The company said that the licence permits PhonePe to launch its AA platform that will enable instant exchange of financial data between the Financial Information Users (FIUs) and Financial Information Providers (FIPs) with due consent from customers, in a safe and secure manner. This will help Indiabased consumers avail financial services in a more convenient manner.
Financial data of customers is spread across banks and other institutions, each having different methods and platforms to access information. Account aggregation solves this issue by compiling data from multiple accounts under one roof. This may include deposits, investments, insurance policies, pension schemes, etc.
In 2016, RBI approved a new class of licenced NBFCs to provide account aggregation services based on a customer’s explicit consent. AAs are regulated by RBI, Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI), and Pension Fund Regulatory and Development Authority (PFRDA) and are purely information technology-driven. This means they cannot store any data and can only facilitate the real-time exchange of data.
AAs enable FIPs like banks, AMCs, pension funds, among others to share data with FIUs or entities that consume this data. There are four licenced AAs functioning currently – CAMSFinServ, Cookiejar Technologies, FinSec AA Technologies, and NSEL Asset Data. Apart from PhonePe, the players who have received in-principal approval are Perfios Account Aggregation Svcs and Yodlee Finsoft.
Currently, around 12 banks and institutions are at various stages of implementing the FIU and FIP framework. This includes State Bank of India (SBI), HDFC Bank, ICICI Bank, LendingKart, among others.
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