The Reserve Bank of India (RBI) on Thursday released a draft regulatory framework to allow the entry of a new kind of non-banking finance company (NBFC) that can act as an account aggregator.
Account aggregators help in collecting and providing the information of customers’ financial assets in a consolidated, organised and retrievable manner to the customer or any other person as per the instructions of the customer. The investors will be able to avail the service of an account aggregator purely at their option.
The central bank stated that it will regulate and supervise the activity of account aggregation while adding that entities being regulated by other financial sector regulators and aggregating only those accounts relating to the financial assets of that particular sector will not need to register with the RBI.
Only companies registered with the RBI as NBFC–AA will be able to undertake the business of an account aggregator and the net owned fund of such companies should not be less than R2 crore, the central bank stated.
RBI further indicated that an account aggregator will not be able to undertake any other business other than the business of account aggregator. “Initially, only financial assets whose records are stored electronically and are under the regulation of the financial sector regulators, namely, RBI, Sebi, Irda, and PFRDA shall be considered for aggregation,” it stated.
Account aggregation services will be provided under specific application by the customer for availing such services and would be backed by appropriate agreements/authorisations.
RBI further stated that no financial asset related customer information pulled out by the account aggregator from the financial service providers should reside with the account aggregator and these entities will not support transactions in financial assets.