RBI'S ACCOUNT AGGREGATORS FRAMEWORK WILL REVOLUTIONISE FINANCIAL INCLUSION

Last year in September, India's latest financial data-sharing system went live with the unveiling of the Account Aggregators network.

- Ankit Ratan

This launch marked a major milestone in our nation's journey towards enabling financial inclusion for all its citizens. As the government press note said, the network "could revolutionise investing and credit, giving millions of consumers greater access and control over their financial records."

Under this framework, India now has a set of Account Aggregators, a new type of RBI-licensed and regulated entities. Individuals like you and me can choose any of the Account Aggregators to securely share information from any bank or a financial institution that we have an account with, to any other bank or financial institution, provided both parties have joined the AA network.

In other words, AA are a type of data intermediaries that facilitate sharing of financial information in a real-time data-blind manner between regulated entities. Specifically, they enable data flow between Financial Information Providers (FIPS) and Financial Information Users (FIUS). FIPS holds the customer data, and FIUs consume data to offer better service and underwrite loans.

The system currently enables sharing only of banking transaction data (for example, bank statements from a current or savings account) with other entities. Gradually, it will make all financial data available for sharing, including tax data, pensions data, securities data (mutual funds and brokerage), and insurance data. The long-term vision is to expand the AA network beyond financial services to even include healthcare and telecom data.

Democratising Credit