FINANCIAL INCLUSION - NEWS AND VIEWS - JANUARY 2018
The year 2017 was all about consent!
With payment apps taking over our phones, and with digital banking, fintech, open banking becoming the latest buzz words, the progress of financial inclusion critically rests on how financial service providers will set up their consent architecture. This is not a hypothetical conjecture, but a reality that has already unfolded in front of us. Airtel Payments Bank, the first payments bank to be licensed, made the headlines for all the wrong reasons – it has been fined, and its Aadhaar-based eKYC rights curtailed, for opening bank accounts without customer knowledge. See Airtel can do eKYC till 10 Jan with riders (Business Standard, December 22, 2017), Airtel repays Rs 138 cr of DBT amount (Hindu, December 22, 2017).UIDAI has now expressly stated what should have been obvious from the start - users' consent must for changing bank accounts to receive subsidies (Mint, December 20, 2017).
The Supreme Court ruling on the right to privacy as a fundamental right has its implications for financial inclusion, as detailed by Malavika Raghavan(EPW, Vol. 52, Issue No. 51, 23 Dec, 2017). While the final hearing on Aadhaar PILs is scheduled for January, the Supreme Court has pushed the deadline for linking of Aadhaar to various government services and bank accounts to 31st March 2018. Also, the date for public feedback on the White Paper of the Committee of Experts on a Data Protection Framework for India has been extended till January 31st 2018.
The Airtel case, the Supreme Court judgement on privacy and the ongoing consultation on data protection all highlight the lesson for the year – banking and financial inclusion may be managed through technology but in the end, they are built on trust.Till the appropriate framework and legislation for consent architecture evolves over the year ahead, we can hope that consent will not be taken lightly by the government or industry.