If your bank or NBFC is negligent in keeping your personal information safe, then it will not be easy to do so in the future. The Reserve Bank of India (RBI) has issued new draft rules to strengthen data security and data governance. Under these rules, banks, NBFCs and all financial institutions under RBI will have to create a strong system to identify, control and protect the risks related to data.
New framework will be created for data security
RBI says that due to the increasing use of digital banking and online services, data has now become one of the most important assets of financial institutions. In such a situation, it is very important to ensure security, quality and proper use of data. According to the new proposal, every bank and NBFC will have to prepare a data risk management system as a part of their risk management.
Data governance committee will have to be formed
According to the draft rules, every regulated entity will have to form a data governance committee or assign the responsibility to an existing senior committee. This committee will include officials related to data, IT, information security, business, risk management and compliance. Apart from this, the Board of the Institute will also monitor the entire data governance framework and review it from time to time.
The entire life cycle of data will be monitored
RBI has proposed that data be kept secure at every stage from its creation till its deletion. Institutions must also ensure that customer data is collected only for legitimate and specified purposes and is used in accordance with legal and regulatory requirements.
Suggestions sought till 17th August
The Reserve Bank has sought suggestions on these draft rules from banks, financial institutions and other concerned parties by August 17. Final guidelines will be issued after considering the suggestions. RBI believes that strong data governance will significantly reduce the risks of cyber attacks, data leaks, financial losses and threats to customer trust. This is expected to make digital banking more secure and reliable than before.
Input- PTI
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SK Sharma is a content writer who writes on news, entertainment, and lifestyle topics. She has over four years of experience and is known for conveying information in simple and clear language.
