News & Analysis

Would RBI Sell UPI Data To Corporate Entities?

Many fintech and even non-fintech companies are approaching the central bank, but decisions aren't yet taken says a top official

The RBI is receiving several requests from enterprises in India, mostly businesses in the fintech space, for data emanating from the government’s prestigious unified payments interface (UPI) which has over time developed into the best performing real-time payment system in the world. However, no decisions have been taken yet, says RBI deputy governor T Rabi Sankar. 

The official told the media on the sidelines of an NCAER event in New Delhi that data requests came from both fintech and non-fintech entities. This isn’t surprising as data from the UPI could help these companies structure products based on target segments and usage. 

However, Rabi Sankar was clear that the RBI would not be entertaining such requests till such time as there was a clear law governing data usage from such sources. We believe he was referring to the data protection bill that had recently been withdrawn by the government and is now scheduled to be re-presented to Parliament in the Winter Session. 

“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 the RBI. How the data will be used, who will access it, whether it will be allowed,” the official said, adding that he was just making the point that such requests kept coming as enterprises required data to structure their products. 

During the actual event around financial inclusion, the RBI deputy governor said India already is a country that generates vast amounts of personal data, which keeps growing as digitization spreads into the smallest of small towns and villages. Companies seek this data as it could provide them information used to target 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,” the official said.

Rabi Sankar said while being rich in data sources was a boon for an economy, it was also an added responsibility on the government and the regulators. The official’s latest comments assumes significance due to the upcoming data protection laws as well as the fact that IRCTC had to scrap plans of monetising passenger data following a public outcry.  

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.

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