NPCI needs to be watched

NPCI was incorporated in 2008 and functions today as the national clearing house of all payments. Initially there were 10 promoters all of whom were Banks. It included foreign Banks like Citi Bank and HSBC. Since then several other Banks have been allotted equity.

Recently there is a move to set up a Private Sector NPCI clone or allow private equity directly in NPCI.

If we remember what happened in CIBIL and how CIBIL which was once owned to the extent of 92% by Banks was surreptitiously sold out to TransUnion and in the process 500 million plus sensitive personal data sets became the property of a US based private sector company.

This was a strategy which we called  “Data Laundering”.

At present, NPCI has a substantial chunk of financial data  travelling through their switches. Many private players have a facility to link their systems to NPCI and open a channel of communication to the Bank accounts of customers. The “Registered Mobile Number” is the only tenuous link to this access.

While NPCI may claim that they are a “Financial Intermediary” and may not store personal data of individuals in a manner a Bank may store, the possibility that the data passing through NPCI can be diverted and transaction profile extracted with a link to the registered mobile number cannot be ruled out. Once a registered mobile number is identified, it gives links to Aadhaar, PAN, Bank accounts, IT records and even the social media activities of the person.

We can therefore consider that NPCI is having access to all the sensitive personal data of people whose financial transactions pass through the NPCI.

When there are thoughts of privatization of such operations alarm bells should ring since this could be a preparation for another CIBIL type of data laundering.

Hence NPCI has to be kept under watch to check if they can be trusted with the financial information passing through their servers.

Presently, NPCI is managed under the Ministry of Finance which is amenable to all sorts of pressures from vested interests.

It appears that one of the reasons why the PDPB 2019 is getting deferred from one session to another is that the Ministry of Finance is demanding some changes which may be not acceptable. After all we know that NASSCOM and DSCI have already placed their demands for modification that wants financial information to be removed from the category of “Sensitive Personal Information” so that it can be freely transferred out of India. The Finance Ministry should be supportive of such move since this is necessary to allow data laundering through privatization of organizations like NPCI.

Today, yet another indication has surfaced why the Ministry of Finance cannot be trusted to take care of the interests of the country in securing the financial systems.

Some time back, Mrs Nirmala Sitharaman spoke in support of Bitcoins. We had raised our concerns directly with the Ministry of Finance to which as expected no response was provided either by the Minister or the secretaries.

It appears that the Ministry is stalling RBI and preventing them from re-issuing their circular which banned support to Bitcoin exchanges by Banks which was dramatically permitted by the “Bollywood Judgement” of the Supreme Court.

In the last few days, RBI seemed  to be re-introducing controls to prevent support of Banks in supporting Bitcoin trade and hence the Bitcoin industry has moved its attention to NPCI. This has triggered a fresh move from the Bitcoin lobby to put pressure on NPCI and support its cause.

Today a series of articles have been planted in the media stating

“NPCI Scraps Crypto ban Idea”, “NPCI leaves it to Banks to decide on blocking of Crypto trades”  “NPCI refuses to ban Crypto”etc

What this means is that NPCI has started supporting the Crypt Exchanges and they may allow private Bitcoin exchanges to use the NPCI switch to carry out Crypto trade by passing the Banks. Even if Banks are prevented from directly supporting Crypto trades, NPCI will become the larger clearing house to settle the payments between the buyers and sellers of crypto exchange.

Just as Bitcoin and Crypto currencies are going to make Indian Currency redundant, now NPCI will make RBI controlled Banks redundant and the eco system for Crypto trade would be complete without the Banks. 

I once again call upon Mrs Nirmala Sitharaman to wake up and break her silence. We donot know if she is on the side of Black money holders or against them. We request her as part of the Modi cabinet to confirm or deny whether the Ministry of Finance is trying to support the Bitcoin industry which is the support base of Cyber Criminals and Cyber terrorists besides being the digital black money of the world.

I have been highlighting that Crypto Ban is required to eliminate the strength of “Digital Black Money” and “Cyber Criminals”. I have also highlighted that anti Government activities of the opposition parties could be funded by Crypto currencies.

Mr Amit Shah may not be understanding the risk that a well oiled currency of the criminals can pose to national security. Mr Narendra Modi appears to be too busy with Covid issues and lost his will to eliminate black money. We urge them to realize the damage they are causing by their procrastination on the issue of Crypto ban.

Elimination of black money which includes banning of Cryptos is a step to recognize the honest citizens of India who donot want to support this global black money eco system. India leading a global movement to ban Cryptos as “Unregulated Currency” is essential to prevent illegal drug trade, illegal arms trade, as well as choke the dark web.

I wish some body makes Mr Modi realize that this cannot be done except by him and after his time, this country is likely to have a very bleak future. Already West Bengal and Kerala have joined J& K as problem states and some others will soon join. We then need another Sardar Patel to unify the country. One step required to slow down the erosion of nationalistic politics and empowerment of corruption led politics is to eliminate the source of funding of such transactions which requires Cryptos to thrive.

NPCI appears to be gearing itself to the role of a “Digital Black Money Exchange”.

In the meantime we need an explanation from NPCI for their recent supporting statements to boost Bitcoin.

As of now NPCI is open to RTI and I would like some of my friends to find out if all NPCI executives can declare their Crypto holdings  so that if and when Cryptos are banned and the holdings have to be accounted, we will know if these executives have been honest in their declarations.

If Mr Modi really musters courage to ban Cryptos, the industry will still try to extract a concession in the form of an extended time to get their crypto wealth converted into legit money. But this raises a moral issue that when demonetization of physical currency is given a certain window for conversion, why demonetization of digital currency be given more time.

I also request the Chief Justice of India to get a declaration of Crypto holdings of all the Judges since as and when the issue reaches the Supreme Court and argued as “Fundamental Right”, the bench of the Supreme Court which hears the case should be clean.

If BJP is really interested in eliminating corruption in India, this is the time to show their resolve.



I would like Privacy and Security professionals to go through the NPCI privacy policy available at

(Also achieved at


Responsibility for data protection in case of Amazon pay etc lies with NPCI. Says RBI



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About Vijayashankar Na

Naavi is a veteran Cyber Law specialist in India and is presently working from Bangalore as an Information Assurance Consultant. Pioneered concepts such as ITA 2008 compliance, Naavi is also the founder of Cyber Law College, a virtual Cyber Law Education institution. He now has been focusing on the projects such as Secure Digital India and Cyber Insurance
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