With evolving technology comes several demerits also and one of them is ‘Data’. Often touted as the ‘new-oil’, Data is flowing through the economies of the world by few tech behemoths like Amazon, Apple, Facebook, and Google, who have control over vast amounts of data about their customers, which they use exclusively to make them way ahead of smaller firms or start-up ventures, despite of the fact that the data belong to customers without any exclusivity.
To end this monopoly of tech giants, NITI Aayog, the think-tank of Indian government, is considering a proposal to make consumer data accessible to all, subject to riders, instead of being the exclusive preserve of a few tech firms, reported Economic Times.
According to the report, inability of fintech firms to access data was among the key factors that led the NITI Aayog to come with this step.
As per the proposal by NITI Aayog, an independent regulator with overarching powers will be setup to ensure that no entity has monopoly over data that has been anonymized so that the information can not be tied to specific individuals and their privacy is protected.
Beginning with sectors – banking, e-commerce, health and education, the regulator will be available across sectors and if implemented then information emerging from any transaction — what is bought and sold, borrowings, loans, health and insurance records, assets and insurance policies — will be available and can be obtained by anyone on request.
In terms of technicality, the data will collected from all large companies on a real-time basis in a standard format, which would then be anonymized and converted into indices and trends to reflect consumer preferences.
Data anonymization is a type of information sanitization whose intent is privacy protection. It is the process of either encrypting or removing personally identifiable information from data sets, so that the people whom the data describe remain anonymous.
Aayog had set up five groups that focussed on constraints restricting growth of fintech in India and far-reaching recommendations to help the sector realize its full potential.
The aayog is also keen to promote “Open Banking” system, a new concept in which data is shared through application programming interfaces (APIs) between two or more unaffiliated parties. The system is fast gaining traction across the globe with the U.K. government establishing the Open Banking Working Group (OBWG) already in late 2015 and has now mandated nine banks to enable open banking since January 2018 while Europe has made it mandatory for all banks.
“Indian fintech industry has the potential to solve not just India’s unique needs of financial inclusion, access to credit, limited insurance reach but can also serve as the solution provider of choice for global financial sector to emerge as one of fintech global hubs of choice,” the Aayog said in a statement.