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RBI Tightens Grip on Bank Data Sharing
16 Jul
Summary
- RBI proposes stricter data governance for financial institutions.
- Data access to third parties must be on a 'need-to-know' basis.
- Regulated entities remain accountable for all data shared.
The Reserve Bank of India (RBI) has introduced draft proposals aimed at enhancing data governance for regulated financial entities. These new guidelines focus on strengthening controls over the increasing use of external service providers, technology vendors, and group entities. A key proposal requires that data access for these third parties be strictly limited to a "need-to-know" basis.
Furthermore, the draft guidance emphasizes that data sharing must not lead to unauthorized reuse or duplication. Regulated entities will continue to be held accountable for all data entrusted to third parties. They must ensure that such sharing is confined to pre-defined and approved objectives, with oversight by designated personnel.
The RBI is soliciting public feedback on these draft proposals until August 17. The regulator also requires entities to classify data based on sensitivity and implement robust data quality metrics to ensure reliability for decision-making, risk management, and regulatory reporting.
