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Capital market regulator SEBI has made it mandatory for financial information providers to seek approval of investors before sharing their information with RBI-approved Account Aggregators. Some of the depositories and asset management companies (through their registrar and transfer agents) were recently approved to provide FIP services.
The FIPs should share the financial information pertaining to securities markets, through the account aggregator only on receipt of a valid consent artefact from the customer, said SEBI.
Further, it said FIPs in the securities markets should also verify the validity of investors consent, specified dates and usage and the credentials of the account aggregators. On due verification of the investors’ consent, the FIPs in the securities markets should digitally sign the financial information and securely transmit it to the account aggregators with the terms of consent artefact. All responses of the FIPs in the securities markets shall be in real time, it said.
FIPs in the securities should build adequate safeguards in IT systems to ensure that the data is protected against unauthorised access, alteration, destruction, disclosure or dissemination of records and data, said SEBI.
Revolutionary move
RBI unveiled the account aggregator network last September for financial data sharing to revolutionise investing and credit. The network is aimed to give millions of consumers greater access and control over their financial records and expand the potential pool of customers for lenders and fintech companies. It started off with eight of the country’s largest lenders.
Account aggregation involves compiling financial information from multiple sources into one place. Going beyond traditional credit rating agencies’ assets such as loans and credit cards, it also collects data from cash flow and investments-based inputs. This includes income from multiple sources, expenses, invoices, receipts, deposits, equity investments, tax returns and more.
The RBI account aggregator framework allows customers to seamlessly share information with their financial service providers. It also gives customer significant control on sharing of information.
RBI has given in-principle approval to eight account aggregators including CAMS FinServ, Cookiejar Tech, FinSec AA Solutions, Jio Information Solutions, National e-Governance Services Asset Data, Yodlee Finsoft, Perfios Account Aggregation Services and Aditya Birla Trustee Company for building a data-sharing solution.
About eight major public sector banks including State Bank of India, Canara Bank, Bank of India, Indian Bank, Punjab National Bank, Union Bank of India, Bank of Maharashtra and UCO Bank have joined the account aggregator ecosystem.
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