RBI slams foreign banks on data rule

data, Audit, RBI, Reserve Bank for India, Foreign banks, Data storage norms

(This story originally appeared in on Jun 01, 2021)

The Reserve Bank of India (RBI) has pulled up several multinational banks operating in the country for not providing a board-approved system audit report certifying compliance with its data-localisation norms.

In a recent communication, the RBI said that a majority of banks are yet to submit system audit reports certifying compliance to data storage norms even after three years since the issuance of the circular.

It also said that many foreign banks have said that the audit norms did not apply to them and this was not acceptable. The central bank had asked banks to submit their compliance along with a plan of action on or before May 15, 2021.

data, Audit, RBI, Reserve Bank for India, Foreign banks, Data storage norms

Sources said that recently, the banking regulator had a discussion with some of the foreign banks where it made its displeasure known. According to sources, several foreign banks have been unable to issue an audit report stating that all personal and non-personal transaction data which has been sent overseas for processing has been permanently deleted. Last month, the central bank barred American Express Bank and Diners Club from on-boarding new customers citing violation of data storage norms.

The issue relating to data localisation is similar to the one that Google and WhatsApp had faced. What makes it challenging for banks is that RBI’s “on soil” data storage norms. These have a condition that payments data have to be stored “only” in India and no copy should exist outside the country. Many banks had responded to the RBI’s directive and said that much of their processing was centralised and it was not feasible to restructure global operations and create a separate hub in India. The RBI then clarified that while data can be stored only locally, it can be sent intraday for processing but should be deleted from offshore servers in 24 hours.

Banks are required to provide a system audit report certifying compliance with the RBI rules. The audit has to be conducted by auditors empanelled by the Indian Computer Emergency Response Team (CERT-In, in the ministry of electronics and information technology). The auditors study the IT infrastructure of the organisation and identify all the storage locations. The auditors also have to ascertain that data is being deleted from offshore servers.

News Related

OTHER NEWS

Play targets Rs 100-crore revenue by FY23

People line up for COVID-19 diagnostic tests at a makeshift testing center in front of Seoul Station, Sunday. Yonhap Social distancing level for rural areas to be raised to 3By ... Read more »

IFC, HDFC ink $250 million partnership to promote affordable green housing finance in India

Installation view of the exhibition “The Next of Public Design” at Culture Station Seoul 284 in central Seoul / Courtesy of Culture Station Seoul 284 Exhibitions explore how everyday life ... Read more »

Volvo bus numbers down 30% in the last year

Lai Shengyu and Yang Xiaogang, who are behind the Hunan artistic duo TaMen, have taken Chinese contemporary art to a new frontier by tapping blockchain technology to show how non-fungible ... Read more »

SBI is proxy to the Indian economy: Dinesh Khara

C Ventures, a private investment vehicle backed by a member of the family behind Chow Tai Fook Enterprises and New World Development, is eager to bet on more new-economy start-ups ... Read more »

SBI-led consortium raises Rs 792 crore by sale of Vijay Mallya's UB shares

Zoom Video Communications has agreed to acquire Five9 for US$14.7 billion in its largest ever acquisition, targeting a call centre provider to bolster its popular videoconference app against stiffening competition. ... Read more »

Fintech startup Junio aims to help children establish good saving habits

Sequoia Capital, Y Combinator, Better Capital, and other VCs have placed big bets in a handful of financial services companies aimed at kids. Read more »

ET Financial Inclusion Summit: DBT scheme's proved to be a boon for crores of Indians

Taiwanese money manager SinoPac Financials is making a killing with its Greater Bay Area fund after scoring 54 per cent gain over the past 12 months, while a Ping An ... Read more »

ET Financial Inclusion Summit: One growth account for all of India

Hong Kong stocks slumped on lingering worries about Big Tech clampdown while a US top official expressed doubts over future trade deals with China. Developer China Evergrande crashed 16 per ... Read more »

ET Financial Inclusion Summit: Universal banking access can become a reality only when more women are empowered

China’s waves of crackdown against its biggest internet companies are fuelling demand for technology stocks – a group that has so far remained untouched by the regulatory storm – in ... Read more »

ET Financial Inclusion Summit: Key goal of financial inclusion must be to help poor get credit, says Bandhan Bank chief

Pundits frame US-China competition in economic, military and diplomatic terms. But it’s actually about something far more important. US-China competition isn’t primarily economic. As China builds its consumer economy and ... Read more »

Inside IISc Bangalore's Incubation Lab

Sharon Au (left) and Thomas Ong used to be an item more than 20 years ago and remain good friends. SINGAPORE – Actress-host Sharon Au posted a series of hilarious ... Read more »

More Indians fall prey to online fraud, millennials suffer the most

Bengaluru | Chennai: Ensconced in the sprawling environs of the Indian Institute of Science Bangalore (IISc Bangalore), the Society for Innovation and Development (SID) has incubated over 40 startups since ... Read more »

Otipy, a social commerce platform, gets $10.2 million from SIG

China’s benchmark loan rate will be in the spotlight on Tuesday, with market participants divided over the need for more easing to support growth. The loan prime rate (LPR) could ... Read more »

Proxgy raises $250,000 in a pre-seed funding round

American Eagle, the denim and casual wear brand whose clothes have become a staple in the wardrobes of teenagers and millennials around the world, has been operating in Hong Kong ... Read more »

Seafood marketplace Captain Fresh raises $12 million from Accel, others

Tiziana Di Costanzo makes pizza dough from scratch, mixing together flour, yeast, a pinch of salt, a dash of olive oil and something a bit more unusual – ground acheta ... Read more »

After Tata acquisition, BigBasket wants to go big on express deliveries

Much of the focus on the Covid-19 crisis in South Asia has been on India. But its neighbour Nepal has also been devastated by the second wave of infections. Nepal, ... Read more »

I-T authorities unearth fictitious transactions of Rs 2,200 crore in pan-India search: CBDT

Netflix’s new reality series Sexy Beasts asks singles to find romance while wearing fantastical, highly detailed prosthetics. When the trailer debuted last month, it appeared to be the vibrantly coloured ... Read more »

From Zomato IPO to Flipkart funding, India's tech moment arrives

Is there any book that talks about fragrance evoking memories that does not mention French author Marcel Proust? Even those who haven’t read his Remembrance of Things Past know about ... Read more »

Razorpay acquires TERA Finlabs in push for startup, MSME loans

Jimin of K-pop juggernaut BTS is no stranger to the spotlight. But instead of his music, it was his wardrobe choice that recently created buzz among K-pop lovers and fashion ... Read more »

Upstox ropes in Thippesha Dyamappa from Amazon as CTO

The Chinese government had never said no to a merger deal in the country’s technology sector until last Saturday when the State Administration for Market Regulation (SAMR) blocked Tencent Holdings’ ... Read more »

ED stance strikes at the heart of cryptocurrency in India

Last week marked a watershed for technology start-ups in India, as a record bout of fundraising shifted attention to the world’s second-most populous market, just as investors were becoming spooked ... Read more »

MNCs fear tough tax stance in India ahead of global deal

The South China Morning Post, founded in Hong Kong in 1903, has become the first news organisation in Asia to champion a new blockchain standard where historical and archival items ... Read more »

What China expects from businesses: Total Surrender

Trade Minister Yoo Myung-hee bumps elbows with her Australian counterpart Dan Tehan, ahead of their meeting at the Four Seasons Hotel Seoul, Monday. The two ministers agreed on stronger cooperation ... Read more »

Zoom to buy cloud-based call centre operator Five9 in $15-billion deal

Doosan’s sign in front of Doosan Tower in Seoul / Korea Times file By Kim Hyun-bin Doosan Group has gone through some major hurdles to save its flagship affiliate, Doosan ... Read more »

From Tiger to Temasek, investors scarred by China edtech assault

Matteo Bassini for Quanta Magazine; spots by Olena Shmahalo/Quanta Magazine The grandest project in mathematics has received a rare gift, in the form of a mammoth 350-page paper posted in ... Read more »

Hyundai bags over 11,000 bookings for Alcazar

Hyundai Motor India on Monday said it has received over 11,000 bookings for its recently launched model Alcazar. Launched less than a month ago, the premium SUV has already garnered ... Read more »

Long waiting periods for a new car to be the norm as chip shortage persists

The long waiting periods for popular cars may remain a norm well into 2022, as the semiconductor shortage for the automotive industry causing these delays won’t be resolved any time ... Read more »

TVS Motor launches electric scooter in Kochi

TVS Motor Company, manufacturer of two and three-wheelers globally, on Saturday announced the launch of their TVS iQube Electric scooter in Kochi. Kerala Transport Minister Antony Raju and Joint Managing ... Read more »

Rajasthan govt's EV policy to hasten electrification, make e-bikes more affordable: Revolt Motors

Electric bike maker Revolt Motors has said Rajasthan government’s EV policy announced last week, which offers subsidies up to Rs 20,000 on the purchase of such vehicles, among others, will ... Read more »

Leveraging consumer insights to develop a complete range of premium electric bikes: Eicher

Eicher Motors is developing a complete range of electric bikes in order to cater to different set of customers across various markets, as per a top company official. Royal Enfield, ... Read more »

Banks consortium gets over Rs 792 crore in Mallya loan default case: Enforcement Directorate

The State Bank of India-led consortium that lent loans to fugitive businessman Vijay Mallya on Friday received Rs 792.11 crore in its accounts after some shares, earlier attached under the ... Read more »

Central Bank of India to seek shareholders' nod to set off accumulated loss of Rs 18,724 cr

State-owned Central Bank of India will seek shareholders’ approval in its ensuing annual general meeting (AGM) next month to set off accumulated loss of over Rs 18,724 crore from the ... Read more »

Failover mechanism protects us from MasterCard ban: HDFC Bank MD Sashidhar Jagdishan

India’s largest lender HDFC Bank’s open architecture framework and failover systems will protect it from the RBI ban imposed on global card network provider MasterCard, the lender’s managing director Sashidhar ... Read more »

RBI imposes monetary penalty on Tamil Nadu-based Melur Co-operative Urban Bank

The Reserve Bank of India (RBI) on July 20 imposed a monetary penalty of Rs 1 lakh on Tamil Nadu-based Melur Co-operative Bank for certain rule violations. The penalty is imposed on non-compliance with ... Read more »

Recovery Officer Debt Recovery Tribunal sells Rs 716-cr shares in United Spirits

Recovery Officer Debt Recovery Tribunal on Friday offloaded shares worth over Rs 716 crore in United Spirits Ltd, through an open market transaction. Bulk deal data on the BSE showed ... Read more »

Reduction in NPAs for PSBs due to write-offs at Rs 1,31,894 cr in FY21: RTI

Reduction in non-performing assets (NPAs) due to write-offs for public sector banks (PSBs) stood at Rs 1,31,894 crore during fiscal 2020-21, according to an RTI response. The RTI query was ... Read more »

SBI working towards launching Yono 2: Chairman

The country’s largest lender State Bank of India is working towards launching the next version of its digital lending platform – Yono (You Only Need One App), chairman Dinesh Khara ... Read more »

Second wave impact: HDFC Bank's NBFC arm sees bad loans double in three months

The second COVID wave exacerbated asset quality metrics for non-bank financial companies with HDB Financial Services the NBFC arm of HDFC Bank saw its gross bad loans almost triple in ... Read more »

Will bounce back strongly after pandemic behind us: HDFC Bank MD

Private lender HDFC Bank which posted a 16% rise in its net profit believes that it will bounce back sharply on all business metrics once the pandemic is behind and ... Read more »

Built business, collection strength in Q1: Dinanath Dubhashi, L&T Finance

The strength we have built up was a strong balance sheet with good provisioning, said Dinanath Dubhashi, MD & CEO, L&T Finance Holdings. “We had just raised the rights issue, ... Read more »