India needs to develop its own digital payments network for data protection: Parliamentary body

The joint parliamentary data protection committee has recommended India to develop its own electronic payment network modeled on Ripple (USA) and INSTEX (EU), which could be an alternative to the SWIFT payment system, the privacy of which is largely at risk.

The Society for Worldwide Interbank Financial Telecommunication, known as SWIFT, is based in Belgium.

“The committee notes that data protection is a real concern in the financial sector around the world, especially when privacy has been largely compromised by the SWIFT network. Indian citizens make huge cross-border payments over the same network.

The committee believes that an alternative to the SWIFT payment system could be developed in India that not only ensures privacy but also stimulates the domestic economy, ”the committee said in its report.

It found that following the “loan for file” scam in China in 2016, predatory loan applications from neighboring countries were deceiving Indians who were caught in a financial crisis due to the Covid-19 pandemic. These applications gain access to the contact database and gallery of the phones they are installed on and use sensitive information and harass the borrower.

At least 60 such loan apps available on the Google Play Store have not been registered or recognized by the Reserve Bank of India as a non-bank financial company.

Google Play has several such applications owned by Chinese operators or companies, including those named like other legitimate fintech companies. For example, “Udhaar Loan” is similar to “Udhaar”, a fintech with a focus on microcredits that is recognized by the Indian government.

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