Privacy Enhancing Technologies (PETs) : Tools to usher in a new era of Secure Banking

Tools to usher in a new era of Secure Banking

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Abhijit De Chief Manager (Research) State Bank Academy Gurgaon

The banking sector in India has witnessed unprecedented levels of technology integration during the last two decades. The digital transformation has been profound, marked by the proliferation of mobile banking, UPI transactions and digital lending activities. Technology has helped banks reach even the remotest part of the country. A large section of the population which was considered un-bankable could be brought under the fold of formal banking because of the use of technology.

As use of technology in banking continues to grow, concerns around increased risk to consumer data privacy and security have intensified. Addressing these concerns has become a central focus for bank management. Added to this, banks in India also face the imminent challenge of meeting the requirements of India's flagship privacy law -The Digital Personal Data Protection Act (DPDPA), 2023.

To effectively manage the complexities of data protection norms, major banks are taking help of technology solutions such as Privacy Enhancing Technologies (PETs). PETs are a bunch of technology tools which help in ensuring secure and responsible use of "personal data" at various stages of the data-use lifecycle. These tools act as enablers for effective implementation of the principles of data protection and aim at minimizing the risk of misuse of personal data. It is anticipated that huge investments in PETs will be required to be made by banks and other financial institutions once the government finalizes the operational rules/guidelines and timelines for compliance under DPDPA.