Account aggregator transaction

Account aggregator transaction

Subject: Economy

Context:

A year after its official release, India’s Account Aggregator (AA) ecosystem boasts of 1.1 billion.

Account Aggregator (AA) ecosystem 

• Account Aggregator (AA) network is a financial data-sharing system.
• The AA ecosystem was conceived in 2016 but was officially launched in September 2021.
• It already has 23 banks and three life insurers as financial information providers (FIPs) on its platform and 78 entities registered as financial information users (FIUs).There are six operational AAs and another nine in-principle AAs waiting to get their operating licence from RBI.
• The AA platform was created through an inter-regulatory decision by the Reserve Bank of India (RBI), the Securities and Exchange Board of India (Sebi), the Insurance Regulatory and Development Authority (IRDAI), and the Pension Fund Regulatory and Development Authority (PFRDA) through the Financial Stability and Development Council (FSDC).
• RBI issues licenses to AAs.
• The AA framework was designed by the Reserve Bank Information Technology Pvt. Ltd (ReBIT)—a wholly-owned unit of RBI.
• It is based on the Data Empowerment and Protection Architecture (DEPA) frame, which is also known as the ‘Consent Layer of India Stack’.
• Registering with an AA is fully voluntary for consumers and a customer can reject a consent to share request at any time.
• Account Aggregator empowers the individual with control over their personal financial data.
• An Account Aggregator (AA) is a type of RBI regulated entity (with an NBFC-AA license) that helps an individual securely and digitally access and share information from one financial institution they have an account with to any other regulated financial institution in the AA network.
• Data cannot be shared without the consent of the individual.
• Account Aggregator replaces the long terms and conditions form of ‘blank cheque’ acceptance with a granular, step by step permission and control for each use of your data.