Digital India: Disruptions –

Security, New Technology &

Our State of Readiness
September 2017
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Contents
Foreword 05
Introduction 06
Banking and Financial Services: Powering services
for mainstream adoption and balancing security of data 08
Digital disruption: Trends, exponential
technologies and challenges 16
Evolving Role of Regulator in Digital India 26
Glossary 30
Additional References 32
Acknowledgements 33

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Foreword
The banking model is being unbundled partnerships forged by service providers •• Protect the People – Avoid
with the range of service providers across sectors, customers are exposed departmental silos and allow uniform
widening, technologies making service to a host of additional choices offered by information distribution
offerings more personalized and the partners. Use of data to deliver the
•• Place your Customer First – Fulfilling
on demand, and customers making right customer experience, leveraging
customers should be the priority
informed decisions, leveraging advances innovations to make offerings simplistic
in data science. Players are using agile and to give the customer complete •• Avoid status quo – Try new ideas in
processes, so that products and services control are the new guiding principles solving old industry issues
can get to markets sooner and be for service providers. Some firms are
•• Focus on Value – Revenue should
adjusted along the path. “Mutualization” choosing to bridge gaps in internal
always be the key driver for any idea
is a case in point. The evolving regulatory capabilities and adopt a more holistic and
and market landscape is requiring value-based approach by understanding •• Make design thinking the way of work
companies to gradually realign their that all these applications are not always
•• Acquire capabilities to catalyse the
operating model to protect margins. a panacea. Organizations will have to
culture
Industry efforts to rationalize costs make choices, that include trade-offs.
through down-sizing, outsourcing They will need a vision of their future, •• Balance the risk approach – encourage
and automation have not yielded the the applications of these in the context controlled risks in right circumstances,
savings and improvement in service of their overall strategy, culture and while remaining cautious when
quality that was originally envisaged. structure. They have to evaluate the key engaging in high-risk activities
Mutualization, or the use of common considerations in implementing changes
standards and/or market infrastructure, and aligning them with their ambitions. We hope you find this report useful in
is enabling non-core activities to be rethinking your value propositions to win
packaged and provided as a service At an ecosystem level, development in over tomorrow's demanding customers.
to market participants. It is allowing banking infrastructure and implementing
financial institutions to share costs, regulations that are receptive to
boost efficiency in the back & middle innovations and data requirements are
office and restore focus on core business also required.
activities. It has applications in optimizing
collaterals, movement of securities, KYC We are not there yet and have a lot to
record management, and is already learn from other players and markets
showing significant results in reducing where this is being/has been done
KYC/AML costs. well. Moving to a future state where
financial services make our lives better
Incumbent players have up their ante requires heavy investment in emerging Kalpesh J. Mehta
and are embracing these changes, as technologies, skillsets, risk management.
well as emerging competition. They are To leverage disruptions players across
seeking to convert banking consumers sectors must:
who use digital touch-points to brand
•• Think Exponential – Set bold goals and
loyalists, as also to widen their user
allow failures
base. All sectors with large connect to
customers, leverage disruptive tools •• Execute Agile – Allow ideas with short
when doing financial settlements with iterative sprints with empowered teams
their customer base. Due to ecosystem

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

Introduction
The confluence of technology, new initiatives
powering banking such as FinTech, data security, and
a progressive regulatory environment, are offering
radically new possibilities to achieve the Government’s
vision of a Digital India.

Our state of readiness - is far from ideal, as a serious

divide exists between the unserved and the served.
For financial services to make our lives better, there
are costs to be borne, but the end-goal is desirable.

Insights gleaned by us from our experience in the

industry have been reflected in this Point of View, as
we put the spotlight on the key factors that can help
achieve the vision of a progressive, responsible, and
digitally powered India.

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

Banking and Financial

Services: Powering services
for mainstream adoption and
balancing security of data
Introduction The vision for a Digital India requires
The financial ecosystem in India is immense interoperability between
undergoing a transformation. Trends that data, mediums, identity systems, bank
are taking root cause in financial services accounts. Leveraging Jan Dhan, Aadhaar
and emerging business models, are and Mobile (JAM trinity), for beneficiary
bringing a larger no. of people under the enrolment has been the logical next step
financial inclusion umbrella. These are in the rollout of financial services.
changing financial services delivery, and a
new financial system is emerging.

Aadhaar Pradhan Mantri Jan-Dhan Mobile Telephony

A centralized database in India Yojana (PMJDY) Mobile Phone penetration
was a long standing issue. This Jan-Dhan Accounts were opened in India stood at 1,170 Mn3
changed with Aadhaar, a 12-digit to increase banking penetration subscribers as of March 2017.
biometric based unique-identity in India and mandated at least
number, issued to 1,144 Mn1 one basic banking account per
Indians (86.7% saturation) household. The scheme has
as of August, 2017. Aadhaar 295 Mn2 beneficiaries as of
has emerged as an important August 2017.
instrument in payments and in
the delivery of citizen services.
While Aadhaar has been used to
identify beneficiaries, it’s seeding
in bank accounts is not 100%.

1
UIDAI portal, https://uidai.gov.in/images/StateWiseAge_AadhaarSat_24082017.pdf
2
PMJDY portal, https://www.pmjdy.gov.in/account
3
TRAI portal, http://www.trai.gov.in/sites/default/files/PR_No.37of2017_English.pdf

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Aadhaar can have concrete impact Penetrating and serving the

in beneficiary identification and underserved segments & businesses
authentication; Jan Dhan accounts With improved prospects of tapping into
seeded with Aadhaar can be used for new the underserved/userved, there
direct transfer into bank accounts, is a strong business case for building
reducing the dependence on cash and the financial services architecture at
related inefficiencies such as leakages; the back-end, in a way that it is running
mobile technology can be used for seamlessly.
information dissemination and as a
medium to conduct transactions. With i. Payments eco-system heft to
Aadhaar penetration high, Jan Dhan increase accessibility, availability,
Aadhaar enabled PDS – (Cashless interoperability and security in
AePDS) being mobile phone agnostic, payments
is well-placed to take advantage of this For building an eco-system of electronic
discrete identity network and target the payments by reducing paper based
masses. E-Wallets are gaining popularity instruments, the Reserve Bank of India
due to the user’s growing comfort with (RBI) vision 2018 4 to develop Payments
wallets. Mobile wallets are being used and Settlement Systems in India focuses
for a variety of purposes with JAM trinity on “Coverage”, “Convenience”,
and average transaction sizes for wallets “Confidence”, “Convergence”, and
have been on a rise. Data sources and “Cost”. To this end, strategic initiatives
Electronic KYC (EKYC) can do massive to be undertaken by participants in the
back end enrolment of beneficiaries, payments industry include:
with people receiving credits directly
1. Responsive Regulation
into their wallets. Other developments
in Financial Services such as Unified 2. Robust Infrastructure
Payments Interface, offering ease of use
3. Effective Supervision
by facilitating instant transfer of funds
to a virtual address using smartphones; 4. Customer Centricity
differentiated banks such as Payments
Banks, many of which possess existing These initiatives are expected to result
large customer bases; India-Stack, in a decreased use of paper based
bringing parity among players via its instruments, increased users of
open Application Programming Interface mobile banking, growth in
(API) policy for five key programs; and acceptance infrastructure,
FinTech start-ups upending traditional increased use of Aadhaar based
delivery models; are all set to transform payments, as well as growth
the delivery of financial services in India. in other modes of electronic
payments.

4
Payment and Settlement Systems in India: Vision-2018, Reserve Bank of India, June 2016 : https://rbi.
org.in/Scripts/PublicationVisionDocuments.aspx?Id=842

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

1 Responsive
Regulation 2 Robust
Infrastructure 3 Effective
Supervision 4 Customer
Centricity

A Regulatory framework that allows for Committee under Ratan P. Watal5 to

enhanced coverage, interoperability in promote digital payments in India,
payments, along with convenience and also emphasized the need for setting
security for end users. Some tenets of up a separate payments regulator and
such a framework include: improving acceptance infrastructure in
India.
•• Framing new policies and reviewing
•• Amendments to Payment and
existing policies, to orient them with
Settlement Systems (PSS) Act, 2007, to
new innovations.
ensure better governance.
•• Setting up Payments System Advisory
•• Strengthen Financial Stability by
Council (PSAC) for industry and
identifying legal entities in financial
Government representatives to
transactions and taking steps to settle
strengthen the consultative process.
transactions in central bank money, to
Recommendations of the Watal
avoid credit and liquidity risks.

1 Responsive
Regulation 2 Robust
Infrastructure 3 Effective
Supervision 4 Customer
Centricity

There is an urgent need to simplify and (BBPS), and online marketplaces, will
accelerate payments penetration in likely induce electronic payments
India. Lack of sufficient IT infrastructure activity in a diverse and vast country
and end to end digitization is leading to like India where all modes are welcome,
challenges in driving digital payments. For these options now need to be
greater proliferation of digital payments, stabilized to create trust in the minds of
the entire supply chain must be digitized. participants. Payments also need to be
To increase accessibility, availability, made scale-able for mass adoption to
interoperability and security of payments become the norm. In response to this,
systems, RBI has recommended: mobile based payment solutions are
recommended to service providers. The
•• Facilitating faster payments services. A
back end of banking systems must be
host of options have been introduced
adapted to accept any payment volume,
in the market including multi device
allowing products to scale. More
solutions, all options on one device
frequent settlement cycles for NEFT,
e.g. a multi functionality POS, and a
is one such recommendation to help
more lightweight -software based
achieve this.
solution. While introduction of Point
of sale terminal (POS), mobile point •• Improving accessibility by way of
of sale terminal (mPOS), Near field improved acceptance infrastructure.
communication (NFC) based, Aadhaar Significant growth in acceptance
enabled, Mobile wallets (m-wallets), infrastructure is seen as a primary
other pre-paid instruments, Immediate outcome of RBI’s vision 2018. Key
Payment Service (IMPS), National lacunae in acceptance infrastructure
Electronic Funds Transfer (NEFT/EFT), are, it is currently skewed in favor
Unified Payments Interface (UPI)/ of issuers, with the issuer banks (of
Bharat Interface for Money (Bhim), POS terminals) getting majority of
Bharat QR, Bharat Bill Payments System Merchant Discount Rate (MDR) and

5
Committee on Digital Payments: Medium Term Recommendations to Strengthen Digital Payments
Ecosystem, Ministry of Finance, GOI, December 2016 : http://mof.gov.in/reports/watal_report271216.pdf

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

merchant acquirers have to invest from traditional acquiring banks (as

in POS terminals, aside from paying POS aggregates the multiple solutions).
high interchange fee. As a result,
•• Promoting inter-operability across
banks issuing POS terminals are many.
providers – UPI aims at allowing
Merchant acquiring banks, on the other
customers this convenience of
hand are few in numbers. Banks are still
using payment instruments across
grappling with on-boarding merchants
service providers. Toll collection and
to penetrate for financial inclusion.
Mass Rapid Transit payments to be
Remedies that can bring merchants
made electronic in an interoperable
on board include, low cost options for
environment are also to be prioritized.
smaller merchants, merchant training
and support, using National Payments •• Enhancing safety in payments to
Corporation of India (NPCI) innovations cement customer relationships
such as Bharat QR (non-hardware
•• Eliminating paper flow in Cheque
based model). More options in the
clearing systems and complete
market imply the Merchant acquiring
migration to CTS-2010 Standards
business will see intense competition

1 Responsive
Regulation 2 Robust
Infrastructure 3 Effective
Supervision 4 Customer
Centricity

The RBI proposes: •• Strengthening the reporting framework

and monitoring fraud occurring in
•• Testing the resilience of the payments
various payment systems
and settlements infrastructure
including Financial Market •• Analyzing data emerging out of and
Infrastructures (FMIs) and System Wide publishing reports on payment systems
Important Payment Systems (SWIPS) in
the country

•• Designing the oversight framework for

new and existing payment systems, to
make the payment infrastructure more
resilient

1 Responsive
Regulation 2 Robust
Infrastructure 3 Effective
Supervision 4 Customer
Centricity

Payment options that offer customers •• Customer education and training about
& merchant’s convenience, build trust, electronic banking, fees, terms
are frictionless, put in place adequate
•• Protecting consumer interest by limiting
customer redressal mechanisms, and
his liabilities and managing risk of fraud
create awareness and education among
customers, will give the customer holistic •• Positive confirmation messages to
control over their payments experience. remitter in Real Time Gross Settlement
(RTGS), similar to NEFT
Some key tenets include:
•• Conducting customer surveys to
•• Necessary guidelines and trainings
gauge changes in payment choices of
to strengthen customer grievance
customers
redressal

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

ii. Drawing lessons from a framework •• PSD2 facilitates customer

such as European Central Bank’s convenience and protection.
(ECB’s) “Payments Service Directive 2” It mandates strong customer
(PSD2) for India authentication. Payment
PSD2 requires Banks to open their service providers are also
data infrastructure to third parties, by required to set up incident
adopting APIs to enable them to provide management procedures.
improved products and services to
•• In order to provide
customers. With PSD2 the European
consumers with convenient
Union (EU) has the chance to create an
and easy-to-use services
“EU digital single market”.
within a complex market,
PSD2 aims to ensure the efficient and
ECB6 and European Banking
regulated exchange of information
Authority (EBA) worked closely to
between players.
emphasize standards on strong
customer authentication and secure
India is on a similar growth trajectory as
communication to promote safety and
the EU in electronic payments i.e. has
efficiency of electronic payments in
diversity in banking practices, variance
the Euro. Payments Service Directive 1
in technologies adopted across the
(PSD1) has been in place since November
country, and is looking at achieving Pan
2007 and coordinates supervisory and
Indian implementation of a frictionless
oversight approaches to ensure safety
Payments system. With RBI’s Vision 2018,
and focus on consumer protection and
PSD2 creates implications for the path
rights of service providers and users.
that can be taken on home turf. Some
As the market for payments underwent
takeaways for India:
changes thereafter, the EU institutions
proposed aligning the EU and national •• By opening up their APIs, customer
legislations with the increasing no. of information that was earlier restricted
players (smaller payment companies to Banks, will now be available to a
and FinTech companies), and activities wider set of industry participants (with
of the payments industry. PSD2 was customer consensus), encouraging
put in place. PSD2 is a set of new rules greater competition, more innovation,
to protect consumers when they pay and a greater likelihood of achieving the
online and changes the “territorial” and inclusion objective.
“currency” scope of PSD1.
•• By capping interchange fee, PSD2
reduces the overall cost of a card
•• It makes cross-border payments transaction, gives a boost to digital
safer, as also increasing Pan-Europe transactions, and reduces dependence
participation in the Payments industry. on cash.
For instance, it ensures consumer
•• Seeing a consolidated customer bank
protection, even if the service provider
portfolio (across various banks), in one
is located outside the European
screen, application of analytics to real
Economic Area (EEA), or the transaction
time data monitoring allows improved
is in non EEA currencies.
advice under PSD2.
•• It promotes innovative online
payments, mobile payments, as also
increasing participation from non-
banks (increased competition).

6
The ECB cooperates with the EBA to improve the security of electronic payments in
Europe, European Central Bank, February 2017: https://www.ecb.europa.eu/paym/pol/
shared/pdf/20170223_ECBcoopEBAimprsecelpaym.pdf

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

iii. Ensuring security of sensitive data increases. Ensuring data security and
leveraged for Digital Financial Services protecting consumer interests is critical
(DFS), while also facilitating its use for keeping in-tact reputational risk of
Engagement models of the future are service providers, while also mining
riding on the back of huge amounts new revenue streams. There is an
of emerging Data, as we move rapidly urgent need for security protocols to
to digitization. Although data is a minimize breaches. We need to raise the
competitive resource (access to data will bar on security methods by increasing
lead to more products, opportunities our defenses and reducing attacks.
to cross-sell to better drive customer Companies that are generating insights
engagement, greater competition, lower using data, while have the promise of
cost innovations) and has a lot of scope, efficiencies, their success will depend on
data breaches are on the rise. These their ability to offer/leverage solutions
breaches will likely grow as sophisticated which can encrypt and secure data.
threat vectors emerge and attack severity

Some important considerations towards ensuring data security are:

Evolving Infrastructure Analytics for fraud detection Customer Awareness

Security infrastructure needs to DFS will have potential for misuse, but A part of ensuring security is creating
keep evolving, as the focus on threat analytics can be leveraged to avoid awareness among users
prevention increases frauds

Data-Ownership Cost of Security

Customer expectations on defining Data Security isn’t free and needs
ownership of data are evolving to be factored into the cost of a
digital transaction. Digital audits and
forensics must claim a larger share of
digital spend and become a CFO level
agenda

iv. If DFS needs to grow exponentially, customization of products and prices,

it’s pricing needs to be appropriate else it risks low accessibility of DFS. The
The Government’s vision of a Digital product mix selected by customers
India entails DFS be made available to will largely be impacted by pricing. For
all. If DFS is to become mainstream, we instance, due to the costs associated with
cannot ignore the ever-present “pricing” card based payments, a push toward
question. Pricing DFS needs to be correct mobile phone based payments was done
to drive uptake, spurring the need for on the back of IMPS.
the right pricing models. India, by virtue
of it’s price-sensitive character, calls for

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

Amidst these developments, can growth be inclusive and percolate to the lowest
segments?

Few illustrative digital applications across the spectrum

Improved prospects for Credit Decisioning

Traditional lending methods are data across ecosystem partners), and

unable to serve people with limited the application of technologies, lenders
credit data i.e. credit score/history, can increase the quality of the loan
especially underbanked individuals. Low being disbursed, and reduce costs of
penetration of retail and Micro-Small disbursing these loans (efficient customer
and Medium Enterprises (MSME) credit acquisition, approval, servicing).
is causing a huge credit gap in the MSME Alternate lenders, including Person to
segment. This lacunae is being looked at Person (P2P) platforms, credit scoring
as an opportunity by new-age lenders, platforms, and marketplace platforms
given the applications of vast amounts are being able to address credit needs of
of emerging data and the exponential underserved segments by harvesting rich
benefits in analyzing it in a digital customer data, using analytics to detect
environment. Customer insights are key patterns from these data sources,
paving the way for “data driven” revenue building credit profiles of customers in
models, in the face of unsustainable minutes and, providing actionable credit
“transaction-only” revenue models. Data decisioning. By making more accurate
helps tapping into customer behaviors. risk predictions based on data and
By drawing out unique patterns from technologies, loan approvals are likely to
micro data, adding data-points (service be quick, in real-time, and at a fraction of
providers are also linking customer the current costs.

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Direct Benefit Transfers (DBT)

Cashless payment in DBT is likely to:

1 4
Incentivize merchants to deliver better quality of Beneficiaries have a wider choice of goods and
goods sold in the open market, at market prices unused amounts can be carried over

2 5
The right amount of entitlement that is to be Leakages in the transfer of subsidies are
credited to a beneficiary can be identified eliminated (due to end to end digitization of the
supply chain)

3 6
Subsidies that were earlier being transferred Beneficiaries can avoid the hassle of physically
to the same beneficiary repeatedly, will now be withdrawing cash, the subsidy amounts will be
transferred only once used for the intended purpose only

Payment Banks (PBs)

Due to their dependence on, and need acquisition, forge partnerships with
to generate “transaction based income”, Banks, FinTech companies to expand
PBs are being forced to come up with product offerings, and use Aadhaar for
innovative methods to be inclusive, payments (using a smartphone with in-
e.g. focus on biometric authentication built biometric scanner).
to bring down the cost of customer

Conclusive Remarks customer demands. Market participants

An interoperable platform by way of that focus on data security and invest
JAM trinity, other developments such in improved infrastructure are likely to
as UPI, use of analytics in lending dominate the agenda. PSD2 has some
have been adequately leveraged by key takeaways in the Indian context and
providers of financial services, for to that end, the regulator is an important
greater proliferation. Upcoming releases catalyst driving change, and in taking
of products and services by service financial services to the lowest segments.
providers will be largely keeping with

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

Digital disruption:
Trends, exponential
technologies and challenges
Introduction combined with exponetial technologies Digital disruption and exponential
We are in the era of digital disruption like robotics, cognitive computing, technologies are blurring the lines from
wherein constant change is the new internet of things, blockchain, drones, an industry perspective, with leading
normal. Adapting to increasingly digital 3D priniting and autonomous vehicles, practices and learnings from one industry
market environments and taking the impact is profound. This will lead being applied to other industries. In
advantage of digital technologies to to emergence of multiple disruptive India, the financial sector has been at the
improve business are important goals scenarios adding pressure on business fore front of leading the way in terms of
for nearly every contemporary business. leaders to understand their implications digital adoption, however, other sectors
The rate of technology change and its and respond quickly. Some of these like healthcare, manufacturing and
convergence is accelerating exponentially, future scenarios include digital banks, government are catching up fast. In this
thereby making it difficult for excecutives P2P lending, remote healthcare, robo- chapter we will explore how organisations
to understand its implications to advisory, digital citizen and many more as are reinventing themselves through
their industry and organizations. The illustrated in Figure 1: innovative business models, achieving
digital interventions of social, mobile, growth & profitability, and bringing
analytics, big data and cloud technologies in efficiencies in their operations, by
are laying the foundation for any tapping into some of these exponential
tranformation today. When these are technologies.

Figure 1: Emerging Future Scenario

3D
Web
Printing

Ecosystem
Digital Bank
Cloud Drones

P2P Lending

Internet of
Mobile Things
Robo-advisory

Remote Healthcare

Open
Social APIs
Digital Citizen

Digital Intervention

Analytics Cognitive Exponential Technology

Systems
Disruptive Future Scenario
Blockchain RPA
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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Blockchain Banks are continuously exploring

Blockchain is being widely debated new ways to perform transactions
and has become the new buzz word faster, for enhanced customer service,
for multiple industries, especially while ensuring cost efficiency in their
banking. Banks across the country have operations, and assuring transparency
successfully initiated collaboration to their customers and the regulators.
with specialized firms (FinTech) and/ For this, blockchain potentially provides
or consulting firms, to build proof-of- a solution for banks as it inherently helps
concepts and explore various potential eliminate intermediaries, maintains
use-cases. This implies how seriously an immutable log of transactions, and
banks are considering blockchain also facilitates real-time execution of
technology and how eager they are to transactions. This could potentially
understand the ways this technology can optimise the TAT for banking
help reinvent business models or address transactions, reduce costs of manual
some of their pain points. work, and enhance customer experience.
Like any other industry, choosing the
In the recent past, aggregators like Uber right ‘use case’ is the key for banks to
and AirBnB have disrupted mainstream leverage the full value of blockchain.
businesses by redefining business
models. Blockchain has a potential to
disrupt these disruptors since it removes
the need of intermediaries in doing
business.

Figure 2: Potential use cases for blockchain7

Use Case Current Pain Point Blockchain Solution

Smart Identity Time consuming, manual, insecure, Automated, Less compliance errors,
fragmented & broken real-time, secure & self-managed

Quick, cheap, data rich,

Cross Border Time Consuming, high cost, non- frictionless, immutable,
Payments transparent transparent

Vendor Financing Manual, Time consuming, lack of trust Automated, real-time, immutable

Standardized reward tokens,

Customer Loyalty Lack of interoperability, Delayed
Instant gratification & real time
Program gratification & limited redemption
tracking

Time consuming, Intermediary fee, Faster syndicate formation,

Syndicated Loans
manual automated, quick

7
https://www2.deloitte.com/in/en/pages/strategy/articles/blockchain-in-banking.html

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Digital India | Disruptions – Security, New Technology & Our State of Readiness

A leading private sector bank in India has 2. Integration procedure and change
implemented a multi-nodal blockchain adoption: Blockchain applications
transaction to fully digitize vendor offer solutions that require significant
financing for a consumer electrical overhaul of existing systems. In order
equipment manufacturing company. to make the switch, companies must
The implementation has been done on a strategize the transition.
blockchain-based smart contract written 3. Cost: Blockchain offers tremendous
by a FinTech start-up. The solution also savings in transaction costs and time,
leverages IBM Watson Conversation, a but the initial cost of investment in the
cloud-based cognitive service, to enhance technology might be high.
the digital experience of partners,
corporate clients and developers. Though the potential of blockchain is
widely claimed to be at par with early
Kotak Mahindra Bank has partnered commercial Internet, it is important
with Deloitte to enable end to end trade that firms understand the key features
financing for one of its clients by utilizing of the technology and how it can solve
blockchain technology, thereby reducing current business issues. Companies need
the time taken for a letter of credit (LC) to identify opportunities, determine
to few hours from 20 to 30 days. It not feasibility and impact, and test proof of
only eliminates data duplication, but concepts. This will involve answering a
also integrates data to a central cloud- series of fundamental questions related
based access system for participants in a to the dynamics of transactions and
transaction. regulations underlying the transaction.
Lastly, due to lack of any precedence,
Though blockchain is a powerful solution, firms will have to opt for a trial-and-error
it is still in its exploratory stage and approach, either through internal trials or
comes with its own set of challenges partnering with a specialized firm.
which include:
1. Non – clarity around regulatory status:
Few of the blockchain use cases
involve usage of cryptocurrency.
Such transactions require changes in
regulations from government bodies
like RBI. While regulators are required
to drive adoption of blockchain, they
also need to be part of a blockchain
network to get visibility from a
regulatory compliance perspective.
Hong Kong Securities and Futures
Commission is working with member
banks and technology providers to
test online ledgers to record and settle
securities and futures transactions.

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 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Robotic Process Automation (RPA) 2020 across the globe, and 2/3rd of these
According to World Economic Forum will be in the office and administrative
report titled Future of Jobs, more than sectors. The global RPA market is
5 mn jobs will be lost to Automation, expected to experience a 60% CAGR
Robotics and Artificial Intelligence by through 20208.

Figure 3: Robotic Process Automation market evolution9

Within 10 Years
Projected 2020
~$ 5B
ITA RPA Market
Dependence on
Global Horizontal
Category Machine
Learning Platforms
Today
Current Golbal IT Widespread
$ 800M Cognitive
RPA Market
Augmentation
Early Capable and Automation
Stage RPA
Early Cognitive
Solutions
Stage Legend
Deployed
BPM RPA
Systems Industrial Revolution
2st Industrial 3st Industrial
1 Industrial
st
Early Stage Technology
Revolution Revolution
Revolution
Mature Technology
1700s
Future Event

RPA tools evolved quietly over the last regulatory compliances10. With improved
decade, but have now reached a level accuracy, operations can now be carried
of maturity where process automation out round the clock. It results in improved
is possible at a significant scale. In employee morale as employees are freed
most organizations, there are many from mundane jobs and redeployed for
routine processes performed manually value creation.
that lack the scale or value to warrant
automation via IT Transformation, but for Digitization of white collar jobs via
which macros and other such desktop robotic and cognitive automation, and
automation tools are too limited to advances in data science have sparked
effectively address the issues. RPA can a mini revolution of sorts. RPA when
fill this gap by reducing the ‘minimum applied at the right scale, can be truly
viable scale’ of process automation as transformative for organizations however
compared to its traditional counterparts. it is important to identify the right
candidates for automation, clearly define
Organizations using RPA solutions the success criteria and build a business
typically achieve operational efficiencies, case with expected ROI articulated. It
improved quality, cost reduction, is important to drill down to various
decreased cycle times and improved attributes while identifying a process for
throughput. Automated processes automation and analyse them from ease
provide flexibility to change quickly, of implementation vs. benefits point of
ability to scale-up exponentially and view.
produce valuable audit trails for

8
http://www.transparencymarketresearch.com/pressrelease/it-robotic-automation-industry.htm
9
https://www.km.deloitteresources.com/sites/live/crossfunctional/_layouts/DTTS.DR.KAMDocumentForms/KAMDisplay.aspx?List=26eeb191-7a3b-4609-9f91-
b8fa5fc169f0&ID=844856
10
https://www2.deloitte.com/in/en/pages/finance-transformation/articles/robotics-cognitive-influencing-finance.html

19
Digital India | Disruptions – Security, New Technology & Our State of Readiness

A leading private bank in India Cognitive Computing

implemented RPA across 200 processes Today, cognitive technologies working
across the organization, including Retail alongside the existing ERP systems and
Banking Operations, Agri-Business, robotics can upend operational finance
Trade & Forex, Treasury and Human and bring about unprecedented speed,
Resources Management, among others. agility, and transparency to processes.
Today, robots are processing over 10 Examples of cognitive technologies
lakh transactions daily, bringing in include computer vision, machine
unparalleled operational efficiency, learning, natural language processing,
higher accuracy, and a massive reduction speech recognition, and robotics.
in processing time for customer This technology provides significant
services11. advantages such as cognitive automation,
cognitive insights and cognitive
Another large bank deployed a full engagement.
Robotics Process Automation (RPA)
implementation using 100 robots running Cognitive Computing is “a self-learning
18 processes to handle more than 85,000 system that uses data mining, pattern
requests each week. The output capacity recognition, and natural language
delivered by the robots was equivalent to processing to mimic the way the human
roughly 230 Full-time equivalents (FTE) brain works. The goal of cognitive
delivered at 30% of the cost of recruiting computing is to create automated IT
more staff. Additionally, two of the top systems that are capable of solving
five quality fails were eliminated following problems without requiring human
the introduction of robots. assistance”12.

Figure 4 : Cognitive Systems mimic and learn like humans

Learn and Apply Context

Improve and Interact •• Continually learn and
improve performance based
on feedback
•• Discern an expression’s
Identify Recognize and meaning based on contextual
Semantics Understand cues
•• Draw relationships between
unrelated concepts to make
sense of a situation
•• Leverage handwriting, voice
Reason and
Make Decisions and image recognition to
Process Data
ingest and process data

https://www2.deloitte.com/content/dam/Deloitte/in/Documents/finance-transformation/in-ft-crunch-time-future-of-finance-in-digital-world-noexp.pdf
11

https://www.ibm.com/think/marketing/things-you-can-do-with-cognitive-computing-right-now/
12

20
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Natural Language Processing (NLP) is AI platform powers customizable

extensively being tested in generation of virtual assistants that enable banks to
Flash Profit & Loss Reports, Profitability engage with their customers. Digibank
Analysis, R&D Spends, Sales/Margin customers can open an account quickly
Reports, Credit Reporting, FP&A and and effortlessly using just their Aadhaar,
related areas. NLP can present contextual at any of the partner-network of cafes
narratives for these, which give the across India. Now it is extending the same
consumer easy to digest and actionable services for MSME segments14.
insights. Natural Language Generation
(NLG) includes significant analysis, Deloitte has deployed a cognitive
inferences, and generating meaningful automation solution to automate
insights for the user. extraction and analysis of structured and
unstructured data stored in disparate
Machine learning is increasingly being systems. It is capable of ingesting
used for internal audit, with a Cognitive documents in various formats via a web
BOT in the audit team, the auditors interface and rapidly processing them
can analyse an entire set of accounting centrally. It provides clients with relevant
journals. Machine learning can aid in the insights on large amounts of information
Financial Planning & Analysis functions. to make informed decisions.
The key aspect of planning is to obtain an
accurate understanding and prediction of Automated Wealth Management – The
sales volumes. Machine learning has the service sends the customer a mix of pre-
potential to improve various processes defined investment products based on
such as Powerful Trend Analysis, Forecast an individual risk assessment. There are
Accuracy, Dynamic Forecasting and standardized algorithms that monitor the
Interactive self-service. Tools have been portfolio allocation on an ongoing basis.
developed that use machine learning Thus, based on the license that the Robo-
technology to scan electronic papers, Advisor works on, reallocation is done on
automatically identify and extract key a monthly or annual basis15.
accounting information from a wide
range of documents such as contracts, Open APIs
policies, agreements, purchase orders, APIs have grown drastically over the last
sales orders, commercial invoices, etc. few years. While the ability to connect
to digital resources using APIs is not a
A major challenge faced in new feature, the emergence of digital
implementation of Cognitive technologies platforms, mobile computing, lower cost
is the cross-disciplinary support required of data storage, automation has just
to develop and manage the technological transformed the way information can be
and analytics platform. New skills, as made available and exchanged, leading to
well as technology patterns are required faster evolution of the API ecosystem.
in the Finance organization. Cost of
implementation for full-scale roll out to Banks have also realized they need to
gain potential ROI from cloud computing move beyond products and reinvent
is also a major concern for companies. themselves by helping customers
There are also significant legal and make informed decisions. Through
privacy concerns while dealing with data APIs, banks now have the potential to
that people perceive as personal13. create an ecosystem of value added
services and emerge as “banks of the
A leading financial services group in Asia future”. By 2020, it is projected that
collaborated with Kasisto, to launch a 50% of B2B collaboration would happen
virtual assistant for Digibank, its “mobile through APIs.
only bank” in India. Its conversational

13
http://www.kmworld.com/Articles/Editorial/Features/Cognitive-Computing---Part-3--Challenges-and-lessons-in-cognitive-computing-116517.aspx
14
http://kasisto.com/ai-driven-virtual-assistant-from-kasisto-powers-indias-first-mobile-only-bank/
15
https://www.km.deloitteresources.com/sites/live/consulting/KAM%20Documents/All%20Consulting/KMIP-4273044/2016_Robo%20Advisory%20Insights_
final.pdf

21
Digital India | Disruptions – Security, New Technology & Our State of Readiness

In a quest to create this ecosystem, services, functions and data with 3rd
banking platforms are evolving from a parties to add additional value and create
closed to open banking model which new business models.
involved shared use of bank products,

Figure 5: Evolution on Open Banking

Retail

Customers Aggregators

Shift

Bank Wallets

Bank
Govt. Utility
Customer, Client, Bank
Product Data

Closed Banking Open Ecosystem

Limited data sharing, Bi-directional data sharing
Monolithic business model Disturbed business model
Banking as a platform

This ecosystem will allow customers to provide data-enabled tools to help them
make personalised comparisons between manage and optimise their finances.
accounts at different providers. This will
help them choose which account would Open APIs give banks in India
be best for them. It will also allow banks an opportunity to increase their
to provide better offers on products. geographical boundaries, create value
Opening up this data to third parties added services and monetize their
would clearly level the playing field. business assets by partnering with
Moreover, armed with customer banking FinTech companies, NBFCs, payment
data, both banks and third parties could banks and retailers. In November 2016,
ultimately offer new propositions such Citibank launched an API developer hub,
as money-management and budgeting which expanded developer access to APIs
tools. Open banking, therefore, could across several categories. Wells Fargo
lead to customers performing all their also expanded access to APIs, but it is
banking activities at different banks, invitation-only at this point in time.
using a third-party application that

22
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

The BHIM app. also leverages this API Think Big, Start Small and Scale Fast
ecosystem wherein it is a one stop shop It is highly challenging to keep up with
for all the UPI based payments. If one has the changes wrought by exponential
signed up for UPI-based payments on technologies. Some of these technologies
their bank account, which is also linked might seem like a buzz word at the
to the mobile phone number, the BHIM moment, however, they are here to
app. can be used to carry out digital stay and it is a matter of time before
transactions. they become part of the mainstream.
Organisations that have adapted the
Data privacy regulations have been quite digital and exponential technologies
stringent in some of the countries and are rapidly disrupting the traditional
factoring them in APIs becomes quite businesses. The key characteristics that
challenging. In India, “right to privacy” set these organisations and business
is becoming a prominent ask by citizens leaders apart are:
and the government is taking a serious
•• Ability to create value through
look at it. The regulation and laws around
ecosystem, network, and platform
data privacy are still evolving, and hence
based business models
the API frameworks need to be designed
in such a way that they keep pace with •• By being multi-modal i.e. ability to
changes without compromising on manage different velocities of change
flexibility and agility. within your organization

•• Inculcating a culture of innovation

By providing their APIs to third parties,
imbibing the principles of fail-fast and
banks are exposed to a greater risk of
learn-fast
cyberattacks and can no longer hide
their critical applications behind firewalls.
By embracing exponential and digital
On the other hand, banks will have
technologies, organization will not only
difficulty in maintaining their own strict
achieve growth, operational efficiencies
security requirements. Banks will still be
and customer centricity, but also stay
responsible for customer data ownership
ahead of the competition. This is the
which makes them liable for third party
right time for business leaders and
failures as well.
organisation to identify opportunities
and invest in innovation that can benefit
Although, open APIs give a plethora of
from the exponential technologies.
opportunities to banks to change their
value propositions, banks will need to
use customer data in innovative and
more individually tailored propositions.
Adapting to a digital marketplace also
requires more than simply upgrading
IT architectures and embracing new
technologies. To succeed, banks will
need to reshape their organisational
structures and cultures to a significant
extent. Innovation will need to be
placed at the very heart of the business,
and be encouraged at all levels of the
organisation. In addition to addressing
these issues, banks will also face the
cultural challenge of working within an
ecosystem with FinTech companies and
other tech-enabled firms.

23
Digital India | Disruptions – Security, New Technology & Our State of Readiness

24
Digital India | Disruptions – Security, New Technology & Our State of Readiness

25
Digital India | Disruptions – Security, New Technology & Our State of Readiness

Evolving Role of Regulator

in Digital India
Introduction providers, Payment Solution providers,
The Banking and Financial Services Digital Lending companies, Account
Industry (BFSI) has been witnessing vast Aggregators, Data Analytics solution
disruptions, as detailed in the previous providers, Social Network based payment
section. Emerging technologies such as service providers, Telecom companies
Blockchain, Robotic Process Automation, providing integrated payment solutions
Cognitive Computing, Cloud based etc., has seen a wide spread increase in
Technologies, Biometric etc., have the recent past.
increased cyber security risks across the
banking industry. These entities today collect significant
amount of customer’s personal sensitive
Further, the emergence of FinTech data at various stages, as mentioned
entities, including prepaid instrument below:

Various stages for collecting customers personal data

Customer On-
Personal identity information at the time of customer on-boarding
boarding

E-KYC exercise Biometric details as a part of e-KYC exercise

Transaction
Holds records of customer’s transaction history, spending pattern and habits
history

Execution of
Collects various other information on a day to day basis for executing transactions
transactions

Accordingly, it is imperative for the have possession of customer's personal has enacted the Information Technology
financial institutions to ensure protection data. Similarly, various Government and Act, 2000 under which the rules on
of customer’s personal data and use quasi Government agencies also collect “Information Technology (Reasonable
it as per the customer’s consent. The personal data for the purpose of various security practices and procedures and
entities also need to ensure adherence to social welfare schemes. Accordingly, it is sensitive personal data or information)
extant laws and regulations issued by the critical for these entities as well, to ensure Rules, 2011” have been issued16
Government and the Banking Regulator, the protection of sensitive customer data. The provision requires a body corporate
Reserve Bank of India. who 'receives, possesses, stores, deals,
Current Statutory and Regulatory or handles' any ‘sensitive personal data’
While the financial services space Environment on Data Governance in to implement and maintain ‘reasonable
has a larger impact considering the BFSI security practices’, failing which they are
sensitiveness of customer data that Statutory Laws enacted by the held liable to compensate those affected.
is collected, in the current scenario, Government of India
industries such as telecom, healthcare, While there is no separate act currently Majorly, the rules require that the body
social networking etc., also collect / on Data Privacy and Data Protection, India corporates collecting sensitive personal

16
Website of Ministry of Electronics and Information Technology, http://meity.gov.in/cyber-security
26
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

information of customers shall disclose instrument service providers on Data

to their customers, that information is Protection, Information Security or the
being collected and for what purpose the Cyber Security framework.
same will be used. Obtaining consent of
the provider of information is a critical Recent Steps by the Government /
requirement of the rules. Further it also Regulators
requires that the body corporates must Government of India, has on 31 July 2017,
implement reasonable security practices constituted a Committee to deliberate on
to ensure protection of data collected the data protection framework for India
from their customers. and submit a report on the same by 30
September 2017. The committee shall
Regulations issued by the Reserve Bank look at aspects such as data sovereignty,
of India data retention, and responsibilities of
RBI had, in 2011, formed a working group the Government, companies as well as
on Information Security, Electronic individuals while handling third party
Banking, Technology Risk Management data. The Committee shall make specific
and Cyber Frauds, and based on the suggestions for consideration of the
recommendations of the committee, Central Government on principles to be
has issued guidelines on nine broad considered for data protection in India,
areas across IT Governance, Information and suggest a draft data protection bill.19
Security, IS Audit, IT Operations, IT
Services Outsourcing, Cyber Fraud, Further, under the provisions of
Business Continuity Planning, Customer Information Technology Act 2000, the
Awareness programmes and Legal Government has also issued draft rules
aspects.17 for the Security of Prepaid Payment
Instruments in March 2017, which
The guidelines require that each Bank emphasise on the following key aspects:20
shall have a Board approved information
•• Protection of personal information
security policy. Among other things,
they require that Banks shall classify the •• Contractual arrangements to
information based on their sensitivity ensure that merchants handling any
and criticality, and accordingly implement authentication data have security
appropriate security measures to ensure measures in place to protect personal
protection of such information. information.

•• Customer identification and

Further, RBI has also issued guidelines on
authentication, both at the time of issue
the Cyber Security Framework in Banks
of Prepaid Instrument (PPI), and at the
in 2016, which emphasises on a Board
time PPI is accessed by customer, or
Approved Cyber Security Policy and
when a payment is initiated.
Cyber Crisis Management Plan covering
Detection, Response, Recovery and The Government of India plans to enact
Containment.18 a separate law on Data Protection and
Data Privacy by the end of 2017, which
RBI has also issued guidelines to Non is expected to create a robust legal
Banking Finance Companies (NBFC) on the framework.
Information Technology and Information
Security Framework. While the Reserve Bank of India, has
issued guidelines on information security
Currently, there are no defined guidelines and cyber security for Banks, such a
issued by the RBI to FinTech Entities such regulation is not available currently for
as payment service providers, prepaid other FinTech entities. However, the RBI

17
https://www.rbi.org.in/scripts/NotificationUser.aspx?Id=6366&Mode=0
18
https://www.rbi.org.in/scripts/NotificationUser.aspx?Id=10435&Mode=0
19
http://meity.gov.in/writereaddata/files/MeitY_constitution_Expert_Committee_31.07.2017.pdf
20
http://meity.gov.in/draft-rules-security-prepaid-payment-instruments-under-provisions-it-act-2000
27
Digital India | Disruptions – Security, New Technology & Our State of Readiness

has recently issued draft guidelines for states and territories. California alone
prepaid instrument service providers, has more than 25 state privacy and data
which among other things, seek to security laws.
address the following:
In addition, the large range of
•• Adequate information and data security
companies regulated by the Federal
infrastructure
Trade Commission (FTC) are subject to
•• Security operations centre
enforcement if they engage in materially
•• Vendor risk management
unfair or deceptive trade practices. The
•• Data loss prevention
FTC has used this authority to pursue
companies that fail to implement
Comparative Regulatory Environment
reasonable minimal data security
in other Geographies
measures, fail to live up to promises in
European Union
privacy policies, or frustrate consumer
EU superseded the Data Protection
choices about processing or disclosure of
Directive with the General Data Protection
personal data.23
Regulation (GDPR) in 2016 and the same
Regulation will be enforceable from 2018.
Asia
The Regulation will be applied to all 28
Japan introduced a separate central
of the European Union members. Data
legislation for protection of data as the Act
processors will be held under the law
on the Protection of Personal Information
which would include individuals, as well as
(APPI).24 The Act took partial effect in
companies processing bulky data.21
2016 and has been enforceable from
May 30, 2017. The law defines the scope
In common with the rest of the European
of the legislation and states on whom
Union, the United Kingdom will adopt
the law is applicable under Article 2-4 of
the General Data Protection Regulation
the APPI. As per the Act, it is applicable
(GDPR) from May 2018. When the United
to four entities - state institutions, local
Kingdom leaves the European Union,
public bodies, independent administrative
it will be free to adopt its own data
agencies, and an entity not having over
protection laws.
5,000 individuals’ personal information
for more than six months. Similar to the
In Germany, the main legal source of data
EU law, consent of a data subject forms
protection is the Federal Data Protection
the essence of the legislation, and has
Act (BDSG). Additionally, each German
been stated as mandatory in case of
state has a data protection law of its own.
transmitting data to a third party, or for
In principle, the data protection acts of
any use beyond communication purposes.
the individual states intend to protect
personal data from processing and use by
China has recently passed a Cyber
public authorities of the states, whereas
Security Law in November 2016, which
the BDSG intends to protect personal
will come into force from June 2017. The
data from processing and use by federal
new law, introduces a range of new rules
public authorities and private bodies.22
relating to networks and online activities
in the People’s Republic of China,
United States
including enhanced data protection/
The United States has about 20 sector
security obligations.25
specific or medium-specific national
privacy or data security laws, and
Singapore enacted the Personal Data
hundreds of such laws among its 50
Protection Act 2012 on 15 October
2012. The Act has extraterritorial

21
http://www.eugdpr.org/
22
https://www.gesetze-im-internet.de/englisch_bdsg/
23
https://www.ftc.gov/
24
https://www.ppc.go.jp/en/
25
http://thediplomat.com/2017/06/chinas-cybersecurity-law-what-you-need-to-know/
28
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

effect and so applies to organisations •• Regulatory framework on cyber security

collecting personal data from individuals and data protection at par for Banks,
in Singapore, whether or not the NBFC’s and other FinTech Entities
organisation itself has a presence
in Singapore. The data protection While enactment of laws and regulations
obligations under the Act do not apply to would be the way forward, the success
the public sector, as separate rules apply or failure of such implementation may
to the public sector. depend on the following aspects:

•• India, being a country with a large

An analysis of the above indicates that
population, is one of the most diverse
many countries have recently updated /
countries across socio – cultural factors,
enacted laws on data protection and data
and in its demography. Accordingly,
privacy and the emphasis seems to be
any central law should consider the
on obtaining consent of the customer on
impact of such diversity on successful
collection and utilization of sensitive data,
implementation.
and establishing a reasonable security
framework to ensure protection of such •• The central government and various
data collected from customers. state governments / their agencies have
been collecting personal data of citizens
Conclusive Remarks on various occasions for multiple
Recent amendments to the Information purposes, either for social welfare
Technology Act 2000, formation of a schemes (pension schemes, subsidies,
committee by the government of India to scholarships etc.), or for creating
deliberate on data protection framework, databases for various purposes (voter
RBI’s guidelines on cyber security database, income tax permanent
framework for Banks are steps in the right account number, Aadhaar database
direction to enhance the legal / regulatory etc.,). Therefore any legal framework
framework on Data Protection. that will be created should address the
potential risks emanating from such
Hon’ble Supreme Court of India has on welfare programmes and protecting the
24 Aug 2017, held that right to privacy is personal information of citizens.
a Fundamental Right and it is protected
•• Usage of internet and digital based
under Article 21 of the Constitution of
payments has witnessed a wide
India. This judgment is expected to have
spread increase recently due to the
a significant impact on the proposed legal
penetration of mobile networks into
framework on Data Privacy and Data
rural India and the encouragement
Protection.
provided by the government / Banks for
increased usage of digital payments.
Next steps may include enactment of laws
Hence, creating awareness among the
on Data Protection, covering the entire
citizens, particularly in rural India, on
landscape of Government Agencies,
the risks of sharing sensitive personal
Banks and Financial Service Providers,
data and making them aware of their
FinTech Entities, Telecom, Healthcare,
rights pertaining to protection of data
Social Networking and Communication
shared, will be the key to the successful
Applications, integrated with Payment
implementation of any legal framework.
Services, among others.

The following may be the next steps in

the right direction, to enhance the data
protection framework:

•• Enhancing the regulatory framework on

cyber security and data protection for
Payment Service Providers as envisaged
under the draft regulations issued

29
Digital India | Disruptions – Security, New Technology & Our State of Readiness

Glossary
AePDS Aadhaar enabled PDS

APPI Act on Protection of Personal Information

API Application Programming Interface

BDSG Bundesdatenschutzgesetz (Federal Data Protection Act, Germany)

BPPS Bharat Bill Payments System

BFSI Banking and Financial Services Industry

BHIM Bharat Interface for Money

B2B Business to Business

CFO Chief Financial Officer

CAGR Compound Annual Growth Rate

DFS Digital Financial Services

DBT Direct Benefit Transfers

EKYC Electronic KYC

EBA European Banking Authority

ECB European Central Bank

EEA European Economic Area

EU European Union

FMIs Financial Market Infrastructures

FTC Federal Trade Commission

FTE Full Time Equivalents

GDPR General Data Protection Regulation

IMPS Immediate Payment Service

IS Information Security

IT Information Technology

JAM Trinity Jan Dhan, Aadhaar and Mobile

KYC Know Your Customer

LC Letter of Credit

M-Wallets Mobile wallets

MDR Merchant Discount Rate

MSME Micro-Small and Medium Enterprises

M-Wallets Mobile Wallets

30
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

MPOS Mobile Point of sale terminal

NBFC Non-Banking Finance Company

NEFT National Electronic Funds Transfer

NLG Natural Language Generation

NLP Natural Language Processing

NPCI National Payments Corporation of India

NFC Near Field Communication

NBFC Non-Banking Finance Company

PSS Payment and Settlement Systems

PBs Payment Banks

PSD1 Payments Service Directive 1

PSD2 Payments Service Directive 2

PSAC Payments System Advisory Council

PRC People’s Republic of China

P2P Person to Person

POS Point of sale terminal

PMJDY Pradhan Mantri Jan-Dhan Yojana

PPI Pre-Paid instruments

RTGS Real Time Gross Settlement

RBI Reserve Bank of India

RPA Robotic Process Automation

SWIPS System Wide Important Payment Systems

TAT Turn Around Time

UPI Unified Payments Interface

31
Digital India | Disruptions – Security, New Technology & Our State of Readiness

Additional References
1. https://www.automationanywhere.com
2. https://www.uipath.com/automate/robotic-process-automation
3. https://www2.deloitte.com/content/dam/Deloitte/ch/Documents/manufacturing/ch-en-manufacturing-industry-4-0-24102014.pdf
4. https://dupress.deloitte.com/dup-us-en/deloitte-review/issue-16/cognitive-technologies-business-applications.html
5. https://www2.deloitte.com/in/en/pages/strategy/articles/future-of-banking.html
6. https://www2.deloitte.com/us/en/pages/deloitte-analytics/solutions/cognitive-analytics.html
7. https://www2.deloitte.com/content/dam/Deloitte/us/Documents/process-and-operations/us-sdt-process-automation.pdf

32
 Digital India | Disruptions – Security, New Technology & Our State of Readiness

Acknowledgements
Kalpesh J. Mehta

Monish Shah

Ashvin Vellody

Himanish Chaudhuri

We would also like to acknowledge the contribution of

Bhaskar Tondale, Mayank Rausaria, Rabani Gupta, Rami Reddy

Deloitte Touche Tohmatsu India LLP

For further information you may write to us at :
[email protected]

33
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