Software is a necessary requirement of DPDPA compliance but neither it is sufficient nor the first priority.
Going by newspaper reports it appears that Banks in India are showcasing their DPDPA compliance by installing the necessary software and hardware to enable DPDPA compliance.
A report in Business Standard today indicates that SBI is targeting its compliance program to be completed by end of 2026, five months ahead of the due date for implementation. The report highlights that SBI has “Procured” software and hardware as part of its preparations for compliance and installation and deployment eis expected to be completed by Decmber.
Similarly, Canara Bank recently announced that it has awarded a contract of Rs 52 crores to a software company for DPDPA compliance.
While it is encouarging to note the large investments being committed and the desire to meet the deadline, it is not clear if Banks are adopting a path to compliance which is likely to lead them to a software dependent business model.
Most of the Banks have not completed their employee awareness program and now if they are already committing to the purchase of software, they are likely to encounter problems sooner or later when the dynamic industry needs to make changes.
Banks in India have a unique problem in DPDPA compliance since data processing occurs at hundreds of branches while the compliance may be focussed on the CBS system as if the Data Center is the unit of compliance.
What the Banks may be initially doing is to send out notices to all their current customers like the renewal of KYC and most of the investments may represent this cost. This is only one part of the requirement. What is more critical is the abilit to meet the Data Access Requests, Grievance redressal etc.
We need to be war of some of the Banking giants creating a wrong path to compliance and claiming that what they are doing only is the correct path. It will require some complaints and enquiry by DPB and appeals at TDSAT and Supreme Court before their approach gets a validity.
Let us wait and see how things proceed…
Naavi
