Lok Sabha and IT Minister Ashwini Vaishnaw later said the Centre was hopeful of getting the new legislation passed by the next Budget Session of Parliament.
Meanwhile, on the suggestion to share UPI data with corporates, Mridul Saggar, IEPF Chair professor at NCAER and former ED at RBI told BusinessLine that the suggestion will require deeper examination as the India stack model was based on data democracy where those individuals to whom the data pertains have to provide consent for its any usage. Data is money akin to gold or oil and cannot be monetised just like that. “Even if consent exist it will need to be carefully assessed if the consent has been given with full understanding and not through micro-prints that are glossed over. The issue requires a deeper study”, he said.