Account aggregation system has brought a sigh of relief to the people in India, looking at the fast pace of life and lack of manageability. Generally, people have separate accounts for every purpose. One for savings, one for investment, one for loan repayment, etc. This is how they switch to multiple accounts for multiple purposes. For this, the Reserve Bank of India (RBI) has introduced a new framework of account aggregation India, which is a framework to ease the process of managing bank accounts. This initiative is taken with the thought of improving financial management and services for the financial institutions.
What does the Account Aggregation India Framework do?
The account aggregation system creates a platform where the customers can insert all the financial account details. The system then regulates the data and compiles it to a single platform where the entire financial status can be observed. This eases accessibility to the financial information of several accounts and transactions at once, leading to better decision making.
However, RBI has introduced certain laws to ensure optimum privacy and security. Here are some of the following.
Laws for Account Aggregation India introduced by RBI
The core purpose of account aggregation in India is to regulate users’ financial information for better accessibility and decision making. For this, RBI has also introduced certain laws for better framework and functionality and to overcome security concerns.
The Reserve Bank Of India Directions, 2016 (Account Aggregator)
This is the first and primary regulation created by RBI regarding the account aggregator framework. This lists the business entities and financial authorities on the basis of the eligibility criteria to be a part of the framework. It includes the rules for eligibility, the operational guidelines to be followed for being a part of the account aggregation India, the commitment to the rules of the framework, and the related obligation for giving the financial data for the account aggregator.
The Personal Data Protection Bill, 2019
This bill is still under completion, but it majorly focuses on maintaining the privacy and personal data of the entity and financial institution. The bill under the account aggregation India initiates several provisions that focus on the security concern of individuals. The provisions are about the collection of transactional information, storing the data under security head, processing the data of all the financial institutions to bring it into one dashboard and transmitting the sensitive information from different financial backgrounds.
The Information Technology (Reasonable Security Practices And Procedures And Sensitive Personal Data Or Information) Rules, 2011
This is one of the technological upgrades where the entities are mandated to follow all the security practices and reasons. The practices under account aggregation India majorly target the storage of personal data, following the relevant obligations, collection of financial information, transmit of sensitive and personal data etc. The entities are obliged to follow security concerns for a smooth and ethical financial process.
The Payment And Settlement Systems Act, 2007
The name of the law says enough. This law is for governing the payments, transactions and the financial settlements made by the entity. In this, the payments and settlements are taken into supervision under the settlement systems in account aggregation India. The provision of this is mostly associated with authorization, operation, and oversight over the payment systems including the account aggregator.
The Reserve Bank Of India Act, 1934
This act particularly establishes the Reserve Bank of India. It gives it the power and authority to supervise the financial institutions of India, and to regulate the laws for the same. This is for every entity, including the ones under the account aggregation India framework.
The Prevention Of Money Laundering Act, 2002
This act ensures national security by helping to detect and avoid terrorist financing in India and any cases of money laundering. This law consists of many provisions under it where the entities have to share the relevant financial transactions and information. This will help to detect any suspicious financial transactions.
These laws have added to the convenience of both the RBI system and the entities. Here is how:
Better Financial Management
Now, users do not have to travel poles to post to multiple accounts to measure the financial status. The account aggregation India forms a dashboard gathering all the information from various accounts. Users can get every information on-board leading to improved decision making.
Customers have access to multiple transactional information on one go. They can detect and calculate everything with the financial dashboard available. Since the regulations help to acquire relevant financial information, it gives more transparency to the transactions. Also, it gives more accountability to the banking sector.
The account aggregation India services are provided by regulated and licensed third party providers. This is the biggest perk of the laws given by the RBI because it focuses on privacy concerns and security of consumer data. This helps to eliminate the associated risks of money laundering or mishaps with finance.
The system for account aggregation in India helps users to compare information from different banks. Consumers can even think about switching to various financial services and accounts based on the privilege they can get. This increases competition among the banks too, leading to the advantages of better interest rates, services of the customers and fees.
This is how account aggregation India is one of the best ways to secure financial information and continue with solid decision making. For this, there are several online platforms assisting with the account aggregators. One such place is Anumati, guaranteeing top-notch financial services throughout. Make your financial status safe, secure, and growing with the ultimate service available. Give the relevant financial credentials to this online platform, which will access ahead only after permission. It is in your hands to give the information that you find helpful for the long run and that can assist with financial decision making. After this, it is the responsibility of Anumati to help you sort your economic backdrop.
Also read: How rbi account aggregator framework can work for you